The Hire thru Retire Podcast
Kerry Sette Returns for a Deep Dive into Employee Insights Heading into Open Enrollment
Today’s episode features host, Nate Black, VP, Health Solutions Product Development. As we’re entering the fall, now is an exciting time to talk about open enrollment and to do this, in this episode we are focused on some new trends and areas where many employers are focused. Joining Nate is a guest who will sound very familiar to you all and that is Voya’s own Kerry Sette, head of Consumer Insights and Research at Voya. Tune in to hear all that Kerry has to share with new data.
CN3065073_0825
Today’s episode features host, Nate Black, VP, Health Solutions Product Development. As we’re entering the fall, now is an exciting time to talk about open enrollment and to do this, in this episode we are focused on some new trends and areas where many employers are focused. Joining Nate is a guest who will sound very familiar to you all and that is Voya’s own Kerry Sette, head of Consumer Insights and Research at Voya. Tune in to hear all that Kerry has to share with new data.
CN3065073_0825
You're listening to the Hire Through Retire podcast brought to you by Voya Financial. We're talking to the best and brightest in the industry to bring you the latest in benefits, savings and investment trends in the workplace, tackling all things from 401Ks to HSAs and everything in between. Come along with us on our journey to help all individuals become well-planned, well-invested and well-protected.
Speaker 2:Welcome back to the Hire Through Retire podcast.
Speaker 2:I'm Nate Black, head of Health Product Development here at Voya.
Speaker 2:I'm excited to be your host for today's episode.
Speaker 2:For those of you who are avid listeners of our podcast, you know that the fall is a very exciting time for us in the workplace benefits industry, and that is because it's time to talk about open enrollment, while an area near and dear to me. We also thought that this episode would be a great time to focus on some new trends and areas where many employers are focused as we think about the upcoming annual enrollment season ahead of us. To support this, we thought we'd bring back a guest who will sound very familiar to you all, and that is our very own Kerry Sended, head of Consumer Insights and Research at Voya. While a wealth of data knowledge, kerry is here today to talk more about some of our latest consumer research, taking a closer look at where employees' heads are at when thinking about their open enrollment this year and, more broadly, what employers need to know when it comes to how their employees feel about their workplace benefits and saving needs. Without further introduction, kerry, I'm excited to welcome you back to the pod and thanks so much for joining us today.
Speaker 3:Hi Nate, it is so great to be back on the pod. As you know, right the Voya Consumer Insights and Research team we're tracking employee sentiment in real time and there's so much to share with employers, especially as we think about what employees need, what they want, heading into this open enrollment season. So I'm so happy to be back here to share some of those really important insights with all of you today.
Speaker 2:Yeah, it's going to be exciting to hear what you've got to share here Before we take a deep dive into the data. As you shared on the podcast before, your team, among many other things, is often focused on conducting research on how Americans are feeling, just about their personal finances and other benefits and savings topics. So I know you're here to talk today specifically about open enrollment, but in your latest research, can you just share at a high level some of the themes that have bubbled up?
Speaker 3:Sure, and I totally agree with you, nate. I think it's really important to think about some of the what we would call kind of macro trends that we're seeing. This is the important backdrop right going into open enrollment season. Some are calling it I've heard it a perma crisis, others are calling it a poly crisis, but whatever you want to call it, it's definitely a difficult economic cycle, right, one filled with volatility, and it's likely here to stay. So, while there is some good news in that sentiment has started trending positive since June of this year, it's important to keep in mind that it's still very much more negative than positive, right. We have rising interest rates, bank collapses, the debt ceiling crisis all of this happening in the first half of 2023. And, ultimately, efforts to combat inflation have impacted consumer sentiment negatively. Right, think fed rate hikes, and consumers are really being forced to prioritize those sort of short term spending needs over longer term saving schools like retirement.
