July 3rd, 2009 09:01am
Terri Burdick
I shared with you before that I’m intrigued by some of the facts and figures reported in the many resources that cross my desk. It’s been a while since I’ve shared some. Here are some recent ones worth thinking about:
· 49% Percentage of employees working in open-plan offices who are more likely to have high blood pressure than those working in walled offices. Source: Prof. Vinesh Oommen, Queensland University of Technology, Brisbane, Australia
· 300 million Estimated number of people in CHINA who can read and write English
· 252 million Estimated number of people in the US who can read and write English Source :Wired Magazine, Wikipedia
· 28% Percentage of American workers who admit they would act immorally – including lying or backstabbing – in order to keep their jobs Source: Newsweek
· 1 in 136 The chance that a 411 telephone call in the United States is handled by a federal prisoner. Source: Harpers
· $21,900 The amount of student loan debt shouldered by the average undergraduate college student upon graduation. Source: Project on Student Debt
· 82% Percent of recent job losses that have befallen men – heavily represented in distressed industries such as manufacturing and construction. Source: Bureau of Labor Statistics, Financial Times
· 68% Percentage of employers that expect normal hiring to return by the third quarter of 2009, according to a survey of 8,000 firms representing more than 4.5 million employees. Source: TalentDrive
· 60 Average number of months it takes for unemployment rates to drop to pre-downturn levels after a severe economic downturn begins. Source: Bloomberg, BusinessWeek
July 1st, 2009 02:14pm
Terri Burdick
My boss is great at uncovering ‘unintended consequences’ – those negative ‘surprises’ from well-intended change. With his guidance, I too, have become pretty good at looking at all the impacts of a particular decision to understand if there will be a result that was unplanned. These days I find myself thinking a lot about unintended consequences. Why? President Obama’s plans to transform and modernize America’s health care system have me concerned.
First, I should say I totally agree that something has to be done. Years of double digit health insurance cost increases and recent studies that outline falling quality of care are just two indicators that we can do better. Second, I agree that we live in a country where we should be able to provide basic medical care for our citizens. Third, I won’t pretend to have all the answers. But one thing I do know is that getting medical care when we need it will be an expected outcome of any type of health care reform and that’s where my whole worry about ‘unintended consequences’ comes into play.
One of the basic tenets of President Obama’s plan for health care is the need for expanded access to care. Such expansion would result in more American’s seeking medical care than are seeking it today. Many believe that this expansion would result in expanded wait times for care and evidence in Canada, England and other nations suggest that this would indeed be the case. But what may shock you is that even without this expanded access, such extended waits are already here!
Merritt Hawkins and Associates, a physician search and consulting firm, conducted a survey of 1,612 medical offices to track the average time needed to schedule a doctor appointment in 15 large metropolitan areas. The firm focused on medical specialties such as cardiology, dermatology, obstetrics, orthopedic surgery, and family practice.
They found that Boston had the longest average doctor appointment wait times: 70 days to see an obstetrician, 63 days to see a family physician, 54 days to see a dermatologist, 40 days to see an orthopedic surgeon, and 21 days to see a cardiologist. Next on the list were Philadelphia and LA with average doctor appointment wait times exceeding 45 days (notice that these wait times are in urban areas where most doctors practice).
If seeing physicians in a timely manner is a problem now, improved access to resources for medical payments will only amplify the problem. I know there is much to resolve when it comes to health care and some of what may need to be resolved is our own expectation for care. Whatever the case, I can only hope we move thoughtfully to lessen the impact of the unintended consequences of change.
To learn more President Obama’s Plan for Health Care, visit www.healthreform.gov.
June 16th, 2009 02:59pm
Terri Burdick
It’s no secret that we’re in a financial crisis and our employees are feeling the stress of that crisis in their personal finances. As employees look for sources of money to bridge the gaps created by reduced family income, borrowing against their retirement funds is becoming a popular option. A survey of 245 large employers conducted by Watson Wyatt Worldwide in February, 2009 found that 45% of companies are seeing more 401(k) loan activity. Is taking a loan from a 401(k) a good idea? Let’s look at some of the issues related to borrowing from a 401(k) account:
· As long as the employee meets the minimum account balance requirement, they are eligible for the loan. There is an application process, but no credit approval necessary. They are borrowing from themselves. This could be a good thing for employees facing credit challenges.
