Editor’s note: You may download the 2021 healthcare industry severance and workforce transition report here.
If healthcare spending was once believed to be immune from the worst effects of economic downturns (largely thanks to insurance), the broad-scope disruption brought about by a global pandemic quickly dispelled that myth. In fact, despite the classification of many healthcare employees as 'essential workers,' the industry as a whole hemorrhaged a staggering 1.4 million jobs in a single month after the outbreak of COVID-19, and another 44,000 in the first quarter of 2021.
With such an uncertain backdrop, you might safely assume that most healthcare organizations have made cost-conscious changes to their severance offerings, right?
We surveyed HR leaders (from HR managers to CHROs) at healthcare companies around the world to find out. Here's what they told us.
four high-level trends in health care
What's the state of severance and workforce transition in the healthcare industry today? We crunched the numbers and discovered the following four dominant trends.
#1: Despite having to cut jobs, healthcare companies are focused on the employee experience.
You can see this reflected in the data around severance most clearly. For example, healthcare companies are more likely than organizations in other industries to have made changes to severance to improve the employee experience, better attract talent and reflect the new needs of today's talent.
#2: Severance isn't just for senior-level executives anymore.
On the contrary, healthcare companies are actively expanding eligibility: 64% now offer severance to everyone. What's more, 15% offer one year or more of salary as part of their severance packages. That's a higher percentage than we found in any other industry in our survey.
#3: Healthcare companies could still make greater headway on redeployment.
HR leaders at one in three healthcare companies said that partnering with an external consultant would make their organization's redeployment program more effective – twice the number (14%) of respondents who thought so two years ago.
#4: When layoffs occur, employer branding suffers.
Interestingly, healthcare companies are more likely than their counterparts in other industries to experience an uptick in negative reviews (52% vs. 46%) in the aftermath of layoffs. It probably doesn't help that 39% of organizations in the field don't conduct exit interviews when layoffs occur. Such interviews can help employers better understand how departing employees view their experiences with the company – a critical step toward making organizational changes that improve sentiment and employer brand.
a closer look at improving redeployment
When it comes to redeployment, there's nearly always room for improvement. But where, specifically in the context of healthcare, should leadership focus their energies? Three areas stand out:
- Nearly half of respondents said their organizations could do a better job of matching employees to open positions.
- Another 41% indicated that career coaching – to help ease the transition period for impacted employees – would be a significant benefit.
- Meanwhile, one in three acknowledged that partnering with an external consultant could help move the needle, more than double the number (14%) in 2019 who said the same. It's a clear sign that providing services such as coaching, resume writing and personal branding, skill building and online resources make a tangible difference.
how the healthcare industry lags behind on employer branding
The advantages of successful employer branding are difficult to overstate, particularly given the high-volume hiring demands – as well as lingering talent shortages – on the horizon for many healthcare organizations.
What is surprising, in that light, is how many of them appear to be missing an opportunity to attract the best talent by promoting a positive employer brand. Consider that more than one in four healthcare companies currently does not have any kind of formal program in place to protect and improve their employer brand. The corresponding figure among wholesale/retail and CPG employers is just 12%, by contrast. In this department, healthcare companies have their work cut out for them – and some catching up to do.
additional changes on the horizon for healthcare companies
As we mentioned earlier, healthcare companies aren't just democratizing severance eligibility, but making severance itself far more generous, too. Look no further than the fact that 15% of respondents said their company offers one year or more of salary as part of their severance packages – a larger percentage than we found in any other industry.
It's also interesting to see that some talent-strapped employers in the field are planning to take their offerings to new heights, too. How so? Notably, by bolstering health benefits. This is an obviously appropriate move for employees working on the front lines of the pandemic — and it appears to be the top priority among healthcare companies planning changes to their severance policies.
key takeaways for the healthcare industry
Enhanced severance benefits and expanded eligibility. A continued focus on the employee experience. Lingering challenges with redeployment. When it comes to severance and workforce transition, it's clear that the healthcare sector is finding success while navigating continued disruption.
Want more in-depth insights about how today's healthcare organizations are evolving when it comes to severance and workforce transition? Download your copy of our industry report today.