UK employers could be spending up to £15 billion a year on employee benefits that do not resonate with their staff, according to research by Isio and YouGov.
The organisations, which surveyed more than 7,000 private sector employees, found that 23% felt their current benefits package meets all their needs, with satisfaction highest among older, married white homeowners. Satisfaction levels dropped to 16% and 15% respectively for Asian and Black respondents.
Those that felt their benefits met their needs were 62% less likely to have made cutbacks to their spending on shopping essentials and utility bills over the first half of 2023 than less satisfied colleagues, while 45% were less likely to move jobs. However, those who thought their benefits package met none or very few of their requirements were 60% more likely to quit.
One-quarter (26%) were likely to move jobs in the next 12 months, with ethnic minorities more likely to switch. Nearly half (42%) of Black employees said they were planning to move in the next year, versus 34% of Asian and 23% of white staff.
The research also found that employer-provided financial education, such as help with pensions (82%), helping individuals know their rights (73%), saving (61%) and tax planning (56%) were in demand. Ethnic minorities were more likely to welcome financial education, with pensions education requested by 86% of Asian and 87% of Black respondents.
Benefits relating to flexible working were the most impactful for staff retention, with 70% with hybrid working and 65% with flexible working stating this would persuade them to stay in their role. Half (50%) said that pension contributions would have an impact and 45% said help to buy a home would help.
Will Aitken, director at Isio Reward and Benefits, said: “There is an opportunity now for employers to reshape benefits packages so that they resonate not just with their current workforce but future employees. It’s encouraging to see financial education high on the agenda for all demographics and also to see the demand for benefits which directly tackle the cost-of-living challenges so many people currently face. If employers can target benefits more specifically on the things that their employees actually want, they have an opportunity to improve inclusivity, remove wastage and benefit from greater talent retention.”