· While the interest rates are typically favorable, the interest is not tax free and the loan and interest must be repaid using after-tax dollars. All these tax implications only add to the total cost of the loan.
· Employees are required to begin repayment on the loan immediately, usually through payroll deduction leaving less in their already stretched paycheck to cover day-to-day expenses.
· Borrowers are often charged a loan-origination fee and may be charged an additional annual administration fee for processing their loan payments. Typically these fees are upwards of $75 each year – a pretty expensive surcharge.
· Employees who lose their job or change employers while they still have a balance on their 401(k) loan face additional risks. Some Plans require the outstanding balance to be paid back at the time of employment termination or the outstanding balance is reported to the IRS as a taxable distribution. Depending on the worker’s age, there may also be an early-withdrawal penalty that would apply to the loan balance that was treated as a distribution. The tax consequences could make the loan very expensive, very quickly.
· Earnings on the employee’s 401(k) plan are also impacted by the reduction in the account balance during the time the loan is being repaid. Even though the employee is borrowing from their own account and repaying themselves, the amount of the outstanding loan is ‘lost’ to earnings during the repayment period. This will impact the total account balance available at retirement.
So, is borrowing from your 401(k) account a good idea? I’d say only as a last resort. The long term earnings impact, tax implications, and fee charges make it a good decision only for those employees with the most challenged credit. Times may be tough today, but I’d hate to trade a tough today for a potentially tougher tomorrow if I didn’t have to…
June 2nd, 2009 01:30pm
Terri Burdick
Kiplinger is reporting that employers are experiencing health care costs increasing more than expected during a time when they can least afford it (+7.5% actual, +6% expected). The spike is attributed to increased utilization – more doctor visits, more testing, more dental visits, etc. This is a common occurrence in a recession and is driven by both an increase in stress related illness and a concern that benefits may be lost, so best to use services while you still have insurance.
A recent study by Mercer reports that employers will be looking to make plan changes in 2010 that limit their overall increase to an average of 5.2%. How are employers saying they will do that?
The most popular cost control tool being explored for 2010 will be a transition to a consumer directed health plan (CDHP). Halleluiah! I’ve written many times that getting people involved in their health care decisions through the use of first dollar responsibility is critical to future medical cost control and improved individual health! It’s too bad employers have waited until such a move feels punitive to get on the consumer-directed band wagon!
Consumer directed health plans (commonly referred to as HSAs or HRAs), combine a high deductible health plan with a tax-advantaged saving account. Employers experience reduced premium costs due to the higher deductible and employees receive tax savings on the dollars they set aside for future medical expenses. The average cost per worker of a CDHP is about $6,000 annually versus $7,800 annually for a traditional PPO plan. In addition, about 60% of employers with CDHP’s make a contribution to the employee’s tax saving account to assist in funding the out-of-pocket medical expenses.
Arguably, there are pros and cons to CDHP, but studies show no better tool for getting people actively engaged in their health care choices. As you prepare for your 2010 medical plans, be sure to include a CDHP in your consideration.
For the full Kiplinger article, go to: www.kiplinger.com/businessresource . The article ran on May 21, 2009.
May 29th, 2009 09:06am
Terri Burdick
If I asked you, or your Company leadership, if they are supporting a healthy workplace, I’m sure many of them will share information about their commitment to safety. Granted, safety is important, but being safe is just one element of good health. What I’m really getting at here is, “Does your Company support activities and behaviors that result in healthy employees?” Still don’t know what I’m getting at?
· Does your Company vending machine offer healthy snacks amidst the chocolate, chips and pastries? If so, how do employees know? Are calories and nutrition listed on the outside of the machine for each vending option?
· Does your Company host pot-lucks or luncheons that include or encourage healthy entrees?
· Does your Company offer water or caffeine-free options to the sodas in your soda machine?
· Does your Company encourage fitness activities such as group walks during breaks or lunch?
