How Employee Wellness Programs Are Evolving in the Pandemic Era

As the line between work/life becomes increasingly blurred, companies are embracing a big-picture view of employee health.

Workplace wellness programs have been around since the 1970s, when a growing fitness trend converged with employers beginning to recognize the high costs of poor employee health. Since that time, employer-sponsored programs that emphasize health and wellness have become commonplace.

A study conducted in 2010 by the Society for Human Resource Management found that more than 9 in 10 companies around the world offered employees at least one kind of wellness benefit. Many companies offer comprehensive wellness programs that cover physical fitness, nutrition, and stress-related concerns. About 80% of large companies and more than half of smaller companies offer this type of program.

Employers have learned it is not enough to simply disseminate nutrition information in the cafeteria or offer health club memberships. An effective employee wellness program requires a corporate culture that values health at all levels, right up to the C-suite. The programs must align with the company’s identity and business priorities and must involve quality initiatives that are enjoyable and relevant to individual needs.

Benefits for Employees and Employers

Healthy employees save companies money. A 2019 report from Deloitte found that businesses with high health and wellness scores had a 75% greater stock appreciation over six years than the overall S&P.

J&J estimates their wellness programs saved the company more than $250 million in 10 years.

Johnson & Johnson (J&J) evaluated the effectiveness of their employee wellness programs over a 15-year span and found the percentage of employees who smoked cigarettes dropped by more than 75% and those with high blood pressure declined by more than 50% as a result of the programs. J&J estimates their wellness programs saved the company more than $250 million in healthcare costs in a 10-year period.

Another study, published in The American Journal of Cardiology, compared a group of employees who participated in a workplace heart-health program to a control group. At the end of the program, more than half the participants had lowered their risk for heart problems, whereas the control group showed no improvements. The company found their medical claim costs had declined by $1,420 per participant compared with the previous year, and calculated that for each dollar spent on the wellness program, they saved $6 in healthcare costs.

As healthcare costs continued to rise, results such as these led companies to invest more in employee wellness programs, which have grown into an $8 billion dollar industry in the US. Research by United Healthcare shows that in 2017 companies spent an average of $742 per employee per year on wellness. More than half the companies with dedicated wellness budgets that year expected to increase those budgets over the next two years.

Not all employee wellness programs yield the same results. A 2019 study published in JAMA found that while companies that offer workplace wellness programs have more employees reporting higher rates of fitness and weight management, other health and productivity measures were not significantly different with or without a wellness program. Another randomized controlled study, published in JAMA in 2020, found that after two years of participation in a wellness program, participants believed their health had improved significantly and were more likely to have a primary care physician; however, the researchers observed no significant effects on health outcomes or medical diagnoses.

Job Satisfaction and Employee Retention

While much of the research has been focused on healthcare savings for employers, companies say the benefits of wellness programs go far beyond the bottom line. Often overlooked is the impact these programs have on strengthening a company’s culture and building employee trust and commitment. According to Julie Stich, associate vice president for content at International Foundation of Employee Benefit Plans in Brookfield, Wisconsin, three quarters of employers promote wellness to improve job satisfaction and well-being, with just 25% of employers motivated solely by reduced healthcare costs. Joe Beccalori, CEO of New York-based digital marketing agency Interact Marketing, told Forbes that wellness programs can help even small companies recruit and retain employees and improve employee job satisfaction. Prior to his agency starting one such program, annual staff turnover was about 15%. In the three years after starting their wellness program, not one employee left, and productivity increased by more than 15%.

"Thinking about well-being in broader terms-physical, financial, mental and social-really does make sense."--Jeff Levin-Scherz, Harvard Medical School. 

Employees are unequivocal on the value of workplace wellness programs. A recent survey from Prudential Group Insurance found that 77% of employees considered a benefits program a crucial part of their compensation, a 10% increase from the year before. The trend is clear: Employees are increasingly demanding some sort of wellness benefits program.

Pandemic Changes 

The COVID-19 pandemic has significantly changed the workplace, and employee wellness programs are caught up in the sea change. Many employees are now working remotely and may have reevaluated how they prioritize health. More than 70% of employees have described the pandemic as the most stressful time in their careers due to job loss, pay cuts, personal illness or the loss of loved ones, and additional home responsibilities.

Companies are scrambling to redefine corporate wellness to meet the needs of a post-pandemic workforce, taking a more rounded approach to well-being. A survey conducted at the end of 2020 by the job-search site Indeed found that nearly half of respondents felt the lines between work and life have become permanently blurred. Companies who have added non-traditional services to their benefits packages report a surge in job applicants. “There has been a migration from traditional wellness programs to programs that actually have more facets and hopefully address the needs of different employees at different places in their lives,” says Jeff Levin-Scherz, Harvard Medical School professor and senior consultant of the health management practice Willis Towers Watson in the greater Boston area. “Thinking about well-being in broader terms—physical, financial, mental and social—really does make sense.”

To address physical health, wellness programs are expanding to include more online health solutions, such as virtual on-demand fitness classes and mindfulness exercises for a largely remote workforce. Although Best Buy has a 16,000-square-foot on-site fitness center at their corporate headquarters, when much of their workforce began working from home, the company implemented programs to bring the fitness center programs online, creating a “Wellness Zone” on Facebook where they host live group exercise classes and offering personal trainer sessions via Zoom.