Speaker 3:The other kind of big theme that we're seeing in our research is Institutional trust is really on the decline now. Some frame this, as you know Well. Trust is now more important and more fragile than ever before, but there is very little trust in our country's institutions, and that includes banks, financial institutions and even, as of late you know, the Supreme Court. And just as an example, right we saw a Silicon Valley Bank lost trust and essentially imploded in literally less than 72 hours. In addition to all of our proprietary data, we see things like the Edelman trust barometer, and this is showing that economic optimism has essentially Collapsed globally, with half of the countries that they survey showing year over year Double digit declines and the belief that their families will be better off in five years. And you know, personal economic fears like job loss, inflation, are essentially on par with like societal fears like climate change, nuclear war and even food shortages. We also look to you know, some of morning consult data around financial well-being and across all income brackets, americans are worse off than last year and even the higher earners were struggling with inflation. And I'm sure you've heard, but there were talks of like white collar recession and especially, as you know, we've seen these math layoffs in the in both the tech and financial services sectors. So even in our own research of March of 23, we saw only 63% of participants say that they were prepared for retirement. I want to highlight this because this is much lower than employers or plan sponsors Estimated their retirement preparedness. So definitely a gap in terms of employers not really understanding how employees feel at this point in time. And of course, you know we compare all that data that we have with Employee benefits.
Speaker 3:Research Institute eBreeze retirement confidence survey. They've been tracking retirement confidence for literally 30 years and they saw that, you know, this year was the biggest year-over-year drop in retirement confidence and landing at 64%. So literally within a percent of ours. And that 12 percentage point drop in retirement confidence. It's important because they have not seen that Since 2008 they have not seen a drop like that. And the primary driver is really In high inflation. So all you know, all that data really hang together.
Speaker 3:You know, most recently in our June data, we saw that 73% of Americans are worried about their ability to put money aside for emergencies and that's because of Inflation. And then you see some of the latest data on credit card expenditures. We see that Credit card debt is higher than ever before and consumers are paying a steep price 47% of credit card holders are now carrying debt from month to month and that's up from 39% in December of 22, you know. And the top unexpected expenses, of course it's healthcare costs. It's also expensive car repairs.
Speaker 3:And then we see in our own data six and ten American saying, Because of inflation, they can't pay their debt down as quickly. And then, even as of late we were in field in June of this year nine in 10 Americans still say their money does not go as far as it used to and 75% are worried about being able to save for their retirement. So I know I dropped a lot of data bombs right. I got a lot of data to digest there. But while there are some signs of increased optimism, which is great, there are still so many financial challenges that American workers are facing heading into this open enrollment season, and we would be remiss if we didn't mention all of that.
Speaker 2:Yeah, those statistics are fascinating and I'm excited that was my question that I asked without data. I'm excited for these next ones where we even dig in further to see where we go. And so what you're highlighting is almost like a split screen where, at least on inflation, as you're bringing up, it's less of a topic and the media at least what I see today it's sort of, hey, it's getting under control, it's coming down, but when we look at the impact to employees and our pocketbooks and how they're thinking about being able to save for retirement or an emergency expense, it's still having this really significant impact. And so, with that backdrop, curious, as we shift, maybe, towards open enrollment, how these insights apply and what your team has found when it comes to thinking about inflation and concerns around health care costs, is that health care decision, that health insurance decision, is one of the most important during open enrollment.
Speaker 3:Right, and health care is certainly a big piece of the cost of benefit. It's hard for working Americans to see everything around them costing more, so everything around them is costing more. We know that pay hasn't really kept up with inflation, so real wages are still lower even with inflation leveling off, and so they're seeing these higher prices still at the grocery store, still at the pump. They're troubling to cover monthly expenses. So for employees to just magically think that all of a sudden their benefit costs will stay the same or somehow be lower at their time of enrollment, it's really just not realistic for them. So in March of 23, we saw in a survey that we did, inflation, the economy and health care costs were literally the top three concerns that participants say will have a severe or major impact on their ability to save for retirement.
Speaker 3:I would say the most surprising stat from our June research revealed that even as, again, inflation is leveling out, a majority of Americans eight in 10 working Americans agree that because of inflation they are worried that their workplace benefits will indeed cost them more of this open enrollment. And it's important because this is an increase from what we've seen, from 66% in June of 22, when inflation was really at its peak. So the way we frame this Nate is inflation is coming home to roost right. Inflation is having a long-term impact on American sense of financial security, and I would also just call out that this number was even higher for caregivers. So that's one in five Americans are caregivers and we all know that well-documented cost of caregiving. And here we saw almost nine in 10 employees who are caregivers say that they are worried that their benefits are going to cost them more this year. So that is top of mind for employees going into this open enrollment season.
