Almost three-quarters (73%) of SMEs are experiencing higher demand in terms of what employees want from their pay and benefits package, new research by WorkLife by OpenMoney has found.
The employee benefits platform’s latest Small Business Monitor reveals the most common areas for workers to be expressing a need for greater support include increased flexible working options (32%), training and development (27%) and help for mental wellbeing, such as how to manage stress (23%).
Other popular options were payroll loans (16%), where regular payments can be taken from an employee’s salary, cycle to work schemes (14%) and green benefits (13%), such as electric vehicle purchase schemes.
Further down the list were discounts on fitness services and gym memberships (9%), followed by special rates on insurance (8%) and personal technology (8%).
With the study uncovering that almost a third (30%) of firms had been approached by their employees with concerns as to whether their current salary will cover their inflation-increased outgoings, the findings may reflect the wider climate of people needing to focus their spending on more fundamental day-to-day costs, rather than additional non-essential purchases.
More broadly, the research reveals staff salaries and benefits to be a key part of the broader recruitment challenges currently being faced by UK SMEs. Of the 28% of firms who said they were struggling to recruit at this time, more than a third (36%) cited the cost of rewarding and incentivising employees in line with their expectations as an issue, while 34% were concerned about meeting salary demands.
Just under a fifth (17%) of SMEs said an increased demand for pay and benefits to be one of the biggest challenges facing their business right now.
Steve Bee, director of WorkLife by OpenMoney, commented: “It comes as no surprise to see employee remuneration and reward on so many SMEs’ minds in the current environment. Given the clear impact that recruitment challenges are having on UK businesses as a whole, establishing the right approach is crucial. But with such a wide range of benefits and support being requested by employees, deciding where any spend will have the most meaningful impact may feel daunting, particularly for those firms under financial pressure.
“At a time when rising costs may impact companies’ ability to increase salaries, there are a number of cost-effective benefits and training and development options that can motivate existing staff and entice new joiners – while also fostering a loyalty and commitment to the company as recovery continues.”
WorkLife’s Small Business Monitor is based on research carried out by 3Gem among 759 senior financial and HR decision makers in UK SME companies with 5 – 250 employees. Fieldwork for the Spring report took place between 9-17 March 2022.
Helena Jones (MRM) – firstname.lastname@example.org / 07503 645 612
WorkLife is a digital platform on a mission to make financial advice and employee benefits accessible and affordable to every UK business.
Powered by OpenMoney, it combines top of the range financial advice and market leading benefits with low cost and transparent fees, allowing SMEs to reward their employees with the same great perks as those traditionally enjoyed by workers at larger companies. The platform puts an emphasis on employee wellbeing, making sure they are covered in all the financial, mental and physical aspects of their life.