· Does your Company offer fruit or other healthy options in addition to celebratory donuts, cakes and cookies?
NO? Why not? These are all easy ways a Company can support healthy lifestyles for their employees — all without spending a dime on fancy wellness programs. Healthy employees are more productive, off work less frequently for illness, and have lower medical costs than unhealthy employees. It’s worth your time to make healthy choices available for your team. It’s a WIN – WIN!
May 27th, 2009 09:31am
Terri Burdick
It strikes me that in today’s economy, it’s critical for customers to understand who you are as a Company. They want to be clear about what they can expect from you in the way of information, education, service, follow-up, and more. There is no better time to be crisp about how everyone in your Company ‘lives’ your brand.When I say ‘brand,’ I’m not just talking about your advertising messages. While that’s one avenue customers can use to learn about you, your ‘brand’ is MUCH broader than that. An effective way to think about ‘brand’ is to think of it relative to the senses: – everything a customer sees, everything a customer touches, and everything a customer hears regarding your Company contributes to your brand. It’s important that these elements work together to paint the picture you want your customer to have. The more consistent these sensory experiences, the more cohesive and strong your brand will be in the mind of your customers.Here are some things to consider towards aligning these sensory experiences:· What does the client see when they enter your location? Is parking convenient? Is the parking lot clean or are their cigarette butts and fast food bags on the ground? If you’re flying a flag, is it in good condition? Is your landscaping neat and trimmed or tired and weedy? · How is the interior environment? Are the walls a pleasing color? Are the work areas orderly or covered with post it notes, piles of paper, clutter? Is the carpet worn? Clean? Do your clients wonder if your work environment is unorganized, how can you provide ‘organized’ service?· What is the tone of your customer communications? Is the tone personal and approachable, punitive, formal and intimidating? Do you have a corporate ‘’style’ that allows a customer to identify a communication as coming from your Company if they just glance at the document?· What does the phone greeting sound like when a customer calls? Is it warm and welcoming, curt and perfunctory, professional but pleasant, fast and impatient?· What tone and words do employees choose when speaking to customers? Are they choosing words that are caring, professional, and resourceful or filled with jargon, impatience, or frustration?All of these clients ‘touches’ impart information about your brand and who you are that is much more powerful than your advertising. Your brand is about the experience. There’s value in stepping back, watching, listening and evaluating if the actions of ‘who you are’ are really ‘who you want to be.’
May 6th, 2009 01:19pm
Terri Burdick
Today we have more channels than ever to communicate with employees. The advent of Company websites, intranets and email followed by the wide-spread use of Blackberry devices and other hardware that keeps us connected 24/7 has changed the way we share information with our employees. Most of these channels are ‘self-service’ with information posted for review and consideration at a time convenient to the employee.
Sounds good, right? With all the information available at a time they can choose, shouldn’t our employees feel more connected, more informed and well-communicated? Perhaps they should, but the answer to that question is a resounding NO – particularly as it relates to communication about their benefits.
· Only 1 in 4 employees think benefits communication is effective, according to the MetLife 2008 Employee Benefits study.· In focus groups related to the study, employees made comments like: “HR communication doesn’t respect my time,” “There’s too much jargon” and “I often don’t understand what I’m supposed to do differently.”· As a result of poor communication, employees have a low understanding (and appreciation for) their benefits. Only 44% of employees are satisfied with their benefits and 55% don’t understand critical details about their insurance. So what is an employer to do?
· Insure that ‘self-service’ benefit education (i.e. on-line education) isn’t the employee’s only option for getting information. Old-fashion small group or individual face-to-face communication is still THE BEST WAY to talk with employees about their benefits.
· Share important communication three times in three different ways. There are some employees for whom electronic communication is their preferred learning style. Other employees, however, don’t learn as well by reading. They may need to hear the message or read it multiple times (e.g. an email followed by an employee newsletter article) or ‘touch’ the communication content in some way – like having to fill something out that demonstrates learning. The greatest gift you can have relative to communication is an employee who complains they are tired of getting the same information over and over. You should smile broadly when that occurs knowing your communication was a success.
