How brokers can help employers in the face of high employment rates
Check out this column in BenefitsPro:
The U.S. is in a period of historically low unemployment, which provides a natural lift to brokerages. As employers grow the number of employees they have, broker commission amounts also rise.
And there are steps brokers can take to drive additional growth beyond what’s naturally created by a robust employment rate. In particular, helping employer clients expand benefits in the context of recruiting and retaining talent in the middle of a red-hot economic environment can present a valuable strategy for brokers looking to create agency growth.
Focus on recruitment and retention
When prospecting, brokers naturally tend to focus on solving problems and cost pressures within the health plan. While this isn’t going to change, brokers may also want to begin asking clients and prospects if they have challenges with recruitment and retention.
Why? With the unemployment rate so low, the answer is probably yes. Most organizations of every size have recruitment on the brain, and many are struggling to fill open positions.
Brokers have an opportunity to add value in this area by using benefits to help small- and mid-sized employers become more competitive recruiters. For small businesses especially, employers may not be thinking about benefits from a recruitment perspectivel. Many tend to focus exclusively on compensation.
With hiring leverage largely in the hands of employees, this could be a mistake, and there is a good chance these clients or prospects are missing out on talent based on their benefits package.
By drawing awareness to this issue, you can open up the conversation about how a more competitive benefits package can improve hiring rates.
What does a robust benefits package look like?
You may want to find a real-life example from a large, competitive employer in your market. Here in middle Tennessee, Nissan is such an employer, offering a wide span of coverage, from health and dental to disability and critical illness and beyond.
Using an example, you can determine how the prospect’s benefit plan compares and demonstrate why offering more lines of coverage aids in recruitment.
Many small and mid-sized employers may think that they can’t afford to offer so many lines of coverage. However, many supplemental and ancillary lines of coverage can be offered on a voluntary basis at no or little cost to the employer.
What actually keeps most small and mid-sized employers from offering benefits packages on par with companies like Nissan is the administrative burden. Most small organizations don’t have the HR resources to manage so many lines of coverage on paper.
However, more and more brokers and employers are using technology solutions to administer benefits and HR, which cuts the administrative burden and makes this process much easier to manage.
Employees can easily see what benefit options they have available and how much each will cost if elected. As a result, ease of use contributes to increasing participation rates.
Ultimately, this creates a triple win for employers, employees and brokers. Employers are able to better compete in a challenging recruitment environment by offering a better benefits package. Employees feel well taken care of and are able to pick and choose the benefits that matter most to them. On top of this, brokers see rising ancillary revenues in an already strong employment environment, further contributing to agency growth.