A report from the Economist Intelligence Unit

The wellness effect

The impact of workplace programmes

Sponsored by

The wellness effect: The impact of workplace programmes

Introduction
In October 2015 The Economist Intelligence Unit (EIU) conducted a study that included
surveys of both executives and employees at companies that operate employee
wellness programmes. The research, sponsored by Humana, seeks insights into thescope, reach and impact of wellness programmes, as well as the challenges andopportunities that continue to inform their development. All respondents are based in
the US and have direct knowledge of their company’s employee wellness
programmes.
The study finds that employers’ efforts to establish a culture of wellness have beenbroadly successful, and that HR executives tend to have a good grasp of thechallenges that still need to be addressed. Employees are keenly aware of whether or

Employees arekeenly awareof whether or
not they work
for anorganisation
with a cultureof wellness.

not they work for an organisation with a culture of wellness; their perceptions that
health and wellness is an important part of their organisation’s culture are largely
shaped by the design and accessibility of workplace wellness programmes. Moreover,a wellness culture magnifies the benefits that employees gain from their participation
while driving increased engagement, especially if they offer a wide range of choices.
Lack of time is seen by both executives and employees as the biggest obstacle tohigher participation rates.
The study results also reveal the cost of not building a wellness culture—on employee
happiness, stress levels and, dramatically, engagement with the employer’s mission
and goals. In addition, distinct differences emerge as to what employers andemployees consider the most effective approaches to wellness. Employers place far
greater emphasis on stress management programmes, for instance, while employees
are much more likely to cite flexible work schedules.
Large and small organisations differ in their reasons for offering wellness programmes,
according to the EIU research. Small organisations lag in establishing a comprehensive,robust wellness culture. However, the study also finds that many small organisations
have the agility needed to understand employee needs and move quickly to build asense of community around health, wellness and employee well-being (see“Challenges and opportunities for smaller organisations”, page 6).

1© The Economist Intelligence Unit Limited 2016

The wellness effect: The impact of workplace programmes

A competitive advantage for companies witha wellness culture?
Sixty-nine
percent of
employees
agree that
health andwellness are an
important partof theirorganisation’s
culture.

A “wellness culture” is more than just words: it is defined not only by an array ofprogrammes that encourage and support health and wellness for employees—fromstress reduction to improved diet—but also by physical and environmental features
such as better-quality cafeteria food and pleasant, relaxing spaces for breaks.
Employees know when they are working for an organisation that promotes health andwellness and when they are not. The EIU research finds, on the whole, that US
employers have been reasonably successful at establishing a workplace culture ofwellness: about seven in ten employees (69%) agree that health and wellness are an
important part of their organisation’s culture.
But the differences in employee perception between companies that have awellness culture and those that do not are stark. Employees who believe they work for acompany with a defined culture of wellness are twice as likely to say that existingwellness programmes are well designed and useful (89% vs 43%) and almost twice as
likely to say they are easily accessible in terms of time and location (83% vs 42%). Thesefindings suggest that employers who put in the work to tailor their wellness programmes
to specific employee needs and make them as accessible as possible may enjoy acompetitive advantage in terms of attracting and retaining valued employees.
“Employers are beginning to understand that culture is important,” says Dr Michael
O’Donnell, director of the Health Management Research Center at the University ofMichigan’s School of Kinesiology. “By taking stock of their culture, employers can figureout what the norms are now—and how they can change them.”

About the surveys
The employer survey, conducted in October
2015, includes 209 human resources (HR)executives and managers at US-based
companies who have direct knowledgeof their company’s employee wellness
programmes. About a quarter of themwork for organisations with between 2 and49 employees, nearly half have 50-1,000
workers and the remainder have 1,000
workers or more. A wide variety of industries
are represented.
The employee survey, also conductedin October 2015, includes 500 full-time

2© The Economist Intelligence Unit Limited 2016

workers based in the US, all of whom
participate in an employer-provided
wellness programme. Respondents areevenly divided between male and female,and each of the three main generationalgroups (Baby Boomers, Generation X andMillennials) is well represented. The majorityof respondents are university-educated.
One in five works for a company with 2 to 49
employees, two in five work for companies
with 50 to 1,000 employees and theremainder work for companies with morethan 1,000 employees.

