With major medical costs experiencing double-digit increases, rising benefit costs continue to challenge employers in the U.S. These escalating costs, coupled with a tight labor market, push employers to seek solutions for their greatest business challenge: attracting and retaining employees.

Employers acknowledge that benefit programs have become a greater influence to employees in making employment decisions. Employee benefits impact both prospective employees in deciding on which employment opportunity to accept, and current employees who are seeking other employment options. Benefits represent the difference in attracting and retaining long-term employees to the job.

As a result, employers now recognize the need to look more closely at their benefits and HR practices. Employers are asking the question, "Am I using the most effective tools to compete effectively?" Some employers do not have the time or expertise to objectively assess and develop HR and benefits strategies. Others are undecided on how to best manage rising medical care costs -- reduce benefits, shift the increase to employees, or absorb the increase for fear of employees' reaction?

The factors many employers consider key to managing their benefit programs include:

• skyrocketing medical costs
• complex government regulations
• diverse work force
• need for better communications

To compound the benefits dilemma, another influence driving corporate change today is the way we communicate and interact. We all have increased access to information, which results in a new generation of more informed employees.

The Internet, supported by growth in information technology, has created significant change in how we access information, products, and services -- and this paradigm shift is projected to double every three years. Employees enjoy such access to more information for several reasons:

• First, they like the idea of being a better-informed consumer and buyer.
• Second, they like having the ability to make the buying decisions that directly impact them and their families.
• They value having greater flexibility and choice in their buying decisions.
• They also want increased access to information, at their convenience, about their compensation plan and other employee benefits.

CBG works with its client companies to help them manage their employee benefits program, as part of its business strategy. We also work with them to develop user-friendly tools to help their employees better understand and appreciate their benefits. By doing so, we support employers' efforts to use their employee benefit plans to improve business results and add value to their most valuable asset: their employees.