29th June 2023
What do employees want from their benefits?
Author: Michael Tigwell, Chief Operating Officer, Benefex
Much had changed since we conducted our last employee research study in 2022. The world has thankfully moved on from the worst of the pandemic but, in many ways the levels of uncertainty and anxiety that people are feeling in their day-to-day lives has only increased.
Rising energy prices and soaring costs of living are placing more and more employees under financial strain. Political and social unrest is being felt in almost every corner of the world, and digitisation and technological innovation are leading to seismic shifts in human behaviour. And all of this is having a profound impact on every aspect of wellbeing.
At the same time, workers are giving greater consideration to what they want from work, what they expect from their employer and, bigger picture, how their job aligns with their own personal values and purpose.
The 2023 Benefex Evolution Report explores the evolving relationship between global employers and employees – and how reward and benefits are adapting to changing employee needs. This year, to explore both sides of the relationship, we’ve created two white papers: The Employee Edit and The Employer Edit.
The first part, The Employee Edit, is informed by more than 2,000 interviews with employees across four countries, and explores how employee prioritise are evolving against a backdrop of uncertainty, the most important features of an excellent employee experience, and what makes employees want to join an organisation – or leave it.
Benefits have become more important to employees
The report found that the biggest shift in attitudes was in relation to employee benefits, where employees are taking a much greater interest in their employer’s offering – becoming more focused on benefits as a way to get help with their financial wellbeing and protect them against the impact of illness and injury.
As a result of this increased focus on benefits, employee expectations around benefits provision are increasing.
91% of employees believe that the benefits that an employer offers can directly impact their wellbeing, and 88% say employee benefits show whether an employer aligns with their personal values. However, only a third (35%) of employees feel that their employer’s benefits are very closely aligned with what is important to them. Older workers, aged 40 and above, are more likely than younger workers to believe that their benefits package matches their personal needs and values.
Our research highlights major differences between countries in sentiment towards benefits provision. In the U.S. and India, employees are far more positive about the benefits they receive than those in the UK and Singapore. In the UK, only 13% of employees report that their employer’s benefits provision is very closely aligned to what is important to them, compared with 59% in the U.S.
Employees have firm ideas about how employers could and should be improving benefits provision – by offering more relevant and personalised benefits, focusing on benefits which directly support wellbeing, and those that align with their own personal values.
What employees want from their benefits
It’s not surprising that we’ve seen a shift in employee preferences away from choice towards relevance within benefits. In the current environment, people don’t care about how many benefits they have access to if they’re of no interest or value to them; they just want to be able to pick specific benefits that support their needs, their lifestyle and their wellbeing. This is why there is now such demand for core, protection-focused benefits.
Employers can provide a wealth of different benefits but if they don’t resonate with their audience, then they’re simply wasting their time and money. During the pandemic there was an almost kneejerk reaction amongst some employers to provide a huge range of benefits to employees, particularly in relation to mental health and wellbeing to ensure that newly remote employees were supported. And this means we’ve now got some very bloated schemes offering a proliferation of benefits which aren’t necessarily designed or well thought through.
Relevance is the #1 priority
Employers need to get back to focusing on relevance within benefits, thinking carefully about what different groups within their workforce really need and value. This involves purposeful design, regularly engaging with the employee population to understand what they view as important. Employers need to move beyond stereotypes around what people value based on their demographics and take a more nuanced approach to develop a benefits scheme which is relevant and valuable to all.
Ultimately, HR and Reward professionals should be considering the purpose of each benefit that they include within their scheme. Who is it for and what value is it bringing those people?
Technology has a big role to play here, enabling employers to gather data and insights into take up of specific benefits and to drill down into how different groups of people within their workforce are engaging with benefits. This can help to rationalise benefits schemes and keep them targeted and relevant.
To learn more about employees’ ever-evolving expectations and see the top ten benefits most valued by employees globally, read Benefex’s Evolution Report: The Employee Edit.