What do American workers want?

August 22, 2012

| Money Rates Columnist

Take your pick: free health care or a 10 percent raise?

MSN Money recently ran a poll in conjunction with MoneyRates.com that asked readers to choose their preferred perk from a list of work-related benefits. Perhaps surprisingly, a pay raise didn't earn the most votes. Instead, respondents were most interested in health insurance benefits.

The value of health care

During a three-day period in early August, the poll asked visitors what they would like to have most from the following list. Nearly 10,000 votes later, the results looked like this:

  • Free health care: 44 percent
  • A 10 percent raise: 25 percent
  • An extra month of vacation: 20 percent
  • The ability to retire a year earlier: 11 percent

"Health care reform might have something to do with that," says Jeffrey Ingalls, president of employee benefits firm The Stratford Financial Group in Wayne, N.J. Ingalls says he was a little surprised by the poll results, but that the results mirror trends in how employers have managed benefits during the past 10 years.

While raises and 401(k) matches may have been cut, many employers have been concerned with maintaining other benefits such as health care. That emphasis from employers may be carrying over to how workers value their remaining benefits, Ingalls says.

Satisfaction with health benefits declines

While the MSN/MoneyRates.com results suggest Americans care strongly about health insurance, recent research by Gallup indicates that Americans have become more dissatisfied with their coverage in the last two decades.

"In 1989, we found 71 percent were completely or somewhat satisfied with the health insurance benefits offered by their employer," says Frank Newport, Gallup Editor-in-Chief.

By 2012, that number had dropped to 57 percent. Although a notable drop, Newport says the numbers have been around that level for several years.

"Satisfaction has been this low for the last decade," he says. "It actually picked up in 2009 when Obama took office."

Still, according to Gallup's polling, health care isn't the most prominent worry for workers. In a yet-to-be published poll, Gallup found that workers are less satisfied with the stresses they face on the job and their compensation levels than with their health care benefits.

Future of health benefits worries some workers

Even if it's not the least satisfying part of their job, an August 2012 poll conducted by Gallup found that 40 percent of workers were concerned their health benefits may be reduced in the near future.

They may have good reason to worry, as the average annual cost of employer-sponsored health insurance plans has topped $20,000 for the first time. The 2012 Milliman Medical Index found the total cost of coverage for a family of four in a preferred provider organization was $20,728.

The vast majority of workers are responsible for sharing at least a portion of that cost with their employers. Only 14 percent of full-time workers have their health care coverage paid for in full by their employer, according to a 2012 report from the Society for Human Resources Management.

To keep expenses in line, Ingalls says some employers are offering employees a flat amount for their health insurance coverage and allowing them to select from several company-sponsored plans.

"The biggest trend being talking about today is the defined contribution plan," he says.

Fortunately, Ingalls says workers are in good shape to make wise decisions for their families under these plans.

"People are smarter," he says. "They know the right questions to ask."

Raises may be on the way

While free health care was the top wish for workers in the MSN/MoneyRates.com poll, a pay raise was still preferred by one in four respondents.

Recent research suggests that while a 10 percent raise may be a little much for workers to expect, a smaller pay increase may be in their future. Three separate surveys from Mercer, WorldatWork and the Hay Group have each predicted that workers will receive average increases of 2.9 or 3 percent in base pay during 2013.

While that may not replace the free health care that some workers yearn for most, it's better than nothing.

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