A new workplace survey reveals a disconnect between employers prioritizing health and dental insurance, health savings accounts (HSAs) and charitable contributions, while employees prioritize increased pay and 401(k) matches.

The annual “Voice of the American Workplace” survey which covers three areas — financial, mental and physical — found that American workers expressed a 15 percent year-over-year increase in concerns over financial health.

The survey also revealed that 91 percent of employers experienced turnover rates exceeding 10 percent in 2023.

Employee expectations, particularly regarding compensation, are on the rise, with 80 percent of employers struggling to meet demands for increased compensation.

This year’s survey examined both employer and employee perspectives, emphasizing the crucial need for aligning expectations with available resources.

“Managing heightened employee expectations is one of the biggest challenges facing employers today,” said Jacque Reardon, head of Client Marketing for Retirement, Insurance, 529 and Wealth Management for Franklin Templeton. “Understanding employee preferences and effectively communicating available resources is paramount for organizations aiming to attract and retain top talent. Employers must articulate the holistic value of total compensation and benefit packages to ensure alignment with employee needs and preferences.”

There appears to be a disconnect between offered benefits and employee preferences.

The survey reveals that employees prioritize increased pay (56 percent) and 401(k) matches (42 percent), while employers assume preferences for improved health and dental insurance, health savings accounts (HSAs), and charitable contributions.

Of the employees surveyed, 70 percent indicate their salary is not keeping up with inflation.

In addition, 49 percent of employers surveyed are providing access to resources like financial wellness platforms, yet only 28 percent of employees leverage them, and 72 percent of employees admit that they struggle to understand the benefits available to them.

Nearly a third (29 percent) admit they struggle to understand the monetary value of employer-provided benefits, the survey found.

Workers int he U.S. have expressed interest in more personalized offerings in their 401(k) and overall benefit packages — 84 percent and 82 percent, respectively.

Work-life balance is important, too, with 90 percent of employees increasingly seeking it to enhance their well-being.

“To address these challenges, employers must prioritize strategies focused on employee retention and satisfaction, which may entail offering competitive compensation packages and fostering positive work environments that prioritize employee well-being and work-life balance,” added Reardon. “By aligning with employee expectations and prioritizing their satisfaction, employers can mitigate turnover and cultivate a more engaged and productive workforce.”

Workers surveyed express heightened anxiety regarding income, retirement savings and healthcare costs, which surpass concerns about mental and physical health.

Two-thirds (61 percent) of workers feel that their financial independence is jeopardized by the current economic environment, as they struggle to achieve important financial milestones.

Other key concerns are recurring expenses (66 percent), healthcare costs (64 percent) and student loan debt (47 percent), and nearly half (47 percent) say their ability to retire could be in jeopardy due to the current economic situation.

“Each year, we’ve asked questions across three areas of health: financial health, mental health, and physical health,” said Reardon. “Generally, importance and concern are even across all three areas, but for the first time this year we see that financial health far outweighs concerns in other areas. In fact, there is a 15 percent increase year-over-year in concern over financial health.”

The survey was conducted by The Harris Poll on behalf of Franklin Templeton and the Retirement Innovation Initiative (RII).