A survey conducted by Grant Thornton reveals that employee benefits rank at the top of employer cost control concerns. According to the survey, “A vast majority (84%) cited employee benefits (e.g., health care, pensions) as their greatest pricing pressure — up from 68% six months earlier.”
In response, about one-third of employers plan to cut employee health benefits. The good news is that more employers are planning to increase health benefits compared to March 2010.
|Change in Employee Health Benefits||Oct 2010||Mar 2010|
Most economists believe that employers view health insurance as a cost just like salary. Thus, the downside of increasing health insurance benefits is that salary increases would not be as high as they would with a smaller increase in employee benefits.