The wellness effect: The impact of workplace programmes

CHART 1 Wellness programmes get results
To what extent do you believe your participation in wellness programmes has had an impact
on each of the following areas?
% of employees who believe their participation has had an impact

Employees who work in a wellness culture
Employees who do not91

Fitness

76
89

Overall happiness or well-being

76
80

Diet

61
77

Stress65
81

Weight management

68
67

Engagement in my employer’s mission and goals
Smoking cessation

31
24
19
Source: Economist Intelligence Unit survey, 2016.

A wellness culture builds employee engagementwith company goals
The gulf between organisations that have established a wellness culture and those thathave not shows up consistently across all areas of employee health and well-being.
Employees who work in a wellness culture are less likely to experience health-related
barriers or setbacks—for instance, work-related stress is less likely to take a toll on theirhealth (56% vs 68%) and professional obligations are less likely to interfere with theirability to make healthy choices regarding food and exercise (48% vs 57%).
The benefits of a wellness culture extend beyond office walls: employees at thesecompanies are less likely to say that they face significant barriers to managing theirhealth and wellness outside of work (27% vs 35%). They report substantially better resultsin terms of fitness, weight management and, perhaps most notably, overall happiness
and well-being (see Chart 1).
Most critically for employers, however, the EIU research offers striking evidence thatwellness programmes align employer and employee goals more closely. They increase
employee engagement with the company’s mission and goals. Employees are also
more likely to see their own wellness as being linked with professional success.
Companies that build a wellness culture thus acquire a workforce that is not only more
focused and engaged, but that sees that culture as benefiting their careers.
A closer look at companies that are leaders in employee engagement underscores
the strong role played by comprehensive wellness programmes—ie, those that provide
employees with a wide selection of individual components—in helping them toachieve greater employee engagement with the company’s mission and goals. We

3© The Economist Intelligence Unit Limited 2016

The wellness effect: The impact of workplace programmes

CHART 2 Wellness and employee engagement go hand-in-handWhich of the following features does your organisation’s wellness programme currently include
and which are priorities for the future?

Employee engagement leaders
Non-leaders% of employers
Group wellness activities or challenges

48

33

Formal privacy guarantees for employer-held data
Group education programmes

41
41

21

Healthy food options

35

27

Individual counselling programmes

34

28

Disease management services

31

26

Financial incentives
Personalised health and wellness monitoring reports

A wellness
culture is mostsuccessful—and contributes
most strongly tobuilding
employeeengagement—
when itincludes anarray ofprogrammes
and activities.

38

26

Onsite health and wellness services

25

Reduction in healthcare premiums

31
30
29
29

23

Integration of employees’ personal goals

44

25

14

Source: Economist Intelligence Unit survey, 2016.

define “engagement leaders” as companies that are above average relative to peersin achieving employee engagement. Respondents at these companies are more likely
than others to say their organisation offers every programme component listed in theemployer survey, ranging from group education programmes to healthy food options(see Chart 2). This suggests that a wellness culture is most successful—and contributes
most strongly to building employee engagement—when it includes an array ofprogrammes and activities.
CHART 3 Why employees fail to participate
In your opinion, what are the most important obstacles to greater employee participation in
employer-provided wellness programmes?
% of respondents

Employer
Employee46

Employees don’t have enough time to participate inwellness programmes in addition to other responsibilities

51
34

Employees don’t perceive health andwellness as a high priority

26
24

Employee don’t believe the rewards
are worth the time and effort

19
23

Employees don’t believe that wellness programmes
will lead to significant improvements in their health21
21

Employees distrust employer motives

12

Employees lack the guidance from programme delivery
personnel and resources they need to realise their goals

11

Existing wellness programmes don’t
adequately address employee goals

10
9

16

Source: Economist Intelligence Unit survey, 2016.

4© The Economist Intelligence Unit Limited 2016

The wellness effect: The impact of workplace programmes

CHART 4 What motivates employees to participate?
Which of the following approaches do you believe would be most effective in promoting
the concepts of health and wellness in your organisation’s culture?
% of respondents
Stress management programmeGroup activities and competitions

36
35

28

44

34

More flexible work schedules

32

Healthier food options in break rooms and cafeterias
Greater emphasis on ergonomics in workspaces

25

17

Appointment of “wellness champions”

22

14

Financial counselling

15
12

Guided meditation/Yoga classes

9

37

29

20

Better integration of individual and company goals

48

30

22

Participation in wellness activities by top
executives and business-unit leaders

Family counselling

Employer
Employee171811
Source: Economist Intelligence Unit survey, 2016.

