SI Review: September 2010

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Last Words, SI Review September 2010

Employers Unlikely to Drop Healthcare Benefits
Most U.S. employers, at least for now, are unlikely to stop offering healthcare benefits in the wake of the landmark federal healthcare reform law.

An online survey of nearly 3,700 executives conducted by Crain Communications Inc. publications Workforce Management and Business Insurance found that 52.5% strongly disagreed with the statement it would be better for their organizations to stop offering healthcare benefits and pay a fine under the new law. An additional 15.3% somewhat disagreed with the nation of dropping coverage and paying the fine. Eighteen percent somewhat agreed with the idea of dropping coverage; only 14.1% strongly believe their organizations would be better off in dropping benefits.

Under healthcare reform, beginning in 2014, employers with 50 or more full-time workers must offer healthcare coverage or pay a fine of $2,000 per worker per year. Among the largest employers -- those with 25,000 or more workers --â۠64.9% strongly disagreed with the statement that their organizations would be better off dropping healthcare benefits. An additional 12.4% somewhat disagreed, while 14.2% somewhat agreed and 8.4% strongly agreed.

The survey also found executives overall have a mixed level of understanding of the reform legislation. When asked whether they understand the impact the law will have on their benefit programs, only 17.7% strongly agreed that they understand the impact; 43.9% somewhat agreed. More than 38% either somewhat or strongly disagreed that they understand the impact.

Sixty-one percent of survey respondents identified themselves as responsible for the purchase and/or administration of healthcare benefits. Those with decision- making responsibility -- including C-suite executives -- reported similar levels of understanding as the overall survey group. About 18% strongly agreed they understood the impact of the law, while 44.9% somewhat agreed and 37.3% somewhat or strongly disagreed.

New Wave of Independent, Self-Employed Free Agents Emerging
Economic uncertainty has fueled a growing trend toward self-employment and entrepreneurism: One in five workers who participated in a Kelly Services survey say they are now working outside the traditional employment relationship.

The rise of the self-employed, often known as independent contractors or “free agents�, is most pronounced in North America, with 26% identifying themselves in this category, compared to 19% in the Asia Pacific region and 17% in Europe.

The survey found that nearly one-quarter of respondents would like to start their own businesses, with younger workers most likely to pursue a business venture.

The Baby Boomer generation (those between the ages of 48 and 65) make up the largest share of this expanding group, but the desire to move to a more flexible and independent career status is shared by both Gen X (those between the ages of 30 and 47) and Gen Y (those between the ages of 18 and 29). Men are more likely than women to be self-employed and want to start their own businesses.

The survey found that:

  • Twenty percent of those surveyed are working outside the traditional employment relationship as freelancers, consultants, independent contractors or free agents.
  • Of those not working independently, 12% would like to do so.
  • For all age groups, the main factors preventing a move to greater independence is uncertainty about income, while younger workers also are concerned about the risk of failure and older workers worry about the cost of healthcare.
  • Thirty percent of Gen Y say they’re likely to start their own business, compared to 22% of Gen X and 14% of Baby Boomers.
  • Forty-eight percent of respondents say they feel their current skills would be sufficient to enable them to start a business, with Baby Boomers and Gen X (both 54%) more confident
  • than Gen Y (40%).
  • There is a feeling among all groups that the market demand for their skills will remain strong over the coming year.

 

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