Construction spending is projected to exceed 1.45 trillion U.S. dollars in 2023 — up from the 1.29 trillion dollar value in 2018. Construction manager and engineer working on building siteAlthough the continued uptick is a good thing, many construction companies find it difficult to recruit skilled workers to meet the steady demand.

This challenge is even greater for small- to medium-size business owners as they find themselves competing with large construction companies with deep pockets and traditional group health care packages. And with traditional group insurance comes participation requirements, administration complexity, and high costs that just don’t make sense for many of these smaller businesses.

As a result, many construction companies are looking for other ways to reimburse their workers for health care. This is where a health reimbursement arrangement (HRA) can help your small construction business and here’s why.

HRA Benefits for Construction Firms

Effectively manage costs

We understand that no construction project is the same and so small construction firms operate differently than most small businesses. That’s why we know flexibility is key to managing your cash flow successfully.

An HRA is a good fit for a small construction company like yours as it offers the ability to offer tax-free money to its workers for health care expenses. Your small business can decide in advance the amount of money to contribute, with the flexibility of adjusting the amount based on budget constraints throughout the year. It’s great for your workers too as they have the flexibility to use the allowance to purchase the health insurance and services that best fit their needs.

There are different types of HRA plans, each tailored for different types of businesses. You can learn what type of HRA may be best for your construction business here.

Hire and keep top workers

With construction workers spanning from baby boomers to millennials, Construction worker with a crane in the backgroundoffering a health benefit that works for all types of employees is crucial – especially when it comes to recruitment and retention.

An HRA is appealing for all types of construction workers as it gives them the flexibility to choose the health insurance and eligible expenses that best suit them. The flexibility and cost savings inherent in these tax-free plans make HRAs a great recruiting tool as workers recognize its value and fairness, regardless of their age or situation.

Go here to learn what our construction customers have to say about their PeopleKeep experience.

Simplify administrative processes

Running a small construction business can be administratively demanding. With massive amounts of records, regulations, and timelines to stay on top of it’s no surprise that work-life balance is especially tricky for small firms.

Fortunately, adding an HRA through PeopleKeep doesn’t add more to a small firm’s administration burden. Both you and your employees can administer the HRA in just minutes a month through PeopleKeep’s easy-to-use, cloud-based software.

Yes, it's just that simple! Once you set the employee allowance amount, PeopleKeep educates your employees on their HRA plan and how to use it. Your employee buys the health care plan and services, and uploads expense documentation to their account. Next, PeopleKeep verifies the expenses and notifies you and your employee of the verified amount. Then, you simply add the verified amount to your payroll and reimburse your employees on your own timeline.

What about keeping up with the ever-changing health care regulations? PeopleKeep does that for you! All required documentation is accessible at any time directly from the software. You can view and download what you need when you need it.

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Construction of a modern building and skyscraperWhether you’re a small- or mid-size construction company, offering an HRA to your workers can definitely be a win-win. The flexibility of HRA plans will help you manage costs, hire and keep top workers while simplifying your administrative processes. Ready to learn more? Let us know here.

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