Americans are anxious about the economy and for good reason. Most workers’ wages have not kept pace with inflation over the past 18 months. American families are being increasingly squeezed with over 70% of Americans reporting they have cut back on spending in the last six months.
Employers are also facing headwinds with rising supply costs and uncertain economic forecasts, tempering their ability to both increase wages and remain profitable. Compounding this problem for employers and workers are projections of much higher premiums for employer-sponsored health coverage.
While on paper employers pay a substantial portion of the costs of health coverage provided to employees, this expense is a form of employee compensation. Economists agree that employees bear the burden through reduced wages, ultimately paying the full cost of the coverage.
Employers compete for employees by offering a compensation package, which includes wages, benefits like health insurance and retirement, and ancillary features such as flexibility to work from home. A recent survey found that over 90% of employers viewed health benefits as a very important offering for employees.