Employers navigate benefits strategies with conflicting ambitions
UK Plc continues to find itself in tough times. With the pandemic now in the rear-view mirror, an enduring economic squeeze means that employers now face a range of challenges including rapidly rising benefits costs and strong competition for talent.
Our 2023 Benefits Trends Survey found that with a seemingly ever-increasing mental health crisis, issues around the cost of living and the continued focus on both environmental, social and governance (ESG) concerns and benefits inclusivity, steering the right course on benefit strategy is more complex and demanding than ever.
Competition for talent and rising costs are the top key issues influencing benefits strategy. Employers may want to bolster their investment in benefits to attract and retain talent, but they are also facing unprecedented cost challenges due to a weaker business environment and concerns about workforce performance.
Figure 1 highlights the dramatically different economic landscape since our last survey in 2021. Whilst employers had been forced to rapidly adapt to navigate the impact of the pandemic, today they are facing one of the most difficult markets in recent memory for attracting talent and a surge in inflation.
To win and keep talent in a competitive environment, it is essential to design benefit programs that meet the needs and preferences of a diverse employee population. When asked to identify the top three most important benefits strategy issues more than half (56%) of UK employers claimed that they aimed to meet the needs of their entire workforce. Ensuring these focuses come to fruition will help employers in the competition for talent that’s currently raging across the UK.
There are some areas of disconnect between employer priorities and employee needs. Employees want more emphasis on benefits that support their long-term financial security, career development and flexible working. Employers may recognise the need to enhance their market position in these areas but, to date, have prioritised health benefits, mental health support and inclusion and diversity more.
Creating inclusive workplaces has ramifications that go beyond the immediate acceptance that employees feel. Employers who fail to deliver on diversity, equity and inclusion (DEI) policies could see a significant exit risk among employees who prioritise these issues. UK employers are digging deeper into how diversity, equity and inclusion affects benefits.
For more insights, and recommendations for how to elevate your benefits strategy, download the full report by completing the form on your right, or below on a mobile device.
Employers in the United Kingdom are looking to rise to the challenge of attracting and retaining talent while controlling cost. Explore ways to help navigate this.
