Economy Taking a Toll on Benefits, Still

Late Sunday afternoon, SHRM invited members of the press to a briefing on the results of its annual employee benefit survey.

The survey of 600 HR professionals didn’t reveal too many surprises. As might be expected, the economy continued to take its toll on benefit plans, with about 77 percent of those surveyed saying the economy has negatively affected benefits, up from 72 percent in 2010.

What areas were hit the hardest?

Mark Schmit, director of research at SHRM, cited healthcare (including the amounts companies are spending on healthcare, the coverages they are providing and the individuals they are providing them to), relocation benefits and pension plans.

In particular, Schmit said, the relocation data suggests a “structural problem” in the employment market. 

In the past five years, the survey found, housing and relocation benefits experienced significant declines, including temporary relocation benefits (25 percent in 2011 vs. 42 percent in 2007) and location visit assistance (18 percent in 2011, compared to 40 percent in 2007).

Despite 9 percent unemployment, Schmit said, HR professionals report they don’t have skilled workers for certain markets. Nonetheless, he added, employers are cutting back on their relocation support, even though 30 percent of families are now underwater in their homes.

Schmit predicted that the convergence of these factors and the nonmobility of the current workforce could have a significant economic impact in the next 12 months.

Workplace flexibility was one of the few benefit areas that experienced an increase in the 2011 report. More than half of those surveyed (53 percent) in 2011 said their organizations currently provide flextime as a benefit, up from 49 percent in 2010; and 20 percent now offer telecommuting on a full-time basis, up from 17 percent a year earlier.

Schmit surmised that companies were using workplace flexibility “to offset the benefit losses.”