Employee Benefits Down Slightly In 2009

Jun 29, 2009

Employers cutting back on health care and welfare, housing and relocation, and business travel benefits

NEW ORLEANS – Though U.S. employers continue to offer an extensive selection of employee benefits, 60 percent of HR professionals say the recession has caused their organizations to scale back or hold steady on benefit offerings.

The findings, released yesterday by the Society for Human Resource Management (SHRM) at its 61st Annual Conference and Exposition in New Orleans, are detailed in the SHRM 2009 Employee Benefits Survey Report.

“The recession plus rising health care costs are causing companies to evaluate all operating costs closely, even employee benefits, where a reduction in some benefits is required to survive the economic crisis,” said SHRM President and CEO Laurence G. O’Neil.

Compared to 2008, fewer organizations this year are providing housing and relocation, business travel, and other employee benefits. Health care and welfare benefits showed a relatively small decrease while family-friendly benefits showed fewer offerings for elder care referral services and adoption assistance.

Key findings from the survey include:

  • Organizations continue to offer family-friendly benefits for same-sex and opposite-sex domestic partners. Overall, 16 percent of HR professionals reported that their company offers some form of domestic partner benefits beyond health care. Specifically, 14 percent offer family-friendly benefits to same-sex partners and 14 percent extend the same to opposite-sex partners. For health care, 37 percent of organizations offer the benefit to opposite-sex domestic partners and 36 percent offer it to same-sex domestic partners.
  • Organizations recognize the critical importance of financial and compensation benefits. A financial literacy program benefit debuted on the 2009 survey with 12 percent of surveyed companies offering it. Also, more companies offered a defined contribution retirement plan benefit in 2009 (90 percent) than 2008 (84 percent). Notably, HR professionals reported fewer organizations offering the executive retention bonus benefit in 2009 (11 percent) than 2008 (17 percent).
  • Overall, health care and welfare benefits declined slightly in 2009 though more companies are offering mental health coverage benefits in 2009 than 2008.Seventy-five percent of HR professionals said their organizations offered the benefit last year compared to 80 percent this year. Mental health coverage was the only benefit in this category to be offered by more organizations in 2009 than 2008.
  • Among the 52 types of benefits offered under health care and welfare, eight declined in 2009: (1) contraceptive coverage; (2) HMO; (3) life insurance for dependents; (4) long-term care insurance; (5) retiree health care coverage; (6) supplemental accident insurance; (7) surcharges for spousal healthcare coverage; and (8) wholesale generic drug program for injectable drugs.

The other benefits category saw declines in several types of coverage with more expected before year end.HR professionals reported fewer companies offering: noncash, companywide performance awards; community volunteer program benefits; and discount ticket services. Also, a number of organizations report plans to reduce or eliminate holiday parties, company picnics, and company-purchased tickets to events during 2009.

HR professionals report that 20 percent of payroll for mandatory benefits, 19 percent for voluntary benefits, and 11 percent for paid leave benefits.

The survey, published annually by SHRM since 1996, gathers information on 10 employee benefits categories. The 2009 survey provides data on 274 different benefits and highlights responses from 522 randomly selected HR professional who are members of SHRM.

Colonial Life is the exclusive sponsor of the SHRM 2009 Employee Benefits Survey Report. The company is based in Columbia, South Carolina.

To read this and other SHRM surveys, please visit: http://www.shrm.org/Research/SurveyFindings/Pages/default.aspx.


About the Society for Human Resource Management

The Society for Human Resource Management (SHRM) is the world’s largest association devoted to human resource management. Representing more than 250,000 members in over 140 countries, the Society serves the needs of HR professionals and advances the interests of the HR profession. Founded in 1948, SHRM has more than 575 affiliated chapters within the United States and subsidiary offices in China and India. Visit SHRM Online at www.shrm.org.


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