The biggest impediment to employee participation:lack of time
Given the benefits of participation in wellness programmes, why don’t more employees
choose to join in? The most important explanation is that there are simply not enoughhours in a day: employers and employees agree that the biggest obstacle to greater
wellness programme participation is lack of time in addition to professional duties. This
ongoing challenge likely contributes to an employee preference for one-time events
such as in-person health assessments, in which a large majority say they are at least
somewhat likely to take part, and one-time workshops. Long-term programmes, which
require a more formal time commitment, are somewhat less popular.
Other major obstacles cited by both groups relate to the perceived effectiveness ofwellness programmes, including lack of confidence that the rewards are worth thetime and effort or that participation will lead to significant improvements (see Chart 3,
previous page).

5© The Economist Intelligence Unit Limited 2016

The wellness effect: The impact of workplace programmes

Challenges and opportunities for smaller organisations
Small
companies
differ in theirreasons forcreating awellness
culture: they
are less driven
by cost-control
concerns andmore byworkforcerelated issues.

A major finding of the EIU research is that
small companies lag in establishing awellness culture. Over three-quarters (76%)
of employees at organisations with over
1,000 employees agree that health andwellness are part of their company’s culture,compared with 61% at firms with fewer than
50. Smaller companies have fewer resourcesat their disposal, says Dr O’Donnell, directorof the Health Management Research Centerat the University of Michigan’s School ofKinesiology. Employees are more likely to
say they lack time to participate in wellness
programmes at small companies than atlarge ones, and to question whether the
rewards are worth the time and effort.
Small companies also differ in their reasons
for wanting to create a wellness culture: they
are less driven by cost-control concerns, andmore by workforce-related issues (see chart).
For example, smaller organisations are more
likely to cite improving employee productivity
and reducing stress as reasons for creating awellness culture, while large companies are
more likely to cite reducing health plan costs.
This suggests that the drive to implement
wellness programmes and policies may be
weaker at small companies. Dr O’Donnell

points out, however, that greater agility may
make it easier for small companies, should
they choose to do so. “Small employers canhave great programmes when leadershipmakes them a priority because setting policy
and allocating resources can happen very
fast. Reaching all staff is easy and a senseof community around health can be built
quickly and be maintained,” he says.
The EIU survey reveals other advantages
enjoyed by smaller firms. Employees at small
firms are less likely to distrust their employer’s
motives than those at larger organisations,and their firms are more likely to be in
the early stages of wellness programme
development. While this leaves them withlower employee participation rates, itaffords them flexibility in programme design,especially in areas that might be difficult toquantify.
Making the healthy choice the easiest(or the only) one is also key to increasing
participation rates, regardless of company
size, Dr O’Donnell believes. “People will eat
nutritious food if it is easy to find, delicious
and affordable—and if junk food isexpensive, hard to find or not served at all,”he says.

Why employers offer wellness programmes
Which of the following are the most important reasons for your organisation tooffer a wellness programme to employees?

Small orgs (2-49)
Medium orgs (50-1000)
Large orgs (1000+)% of respondents
50

Improving health outcomes
38

Reducing employer health plan costs
Improving employee productivity

34
34

26

Reducing employee health premiums

Attracting and retaining top talent

6© The Economist Intelligence Unit Limited 2016

32

22
21

16

Improving employee engagement
10

12

67

31

15

Reducing employee stress

54

58

36

22

Improving employee morale

53

25

21

39

42

27

Source: Economist Intelligence Unit survey, 2016.

The wellness effect: The impact of workplace programmes

CHART 5 Evaluating the results
Which of the following approaches does your organisation employ to evaluate theperformance of its wellness programme?

Small orgs (2-49)
Medium orgs (50-1000)
Large orgs (1000+)% of employers
Employee surveys

33

We don’t evaluate programme
performance

30

13

9

One-on-one interviews

22

Wellness programme participation data

Third-party audits

27

14

Health assessment data

8

4
7

60

18
16

Health claims data

42

22

14

Absenteeism or healthy days data

Biometric/Clinical screening data

42
38

24

15

38

43
32

28

49

39

11

Source: Economist Intelligence Unit survey, 2016.

The biggest challenge to employee wellness: stress
Seventy-one
percent of
employees
agree thatwellness
programmes
can have atleast amoderate
impact on
lowering stress;
yet only 14%
regularly
participate in a
stressmanagement
programme.

