How do you balance employee expectations and budget constraints?
With firms across the region continuing to experience revenue and cost volatility as their top-line revenues are squeezed, proactive leaders are looking for ways to adapt and manage their risks and costs.
One fundamental element for the success of any business is to ensure it has a skilled and dedicated workforce. However, managing a company’s human capital is not without its challenges.
As the operating environment continues to evolve and impact the cost of doing business, firms are feeling the effects on their organisations. HR teams are struggling to find a balance between caring effectively for their employees while managing costs.
The UAE and Saudi Arabia already have compulsory healthcare and bear witness to benefits becoming more expensive over time, as over-utilisation, over prescription, and the rise of chronic diseases lead to higher premiums. Other countries within the Middle East are also expected to introduce mandatory company-sponsored healthcare and they can expect to experience similar challenges.
Some businesses simply can’t afford these rising costs.
As medical inflation across the region continues to outpace general inflation, this poses a significant concern for organisations. Medical insurance costs across the region have risen consistently over the last few years, as seen in the 2019 Mercer Marsh Benefits Global Medical Trends report. Traditional cost containment measures can stem these increases in the short term, but can negatively impact the retention and attraction of talent.
There are steps that businesses can take to mitigate the challenges that they encounter with their workforces.
Firstly, organisations need to ensure that their recruitment process is robust, and their employee benefits are attractive enough to secure the correct talent. Along with seeking the right talent, retention is also critical, as is the need to highlight the value of the benefits being delivered to employees. Most importantly though, organisations need to find a strategy that provides the perfect balance between providing their employees with competitive benefits and maintaining financial stability.
Companies can also engage their insurance brokers to help shape your Employee Health and Benefits (EH&B). It is important to remember that benefits aren’t a “one size-fits all” deal. A EH&B specialist broker should work with firms to design a package that is customised for the requirements of the organisation while maximizing the perceived value to employees.
Ultimately, it is possible to square the circle and balance the expectations of employees with the real-world challenges that businesses face in terms of budget.
Leigh Dauncey is sales leader – MENA at Mercer Marsh Benefits