Aon Study Finds Rising Cost of Employee Benefits a Top Concern for Asia Pacific Businesses
- Written by: Telegraph Magazine
SINGAPORE - Media OutReach - 23 November 2022 - Aon plc (NYSE: AON), a leading global professional services firm, has published its 2022 Asia Pacific Employee Benefit Trends Report, which evaluates the changing expectations of employees and the trends in employee benefit strategies in the region. The insights from the study aim to help employers quantify and qualify employee benefits and assess how their organisations can increase workforce resilience amid an increasingly volatile talent market.
The Aon study revealed that 55 percent of employers found that increase in benefit plan cost was their top challenge followed by 54 percent reporting unavailability of benefit packages that offer diversity, options, and flexibility to attract and retain talent.
Benefits Strategy
Exacerbated by the COVID-19 pandemic there has been a rapid and significant change in employee expectations in the region. Employees increasingly seek a work environment that supports their mental health and wellbeing, with increasing numbers asking for remote work arrangements, meaningful work and shorter hours. Employers recognise this with 35 percent of those surveyed reporting that 1 in 4 of their employees may work remotely in future.
However, while employee wellbeing was a key priority for 46 percent of the employers surveyed, 1 in 2 of the companies indicated that they lacked a clear benefits philosophy and that mid to longer term benefits strategy was a key future priority for them. Furthermore, 1 in 5 companies did not review their benefit offerings on a regular basis.
Tim Dwyer, chief executive officer of Health Solutions for Asia Pacific at Aon, said: "Employers in the region need to recognise the shift in employee work motivations resulting from COVID-19 and rethink their benefits strategy. To ensure they build a resilient workforce that can thrive during times of ongoing change and complexity, employers must leverage available anonymised and aggregated data insights around health and wellbeing, alongside employee feedback to gain insight into needs and expectations. These insights can inform decisions on how to manage the evolving structure of work or more specific solutions, such as ways to achieve a healthier and more inclusive team. Apart from the diversity and flexibility of benefits, there is a need to communicate the benefits employees receive more clearly."
Benefits Diversity and Communications
Talent attraction and retention is key for organisations with 28 percent reporting an increase in turnover of more than 5 percent in 2022. In the face of rising inflation and skill shortages, employers are offering holistic compensation packages, including benefits to attract and retain people with the right skills. However, 41 percent of employers reported that their benefits were not sufficient to fulfil employees' needs and 45 percent found that their benefits were perceived as 'below market'.
The study also found that 1 in 3 employers plan to implement flexible options or a choice programme in the near future, leveraging digital tools and voluntary benefits. Most prevalent locations where employers are implementing a flexible benefits programme are Philippines, India, China, Singapore, Malaysia, and Hong Kong.
Apart from a focus on enhancing benefits choices for the diverse workforce, the study also found that there are issues with the communication of benefit offerings to employees. Fifty seven percent of employers confirmed their employees were not fully aware of the benefits provided by the organisation, even though 3 in 4 employers communicated benefits through email and 41 percent used a digital benefits platform, with more companies moving toward providing a 'digital benefits home hub', as an access point for all things benefits.
Simon Thompson, practice leader for Health Solutions for Asia Pacific at Aon said, "Since the COVID-19 pandemic, there has been heightened expectations from employees for meaningful work, mental and physical wellbeing and work-life balance. These expectations are different for various talent groups; therefore, a standardised benefit offering may not appeal to all. Businesses therefore must have a clear employee benefit strategy catering to the various talent groups and ensure benefits are communicated often, leveraging both digital and more traditional approaches, whilst balancing sustainable benefit plan costs. A clear benefits and communication strategy will help businesses make better workforce decisions based on employee health and wellbeing data, talent attraction and retention outcomes, benefits spend and business performance - and ensure all elements are aligned to build a resilient workforce."
More information about Aon in Asia is available here.
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