Speaker 2:Yeah, I mean. The picture that you're painting carries a pretty stark one, where all of these financial concerns are coming home to roost. As you said, the concerns are bubbling up. Even though inflation and other things are maybe more stable, we're seeing these issues still continue to impact people and we've spent a lot of time, maybe, on the financial side. Can I save, can I afford my benefits?
Speaker 1:But one of the other things.
Speaker 2:I know you and your team have spent time looking at is how these financial trends impact mental health, and we know certainly these financial trends and pocketbook issues do have a direct impact on people's mental health, and so we'd love to just hear how, in your research, if you found specific data on sort of those impacts of financial stability and mental health, then how this maybe translates into the benefits many employees might be seeking from their employer.
Speaker 3:Yeah, that's a great question and you know, as a way, we definitely have conducted a ton of research around mental health and well-being and the connection with financial stress and we've done qualitative focus groups, online community explorations and we've heard employees point blank asking for things like mental health days and we see this need especially pronounced right for younger employees who really bore the brunt of the pandemic and isolation. But seven in 10 Americans agree inflation has made them more stressed about their personal financial situations and the linkage with their financial worries financial stability is alarming. We found 57% of Americans agree that their financial stability has a direct impact on their mental health. So everything we've been talking about is taking its toll on the health of employees. You know, as finances really remain top of mind for many, as they, you know, enter into an open enrollment season, benefits, including a focus on mental health, are really coming into demand, more, I would say, than ever before. Even with the recent eBree research, we saw six in 10 Americans saying mental health and wellness programs are now more important than ever. It was a 10 percentage point increase from the prior year. We also see in PWC's financial wellness study. You know, mental health issues driven by financial stress absolutely impact the employer's bottom line. Employees who say that money worries have a negative impact on their mental health are six times more likely to say that financial stress has impacted their productivity at work, seven times more likely to say that financial stress has impacted their attendance at work. They're two times more likely to be looking for a new job and then, from an engagement standpoint, they're less likely to feel valued at work. So all of this is critical to keep in mind, as our own research from June this year found that 63% of employees agree that their mental health has a direct impact on their ability to perform their job effectively.
Speaker 3:So again, here all that data really hangs together, and even more like the demand from today's workforce is increasingly apparent. We see more than half of employed Americans 56% Say that the employer absolutely has a responsibility in ensuring that they are mentally healthy and emotionally well. So the employer very much has a role here. And even more telling, nearly half so 48% said they would select a workplace benefit that provides more mental health support and resources if offered by their employer, even if it costs them more. So that's in the current environment where they're essentially saying I can barely afford to save for my retirement. And now they're saying I will even pay more for mental health support and resources.
Speaker 3:So we believe right, this is definitely a cry for help, and I'll just call out we've also done research with sponsors, and this was from last year, but we found that the vast majority of plan sponsors so this was more than eight in 10, believe that their organizations can do more to address mental health issues, stress and burnout. So even employers are saying more can be done here, more should be done here. And it's important to remember that there is an upside for the employer. In our research, half of employed Americans said that they were more likely to stay with the current employer if they offered mental health benefits and resources, and that was 50%. So it's very clear that employers have an opportunity Some would actually argue a responsibility right To provide the mental health and wellbeing resources and support that their workforce really has come to expect. And again, the payoff is there. It really makes the employer more sticky, which is really important in this war for top talent.
Speaker 2:Yes, right, I like the word you use right at the end. There, carrie, there's really an opportunity and maybe responsibility as well, but an opportunity, I think, for employers to be thinking about here, and so often I mean, we could spend the next probably hour thinking about what are those statistics about how people are struggling with mental health issues or financial issues, but I think the opportunity here is that employees are looking to their employers for help, and it can have a real impact on both the employee and employer. And so we've got a lot of employers listening to the podcast here, brokers and others who support employers that they get ready for open enrollment. So, as we're talking to that audience, what else maybe have you and your team heard that might present opportunities for employers to keep in mind? Is they're really supporting their participants in the months ahead as we drive towards open enrollment?
