Millennials & Compensation: Not Your Father's Benefits
Millennials Show Less Interest in Conventional Benefits than Older Workers
Compared to their older cohorts, millennial workers are less knowledgeable about their workplace benefits, and are more interested in paid time off than retirement plans, according to a report recently published by the Employee Benefit Research Institute (EBRI) and Greenwald & Associates.
The study, "Worker Opinions About Employee Benefits: Differences Among Millennials, Baby Boomers, and Generation X Have Implications for Plan Sponsors," was written by Paul Fronstin of EBRI and Ruth Helman of Greenwald & Associates. The report's findings are based on a survey of 1,500 U.S. workers aged 21-64, conducted June 10-19, 2015. The report analyzed workers' attitudes broken down by demographic cohort: millennials, born in 1977 or later; Generation X, born between 1966 and 1976; and baby boomers, born between 1946 and 1965.
While health insurance was named as the leading employee benefit by all of the cohorts, smaller shares of millennials than of baby boomers and Gen Xers cited it as the most important benefit: 67% of baby boomers surveyed said they consider health insurance to be the most important benefit, compared with 63% of Gen Xers and 60% of millennials.
In addition, the millennials surveyed were less likely than the baby boomers or the Gen Xers to say that they consider a traditional pension or retirement savings plan to be the most important benefit; but the millennials were more likely to report that they rate life insurance and paid time off as the most important benefit. Around 12% of millennial respondents, but just 6% of baby boomer respondents, said they consider paid time off to be the most important benefit.
The findings also indicated that smaller shares of millennials (31%) than of baby boomers (41%) or Gen Xers (39%) see the benefits a potential employer offers as extremely important in their decision to accept or reject a job.
Fronstin and Helman observed that it is therefore not surprising that millennials tend to be more open than baby boomers and Gen Xers to nontraditional ways of obtaining benefits. A larger share of the millennial respondents (24%) than of the baby boomers (15%) and the Gen Xers (18%) surveyed reported that they would prefer to take the money spent on employee benefits other than health insurance; and a larger percentage of millennial respondents (19%) than of baby boomer (15%) respondents said they are open to taking the money spent on health insurance and deciding for themselves whether to purchase those benefits, and how much to purchase. The millennials surveyed (20%) were also more likely than the baby boomers (17%) and Gen Xers (17%) polled to say they are extremely likely to use an employer-provided, independent, third-party benefits provider, when provided at no cost.
Despite their relative youth and inexperience, slightly larger shares of millennial respondents (26%) than of baby boomer (23%) and Gen X (24%) respondents said they are extremely confident in their ability to make informed decisions about benefits. Moreover, millennial respondents (33%) were more likely than baby boomer (26%) or Gen X (24%) respondents to report being extremely or very confident that they have enough money saved to cover expenses if a significant illness or accident caused them to be out of work. However, millennials were more likely than baby boomers to report that being out of work would cause them great hardship.
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Original Source: http://www.lundstrominsurance.com/benefit_plan_trends_-_volume_59_issue_1/