Organizations have an engagement problem. And a productivity problem. It was understandable — and expected — during the 2020 pandemic, but the ongoing drop in employee engagement and productivity has made it a top priority for businesses everywhere.
A recent Gallup survey revealed a continual decline in employee engagement in the U.S. — the first decline in nearly a decade. Thirty-six percent of employees were engaged in 2020, 34% in 2021, and 32% in 2022.
But it's not all doom and gloom. Gallup's 2022 Exceptional Workplace Awards highlighted companies that have achieved an average employee engagement rate of 70%, almost twice the average. How do they do it? One of the ways they've maintained enviable engagement rates is by putting employee well-being at the center of work.
You can, too. It starts with an employee-focused total rewards program that offers the perks and benefits employees need to prioritize their well-being.
What is a total rewards program?
Health insurance, compensation, paid time off (PTO) — they're all part of a total rewards program. But total rewards also include mental health benefits, professional development courses, savings accounts, and other non-monetary rewards. So, when you start putting together your total rewards program, be intentional about what you include and how you’re supporting employee well-being.
You'll also need to define a clear strategy for rolling out your total rewards program. Consider who you need to get buy-in from, when to bring in your employees' perspectives, how to streamline implementation, and how to measure the success of your program.
As you implement your total rewards program, keep an eye on employee engagement and productivity. Like the Gallup Exceptional Workplace Award (GEWA) winners that prioritize employee well-being, you'll likely see increases in both.
- GEWA companies that focus on employee well-being have a 72% engagement level.
- For every actively disengaged employee, GEWA companies have 18 engaged employees — 16 times the global average.
- Aon's recent well-being survey found that improving well-being factors can improve company performance by anywhere from 11 to 55%.
What is employee well-being?
Employee well-being is about an employee's mental, emotional, physical, and financial health, as well as an employer's role in each. While taking care of your employees is the right thing to do, many organizations are also reaping the benefits of building total rewards programs around well-being.
When employees feel that their employer cares about their overall well-being, they're:
- Almost 70% less likely to actively look for a new job
- 71% less likely to report experiencing burnout
- Three times more likely to be engaged at work
- Five times more likely to advocate for your organization as a place to work
On top of that, 71% of human resources (HR) practitioners, managers, and executives can clearly see a return of investment of their well-being efforts.
Four elements of employee well-being
Not sure what to include in your total rewards program? Start with employee well-being. Not just healthcare or employee assistance programs (EAP) — give employees comprehensive benefits that address overall well-being.
1. Physical well-being
These benefits help keep employees healthy, allowing employees to show up and do their best work. You can support employee health by providing impactful health benefits and supporting movement and activity throughout the workday.
Some physical well-being benefits to consider are:
- An on-site gym or monthly/quarterly fitness stipend for yoga classes, cycling, or a CrossFit gym
- Reimbursement for streaming platforms, like Peloton, or fitness subscriptions like ClassPass
- Programs to help employees quit smoking
- In-office or virtual team movement sessions
- Ergonomic workstations for on-site employees and a home-office stipend for remote employees to spend on an ergonomic setup
- An in-office kitchen fully stocked with healthy snacks
These initiatives aim to support employee health but also have some serious business benefits. Research from Harvard shows that companies prioritizing employee well-being have lower healthcare costs, less absenteeism, and higher retention rates. Standard healthcare benefits, like preventative care, on-site nutritionists, or access to a virtual health coach or personal trainer, also reduce healthcare costs.
BetterUp recommends supplementing with some less common perks:
- On-site health assessments like biometric screenings
- Providing health tech wearables — like Fitbits — to track their health
- In-office vaccination clinics to help employees limit illnesses like the flu
2. Mental well-being
In part because of the 2020 pandemic, employers started offering more comprehensive mental health offerings. And for good reason — studies show that workplace stress costs organizations $200 billion in healthcare expenses annually.
That's not all. A joint survey from FlexJobs and Mental Health America (MHA) highlighted other reasons to put mental well-being first:
- 75% of employees have experienced burnout at work
- 42% say they have high or very high stress levels (a precursor to burnout)
- 76% agree that workplace stress affects their mental health
The good news: a Gartner survey showed that businesses offering mental and emotional well-being support saw more than a 5% increase in employee engagement. You can, too, by supporting employees through well-being benefits like:
- Access to stress reduction tools, such as counselors through an EAP or mindfulness training
- Flexible schedules that promote work-life balance
- PTO with a minimum, so employees must use it
- A stipend for mental health apps like Calm or Headspace
These benefits all aid in improved employee engagement, but EAPs go beyond that. They support employees and indirectly support the business by increasing employee productivity and retention and reducing sick days. Plus, organizations see cost savings between $2,000 to $3,500 per employee through reduced absenteeism and presenteeism.
Lastly, work-life balance. The best strategy is based on what matters to your employees, but a few common practices generally help employees find a healthy balance. Giving employees schedule flexibility, paid time to volunteer, and meetings-free and mental health days are a good start. Also think about empowering employees to set strict boundaries, like not answering calls after hours.