Speaker 3:In the past, generally speaking, we've done a lot of research just around open enrollment decision making and we've seen that some employees really just tend to look back at their last year's enrollment for guidance and kind of assess any big changes in their family's health or finances, and so there's been some what you might call inertia and making some benefits changes. However, we do think the current environment has employees taking a more thoughtful approach this year, especially as they struggle with monthly expenses and debt, as I mentioned. However, the good news is that Voyas Research revealed a significant amount. So seven in 10 Americans agree that they feel confident in their ability to choose the right health benefits for their family's needs. So they feel that they have the right information they need to choose those health benefits, which is really great. And I will also just say, despite everything that we've talked about, we've seen American workers are amazingly resilient and many are continuing to stay the course on their investments, especially their long-term investments, and that's 85% are staying the course in this volatile environment. They're continuing to stay for their retirement. So that's generally speaking, eight in 10 say that it's important to continue saving for their retirement and really keeping focus on those longer-term saving goals as they learn to essentially live with inflation and increase market volatility. So I wasn't surprised to see that even more American workers eight in 10, are looking for ways they want to maximize their benefit dollars across retirement savings, across health insurance, HSAs and voluntary benefits at work as they head into open enrollment this year. And it makes sense right, they're looking for the most bang for their buck. How do I maximize all these decisions and get the most for me and my family?
Speaker 3:So it's important that employers provide the resources for employees to really better understand and utilize those amazing benefits that they offer, inclusive of their workplace benefits and retirement savings.
Speaker 3:And this shows that employers are invested in their employees' futures to really help create greater outcomes for everyone.
Speaker 3:And some of our recent research also suggests that at least 2 thirds to 65% of employees they're open to receiving information about their benefits all year long. So this is outside of open enrollment to help them understand their benefits. And, by the way, this is significantly up from what we saw in March. Employers really need to be thoughtful about that and strategic about that communication stream, and not just that open enrollment, but post-enrollment too. Employees want to get the most use out of the benefits that they enroll in. So we think this is really a huge opportunity for employers and other intermediaries to help support employees throughout that entire year, especially during challenging economic times like the one we're living in. And we also know from our March survey that 72% of participants are interested in receiving help to get back on track towards those retirement savings goals. So, again, some incredible opportunities to really support employees, to help them manage both today and continue to save for tomorrow and all their longer term saving goals.
Speaker 2:Yeah, there's, I mean, just so much great information there, carrying what you shared, and unfortunately we could talk for another hour on this topic, I think, but we'll have to leave it there.
Speaker 2:But I think the context that you shared around hey, there's an opportunity to help people during open enrollment, which I think about from the benefits background is that Super Bowl every year you get ready for. Employees are struggling, many of them as they come into this open enrollment period but they're really looking to their employers and others for help, and so such an opportunity for us to be there collectively as an industry to support them and making sure that they're maximizing and optimizing those decisions that they're making and also continuing to educate them, as you said, a year round. I'm surprised to hear that 65% are open to that communication year round, which is great to see too. So, I think, a lot of opportunity for us in the industry. We're excited to work with many of the people who are listening here to do just that over the next couple of months. So, Carrie, thank you for an incredible conversation. I just love the data you bring and the way you bring it to life, and hopefully that was helpful for our listeners as well.
Speaker 3:You know. Thanks again, nate, for having me. It's always wonderful to be able to really kind of be the voice of the employee and help these numbers come to life and especially during this really challenging time for employees and voice consumer insights and research team. We're going to continue our real time tracking of employee sentiment and all things workplace benefits. So there's a lot more to come. Thank you again for having me and I do hope you'll have me back on the pod soon.
Speaker 2:Absolutely, and I should also say thank you to our listeners for your continued support and appreciate everyone for joining us today. Bye everyone.
Speaker 1:This information is provided by VOIA for your education only. Neither VOIA nor its representatives offer tax or legal advice. Any opinions expressed within do not necessarily reflect those of the VOIA family of companies or its representatives and are not intended to provide specific advice or recommendations for any individual. Please consult your tax or legal advisor before making a tax related investment or insurance decision.