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Employers Saying More About Benefits, Watson Wyatt Study Finds

Release Date: March 4, 2008

Contact: Janice Andrews

Significant Increase in Communication to Boost Benefit Enrollment

WASHINGTON, February 13, 2008 - More U.S. companies implemented internal communication programs in 2007, especially those that aim to increase employee participation in benefits programs.

Watson Wyatt's 2007/2008 Communication ROI Study™ found that 53 percent of employers used communication vehicles such as printed materials, special mailings and employee meetings to increase enrollment in benefits programs in 2007. This has more than doubled over the past four years, from 25 percent in 2003.

"As more companies take steps to rein in health care costs and update their benefit offerings, the need for better communication is becoming clear," said Kathryn Yates, global director of communication consulting for Watson Wyatt. "Companies expect employees to assume more responsibility for their financial and personal health, so it's important to provide them with the resources to make informed decisions."

In looking back at the communication trends since our initial study in 2003, Watson Wyatt found that employers are increasing their communication efforts in some areas, but lessening their focus in others.

For example, the number of employers offering personalized total reward statements has increased by 13 percentage points, but the share of companies offering educational material to ease the financial transition of workers nearing retirement has decreased by 11 percentage points. Additionally, the number of employers that regularly measure employee behavior change to verify that communication initiatives are working has increased by 24 percentage points. Today, more than one half (57 percent) of companies are using corporate communication scorecards to measure effectiveness in areas such as employee retention and manager performance. However, the portion that allows employee input on decisions that affect the company has decreased by 5 percentage points.

While companies don't always explain the reasons behind management decisions, they do tie employee performance to the prosperity of the organization as a whole. The number of companies that communicate the connection between pay and business strategy has risen from 70 percent in 2003 to 80 percent in 2007.

"Good communication connects employee performance to the bottom line," said Yates. "Companies that expect workers to perform at peak levels are explaining why they make certain management decisions. They gather employee input and feedback to build workers' understanding - an exercise that has been shown to increase their productivity and improve financial results."

The 2007/2008 Communication ROI Study includes the responses of 264 companies representing more than 6.2 million employees around the world.

More information is available here.

About Watson Wyatt
Watson Wyatt (NYSE, NASDAQ: WW) is the trusted business partner to the world's leading organizations on people and financial issues. The firm's global services include: managing the cost and effectiveness of employee benefit programs; developing attraction, retention and reward strategies; advising pension plan sponsors and other institutions on optimal investment strategies; providing strategic and financial advice to insurance and financial services companies; and delivering related technology, outsourcing and data services. Watson Wyatt has 7,000 associates in 32 countries and is located on the Web at www.watsonwyatt.com.
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