3. Financial well-being
Between inflation, mass layoffs, debt, and economic uncertainty, employees have every reason to stress about money. And, as PwC's 2023 Employee Financial Wellness Survey shows, employees are exceedingly worried about their finances.
- 57% cite finances as the top source of stress in their lives
- 60% of full-time employees are concerned about finances
- Even among people earning $100,000 or more, 47% are stressed about finances
But it goes beyond just worrying about finances — nearly half of the employees surveyed find it difficult to meet their monthly household expenses on time, while 44% can't make their minimum credit card payment every month.
Employees are carrying a lot of financial stress and worry and are looking to their employers for help. If you're not already building financial well-being into your total rewards program, it's time to start.
PwC's survey revealed that 68% of employees report using the financial well-being services their employers offer. They want help. And, like with every other facet of overall wellness, your organization benefits from giving employees access to financial benefits.
The impact of financial stress on employee engagement and productivity
Data from PwC's survey shows that financial stress negatively affects many aspects of an employee's life, from sleep to mental health to self-esteem. Compounded, people show up at work distracted, disengaged, and looking for a way out.
Thirty-three percent of full-time employees say their financial worries have made them less productive at work, with 56% spending more than three hours per week thinking about or dealing with personal finance issues.
Not only are they less productive, but employees dealing with money stress are twice as likely to look for a new job with an employer that cares more about their financial well-being.
You can lessen this burden in a few ways:
- Help employees make the most of their paychecks. Twenty-eight percent of employees run out of money between paychecks, emphasizing the need for earned wage access (EWA). By allowing employees to access their pay early, see how much they're making in real time, and auto-pay bills straight from their paychecks, you can help lessen their stress over money.
- Offer employee retirement plans with matching. Employer-sponsored retirement plans, like a 401(k), help employees save for the future with tax-advantaged accounts. But when you offer a matching program, you're giving employees extra money to help them save now for retirement, potentially lowering stress about your employees' financial future.
- Provide education and resources. It can be hard to focus on long-term goals when you're struggling to make your money last between paychecks. Employees need support for both short- and long-term financial goals — money coaches or free financial education workshops can bridge that gap and help employees understand how to address their current money situation.
- Review compensation regularly. Financial well-being starts with a living wage. Since 2021, employees who report that their compensation isn't keeping up with living costs have increased by 18% (now at nearly 60%). It's also a factor in why employees leave. Conduct consistent wage reviews to make sure you have fair compensation that accounts for inflation.
- Offer debt management assistance. A less common but powerful financial well-being benefit is a student loan repayment plan where employers can offer employees up to $5,250 in tax-free benefits. Another option is a 401(k) loan that gives employees access to retirement funds if they have an immediate emergency or need to pay off a hefty medical or credit card debt.
4. Personal development
Personal development typically focuses on personal growth. In the workplace, it's about self-improvement and expanding skills, knowledge, and abilities to help employees advance their careers. It benefits both the employee and your company.
How? Organizations need employees to grow in their careers to continue providing value to the business. Nothing has made this more apparent than artificial intelligence (AI). Along with other new technologies, AI has highlighted the need to upskill employees to remain competitive.
Great Place to Work has a few suggestions on how to do that:
- Technical training that teaches employees skills for their next role (promotion)
- Training courses that teach employees about soft skills like communication or emotional intelligence
- Workshops, one-on-one coaching, mentorship, and job shadowing
- Funds for conferences, like the Adobe Summit, where employees can learn new skills or hone existing ones
- Tuition reimbursement for full-time employees
Want to empower and engage employees their way? Personal development is the answer. It helps employees build their confidence as they broaden or deepen their skill sets and empowers them to put their career trajectory in their own hands. This newfound confidence and control over their futures gets employees excited about accomplishing something new.
Let’s say an employee struggles with leadership. As they build those skills, they may begin volunteering to lead projects and experience the positive outcomes of their leadership. The result? They’re even more motivated to continue their development, a key driver of employee engagement. You’ve now got engaged, motivated, and empowered employees.
Employee well-being is here to stay
Countless research and surveys have come to the same conclusion: employee well-being matters. It drives increased employee engagement, satisfaction, and productivity. And businesses are catching on.
A global well-being survey from Aon shows that most organizations (80%) have begun integrating employee well-being benefits into their business strategies. They're finally thinking about the whole employee and how to support their physical, mental, and financial well-being while providing benefits that support their personal development.
It starts with implementing a total rewards program focused on employee well-being. So, if you want to prioritize overall wellness and realize the benefits of happier, healthier employees, it's time to get on board.
Looking for advice on how to best build out a total rewards program focused on employee well-being? This blog outlines how to get buy-in for, build, and deploy a successful program.
We’re also here to help you roll out the benefits in your total rewards program. OneSource Virtual (OSV) delivers in-tenant technology and expert services to automate the administrative, transactional tasks of Workday Benefits. With over 1,000 customers and a 95% customer retention rating, OSV is the leading exclusive provider of Workday Business-Processes-as-a-Service (BPaaS) solutions.
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