7

Stress remains a serious problem in many workplaces, the research reveals. Over half of
employee respondents believe work-related stress has taken a toll on their health—only
about one in three disagrees—and a similarly large proportion say work obligations
interfere with their ability to pursue a healthy lifestyle.
Wellness programmes can have at least a moderate impact on lowering stress, withnearly three-quarters of employees (71%) agreeing. Yet only 14% of employees say they
regularly participate in a stress management programme. Indeed, the study reveals a
disconnect between employers and employees regarding what they believe are themost effective means of promoting health and wellness. About 44% of employers saystress management programmes are among the most effective tools, compared with
only 36% of employees. By contrast, nearly half (48%) of employees include more
flexible work schedules among the most effective means of promoting health andwellness, versus 34% of employers (see Chart 4, page 5).
This suggests a disagreement as to what is the best way for companies to alleviate
stress: through focused stress management programmes, or simply by providing more
flexible hours. Employers may want to look more carefully at other wellness tools that
could help to reduce stress, even if they are not explicitly designed to do so.

© The Economist Intelligence Unit Limited 2016

The wellness effect: The impact of workplace programmes

Comprehensive programme evaluation
remains elusive❛❛Many
employers do
not do a goodjob ofevaluating theirprogrammes.
When they
conduct aformalevaluation,
they often
focus on healthand medical
cost
outcomes...
they neglect tomeasure theimpact on theirotherorganisational
priorities.
❜❜
Dr Michael O’Donnell,
Director of the HealthManagement ResearchCenter, University ofMichigan School ofKinesiology

8

While companies of all sizes—even many smaller companies—have established awellness culture or made progress in that direction in recent years, evaluating theperformance of wellness programmes is a significant challenge. Small companies,
especially, lag in this respect: more than one-third say they don’t evaluate programme
performance at all, compared with just 15% of large organisations. However, as manyas 40% of large firms say they do not use programme participation data to evaluate
performance, and fewer than half utilize health claims data, health assessment data,or biometric/clinical screening data.
A 2014 study, “Measuring wellness: From data to insights”, conducted by the EIU andsponsored by Humana, concluded that the main reason many employers havedifficulty assessing wellness programme performance against the full range ofobjectives is that the most easily quantifiable cost data cannot capture less-tangible
outcomes such as improved health and reduced stress. “Many employers do not do agood job of evaluating their programmes,” says Dr O’Donnell. “When they conduct aformal evaluation, they often focus on health and medical cost outcomes, and theyneglect to measure the impact on their other organisational priorities.” Programme
assessments can often be supported by data collected for other purposes, he points
out. “The beauty of something like a health screening is that you’re using it forsomething besides evaluation. It provides employees with information that’s interesting
to them and also can help point them in the right direction. Then when you do it again
over time you’ve got the benefit of true evaluation.”Interestingly, some small organisations may be better positioned to capture thebroader, less quantifiable benefits of wellness in their evaluations. While larger
organisations tend to favour more data-oriented approaches to assessing programme
performance, smaller companies lean towards the more personalised, hands-on
approach of one-on-one interviews.

© The Economist Intelligence Unit Limited 2016

The wellness effect: The impact of workplace programmes

Conclusion:
A wellness culture is not only desirable butachievable
Experience with wellness programmes has left many employers with a goodunderstanding of their benefits and challenges, and most have identified opportunities
for improvement. Most employers have been successful at building an organisational
culture that supports health and wellness, and employees who perceive that a wellness
culture has been established point to substantial positive impact in both their working
and personal lives.
But the advantages these companies enjoy also underscore the hazards fororganisations that do not pursue a wellness culture. These companies run the risk that
employees will not value the health and wellness benefits they do offer, and, morecritically, that employee engagement will suffer. This could translate into a competitive
disadvantage with respect to retention of valued employees. Smaller organisations, inparticular, must do a better job evaluating the performance of their wellness
programmes, or miss out on some of the advantages they offer.
The most dramatic gulf the EIU research found was not between organisations ofdifferent sizes, however, but between those that have established a wellness culture
and those that have not. Yet, employees who say their company has a wellness
culture, regardless of size, report better outcomes across a broad range of concerns,
from fitness and diet to overall well-being and engagement with the employer’s
mission. Such a culture, the EIU research shows, is not only achievable for a broad
range of companies, but can provide them with an important competitive
advantage.

9© The Economist Intelligence Unit Limited 2016

The wellness effect: The impact of workplace programmes

Whilst every effort has been taken to verify theaccuracy of this information, neither The Economist
Intelligence Unit Ltd. nor the sponsor of this report can
accept any responsibility or liability for reliance by any
person on this white paper or any of the information,
opinions or conclusions set out in the white paper.

10© The Economist Intelligence Unit Limited 2016

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