What employees really want
2006-11-01
When it comes to benefits, employees appear to have a a strong interest in holiday entitlement, perhaps a reflection of the long-hours culture in Britain. The Employee Benefits survey into What do employees really want?, conducted by research company TNS, shows that employees' favourite benefits are holidays over the statutory minimum of 20 days, final salary pension schemes, bonuses and flexible working. When asked what benefits they would like to receive in an ideal world, six weeks of paid holiday emerged as employees' most desired benefit.
However, there are marked differences in attitudes to benefits depending on people's lifestyle and occupation. These findings suggest that if organisations are to get maximum return on their investment in benefits they need to tailor their packages to suit their workforce. One size won't fit all.
Ensuring that employees enjoy the work they do, is the key to staff retention. Work enjoyment is the factor which employees cite most often when asked what keeps them with their current employer. However, earning more money is what would most attract them to another employer and the factor they say will most improve morale and motivation. Compared with job satisfaction and pay, benefits have a smaller role to play in terms of recruitment, retention and motivation.
While four-in-ten of those with an occupational pension scheme are not worried about the security of their income on retirement, most do have concerns. One-in-six say they will have to contribute more to get a decent pension, while a similar proportion say they will have to postpone retirement to get a decent pension.
What benefits do employees receive?
What are employees'favourite benefits? †
Employees' preferences for benefits in an ideal world
Benefits employees would like to have, but don't receive
What would attract employees to another employer?
What factors help to retain staff?
What increases morale and motivation?
†
| What benefits do employees receive? | |
 |
†The most commonly offered benefit is 21 or more days' holiday, (that is, above the statutory requirement of 20†days), received by 53% of all employees (see table 1). Other commonly-received benefits are a final salary pension scheme (35%), bonuses and flexible working (both 26%). Not surprisingly, those working in larger firms (where 500 or more staff are employed) are more likely to receive a wide range of benefits. For example, 66% are entitled to 21 or more days paid holiday, 49% are members of a final salary pension scheme and 26% receive free counselling. |
| What are employees'favourite benefits? | |
 |
Of all the benefits they receive, employees' favourites are final salary pension schemes, bonuses, flexible working and holidays over 20 days - all mentioned by around four-in-ten of those receiving them (see table 2). Although free counselling is now offered to 14% of all employees and a quarter of those in larger organisations, only 3% say this is their favourite benefit. These overall figures hide some interesting differences between groups. Holidays and final salary pension schemes are the top favourites among public sector and professional workers who receive these benefits. Company cars and final salary pension schemes are managers' favourite benefits, while bonuses and flexible working are the top two favourite benefits among those sales and service staff who received these benefits. And unsurprisingly, those aged over 55 years say their favourite benefit is their final salary pension scheme. |
| Employees' preferences for benefits in an ideal world | |
 |
Employees' ideal benefit would be six weeks paid leave, which was chosen by 43% of all employees. This preference, coupled with the fact that holidays are employees' favourite among benefits currently received, could be a reflection of Britain's long-hours culture. A quarter of employees chose a six month sabbatical (after five years of service) - this rose to 34% for both managers and those in professional roles, more than any other group. The third most popular choice was profit share (23%). This was higher among those in the manufacturing sector (36%), skilled manual workers and those working in sales and service sectors (both 29%). Those aged 16-24 years, more than any other group, wanted a sports car as a company car and a free in-house bar - not a good combination of benefits. |
| Benefits employees would like to have, but don't receive | |
 |
Private medical insurance (PMI) is one of the main benefits which employees would like to receive. This was particularly mentioned by those over the age of 55 years (37%); only 5% of this age group currently receive private medical insurance. A third of those in administrative roles would also like to receive private medical insurance, but only 9% currently do so. Company cars are another benefit which employees would most like to have. A quarter of those aged 16-24 years would most like to have a company car, while 3% of those in this age bracket currently get one. Managers are another group of employees who would like company cars; while 20% currently get a company car, a similar proportion of those who don't would like to have one. A quarter of public sector workers say they would like to receive a bonus; currently only 9% get one. Despite working in the public sector, a quarter say they would like private medical insurance, while just 5% currently receive it. |
| What would attract employees to another employer? | |
 |
Employees are clear that the main factor which would attract them to another employer is a higher salary. Other factors such as a more interesting job and career advancement come before better bonuses and other benefits. |
| What factors help to retain staff? | |
 |
In terms of staff retention, enjoying the work is the factor which most employees (43%) say makes them stay with their current employer. Job security is the next most important factor for retention; this is particularly true for those in the manufacturing sector (41%) and men (39%). Colleagues, the third most important factor overall, are particularly important to those in the service sector (33%). Working close to home helps to retain women (35%), public sector workers (31%), and administrative staff (33%). Benefits have a less important role to play in terms of retention compared with job enjoyment and security. |
| What increases morale and motivation? | |
 |
Employees say that increased salary, as well as increased rewards and bonuses, would also improve their morale and motivation at work. Other key factors include training and development, recognition from management and better career prospects. Public sector workers say they would like to receive bonuses, but are less likely than others to say these would improve their morale and motivation (24%, compared with 30% in the private sector). Professional staff and managers, more so than others, say that recognition by management would improve morale and motivation. Managers and those aged under 34 years are more likely than others to say that better career prospects would improve their motivation. |
| Pensions dilemma | † |
 |
Half of all employees say they belong to an occupational pension scheme. Younger people, those in the service sector and those working in skilled or semi-skilled trades are least likely to belong to such a scheme. When those who belong to an occupational pension were asked how they feel about the security of their income on retirement, some 38% say they are not worried because they belong to a good scheme. However, the majority have concerns with 21% saying they don't think their pension investments will sufficiently improve to deliver a decent pension, while 17% believe they will have to contribute more and 16% say they will have to put off retirement in order to receive a decent pension. Some 9% admit they don't understand their pension and 2% are not worried because they believe they will live on their state pension. Table 8 shows the reasons why employees do not belong to an occupational pension scheme, the most common being that their organisation does not offer such a scheme. This is despite the fact that employers with five or more employees are obliged to offer a pension scheme. This could be explained by the profile of those not belonging to a scheme (younger, working in the service sector or in a skilled trade) because employers are not obliged to offer the scheme to temporary staff, and may only offer it on joining the firm and not thereafter. While 14% have a personal pension, the other main reasons for staff not joining an occupational scheme are financial and a lack of understanding about pensions. Lethargy is a factor for a minority. |
†
- Publisher:
- Employee Benefits
- Date:
- 2006-11-01