· Remember that ‘communication’ is a service you provide to your employees. If you are always asking them to serve themselves, it’s important to ask, “Where is the service?” Don’t let what is convenient to you drive the success of your emloyee communications.
April 24th, 2009 09:10am
Terri Burdick
With yesterday’s headlines that Beloit, WI unemployment leads the State at 17.7%, it’s easy to believe there are no jobs to be had. Some bright spots do exist however in this rather dismal job market.
According to the federal Career Voyages website, a project of the U.S. departments of Labor and Education, the Top 10 “In-Demand” Occupations are:
1. Registered nurses
2. General and operations managers
3. Physicians and surgeons
4. Elementary school teachers
5. Accountants and auditors
6. Computer software engineers
7. Sales representatives and managers
8. Computer system analysts
9. Management analysts
10. Secondary school teachers
What do all these occupations have in common? They ALL require post secondary school education.
If you’re still reading this and these positions aren’t in your industry, you may be saying, ‘So what? Why does this matter to me? What am I supposed to do about it?” Even if not in your industry, these positions are important to long term communication infrastructure, healthcare, and the education of our next generation. Here are some thoughts about how you can support the needs:
· Get your employees involved as youth mentor volunteers. Anything we can do to keep students in school and learning is a step in the right direction.
· Support tuition reimbursement for workers continuing their education
· Host students at your worksite to help them understand what opportunities exist locally. We need to keep our best and brightest in our communities to contribute for the long term.
To learn more about Career Voyages, see their website: www.careervoyages.gov.
April 22nd, 2009 07:56am
Terri Burdick
When we think about President Obama’s economic stimulus package our first thoughts most likely go to the billions of dollars earmarked to assist troubled banks and other institutions. The package, however, is far more reaching than just dealing with troubled industries and includes dollars targeted to impact health care that will ultimately result in changes to employee health benefits.
· The creation of a Federal Coordinating Council for Comparative Effectiveness Research. This 15-member Board will have the authority to spend $1.1 billion to investigate the effectiveness of different drugs and medical devices. Designed to help us understand what is effective medical care and what isn’t, the work of this Board may result in what prescription drugs and medical devices are covered by medical insurance.
· Expansion of computerized information for healthcare. A continuation of work by the previous administration, $20 billion has been allocated for more effective use of communication technology in healthcare. These improvements should reduce costs through improved communication between multiple providers, reduced errors caused by a lack of information or miscommunication, improved billing efficiency and more.
· COBRA assistance subsidies. The biggest healthcare benefit provides assistance to unemployed workers. Anyone who lost their job involuntarily between September 1, 2008 and December 31, 2009 will be eligible for a premium subsidy of 65% of the cost of coverage continuation for up to nine months. Notification requirements to employees and information on how to administratively manage the subsidy can be found at the www.dol.gov.
April 1st, 2009 02:32pm
Rick Bastian
The Obama administration announced this week that it would accept a bankruptcy from GM and pretty much didn’t care what happened to Chrysler. Chrysler was given thirty days to conclude a satisfactory deal with Fiat or effectively file bankruptcy and liquidate. Fiat’s bond rating was downgraded to junk status at the mere thought of any deal for Chrysler. This may be a bluff by the administration to get the recalcitrant stakeholders to the table, but I doubt it. The business prospects for the automaker may be that bleak, but the implications for the Rock River Valley are devastating.
The bankruptcy or liquidation of Chrysler would lead to soaring unemployment as pink slips are handed out to employees of the company and its suppliers in the area. Retail and housing will have a shock unlike anything we have ever seen. With this enormous cloud over the brand’s head, no one is going to buy a Chrysler product, no matter what the incentive. Chrysler dealers, who haven’t been particular well treated by the company, would fold up by the score.
The Belvidere plant is too technologically advanced to be closed for good. Some car company (the Germans, Indians or Chinese) will want it and may even want the Jeep brand. It will be cheaper for them to get it through the bankruptcy court which will also likely relieve the company of a lot of the UAW legacy costs. It will be run more like an auto plant in South Carolina than one in Detroit. The transition from here to there will be very painful for the area, but, in the end, we will have to say it is better to have something better than nothing.
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