Companies like Cisco have long provided primary care services through on-site clinics. But when the pandemic forced many companies to close their offices, some employers began offering co-pay waivers for telehealth consultations to ensure healthcare accessibility for remote workers. The online job-search company Monster and consulting firm KPMG introduced apps to help with meditation, sleep, and health education.

The pandemic has highlighted the role of chronic disease as a driver of increased risk for death and complications associated with COVID-19. Employees with a chronic disease are also especially vulnerable to productivity loss at work. Companies are placing greater emphasis on preventing and managing chronic disease in the workplace through more in-office and home health screenings to identify risk levels, issuing wearable health-tracking devices, and providing tools to help employees adopt lifestyle choices that promote immunity.

Employees with a chronic disease are especially vulnerable to productivity loss at work.

Some companies are turning to integrative care, a personalized approach to health and wellness that combines conventional healthcare with lifestyle changes including diet, exercise, and stress-relief techniques such as meditation and yoga. The millennial generation, in particular, strongly favors these holistic healthcare strategies. In a recent Welltok survey, 90% of that generation responded that they want support for emotional/mental health, adequate sleep, and positive family relationships. Studies have shown integrative care is more effective than conventional care alone, when measured in individual health outcomes and reduced healthcare costs. Now, companies such as Goodpath are providing integrative care directly to employees, with personalized digital health programs and perks.

Even before the pandemic, burnout, anxiety, and depression were among the health conditions that most contributed to lost productivity; mental health issues were the leading cause of disability and illness across the globe. The unprecedented stress and trauma experienced during the ongoing health crisis have led to as many as one-third of Americans developing mental health problems, making mental health a critical priority for pandemic-era wellness programs. More than half of employers surveyed by the National Alliance of Healthcare Purchaser Coalitions said they began offering special mental health programs to employees after COVID-19 lockdowns began. Last April, Starbucks began offering employees up to 20 free therapy sessions a year with a licensed mental health provider.

Studies have shown integrative care is more effective than conventional care alone.

When shutdowns and social distancing requirements all but eliminated opportunities for socializing, companies began recognizing the importance of maintaining social connections for mental health. Monster created opportunities for people to connect within groups related to particular interests, enabling employees to support each other in challenging situations. Compassionate leadership is a growing concern for employers who see a need to accommodate those who are dealing with the often-unseen challenges of the pandemic. KPMG started a program to ensure those in leadership positions are equipped to emotionally support employees. Research has shown employees who work in compassionate environments are more innovative and adaptable—and more satisfied with their jobs.

Companies are recognizing how important flexibility is to employee mental health and well-being. Many employers are extending the remote work period or are making remote work a permanent option. Google recently announced they will give employees who enjoy remote work the choice between fully remote work or a hybrid option. In addition, they will allow employees to spend up to four weeks per year working in a location other than their main office, enabling flexibility around summer and holiday travel.

Giving employees space to breathe in the form of meeting-free time or time off is becoming a popular well-being offering. Wiley, a global academic publishing company, has implemented “no meetings Fridays” and Google now has dedicated “focus time” when internal meetings cannot be scheduled. Monster aims to reduce employee stress by making “self-care days off’ an option for all employees. To help employees recharge, Google has begun offering extra company-wide “reset” days—days off when everyone is expected not to work. And Playground Global, a Silicon Valley venture capital firm, has implemented a week-long company-wide holiday each quarter.

Employees need—and expect—more assistance from employers as they navigate their pandemic and post-pandemic work lives.

Flexibility and services related to child-rearing have become important components of wellness programs, as parenting challenges during the pandemic highlighted the interconnectedness between family support and mental health. With many schools and daycare centers closed for much of the past year, parenting resources became one of the most-desired employee benefits. Wiley and Monster both provided teaching and tutoring assistance to parents who were suddenly responsible for overseeing remote learning. Facebook began offering expanded childcare benefits last summer. Pinterest and Salesforce now provide employees a family-benefits platform called Cleo that includes sessions with therapists, social workers, and experts in early-childhood development. Cleo CEO, Sarahjane Sacchetti, believes parent-support benefits will remain important to attracting and retaining employees long after the pandemic ends.

Research shows that financial stress is strongly linked to poor physical health. Rob Levy, managing director of the Center for Financial Services Innovation in Chicago, said anxiety about money can cost organizations $7,000 per employee per year: “People who are more financially stressed take more days off work for health-related issues.” More than half of workers had unhealthy finances before COVID-19 arrived in the US, say experts. The pandemic has only heightened economic uncertainties and financial losses, deepening the need for financial wellness benefits. A 2021 Bank of America survey found nearly 60% of employees are anxious about money and 83% of employees said financial wellness benefits are critical to financial security. In response, companies are getting more creative with financial benefits, offering financial literacy programs, stock options, retirement planning, and student loan repayment.

The new normal that has emerged from the global health crisis is poised to revolutionize the workplace. Employees need—and expect—more assistance from employers as they navigate the new stresses and concerns of their pandemic and post-pandemic work lives; and employers—well aware that their greatest asset is their employees—are really listening.