Employers plan benefits strategy changes in 2014

Nearly one in six (59%) respondents plan to change their benefits strategy in 2014, according to research by Edenred.

Its Benefits insight: trends for benefits in 2014 research, which surveyed almost 100 HR and reward professionals, found that 69% plan to increase the number of benefits they offer in 2014.

Nearly three-quarters (72%) of respondents said benefits budgets would be static, while only 7% have been asked to cut back on benefits.

Almost half (49%) said pensions auto-enrolment was the biggest driver of change in their benefits strategy, while 43% cited the cost of living.

However, 43% of respondents see pensions auto-enrolment as a platform to increase employee awareness of the wider benefits mix.

The research found that only 14% of respondents ranked the use of mobile platforms for benefits as one of their three priorities for the year ahead, while 23% thought mobile channels represented a good opportunity to drive an increased take up of benefits.

The research also found:

  • 21% of respondents intend to invest more in benefits in 2014 than last year.
  • 49% of respondents said a reduction in benefits investment would harm their ability to retain and attract the talent they need.
  • 74% of respondents see benefits as a tool that supports employee engagement in their organisations.
  • 39% of respondents said benefits delivered a good return on investment, while 29% said these help to achieve business objectives.

Andy Philpott, sales and marketing director at Edenred, said: “Our research clearly shows that employers are gearing themselves to do more to help employees with the rising cost of living in the year ahead.

“With reward budgets remaining largely static (just 21% of organisations will invest more in benefits than last year and salary budgets look set to remain below the level of inflation) the trend of achieving more for less with benefits spend remains a key challenge for employers.

“The good news is organisations are seizing this as an opportunity to be more creative with their reward proposition, with many employers planning to increase the number of benefits on offer in 2014.

“With limited levels of additional investment, it is clear that benefits delivered through salary sacrifice [arrangements] and voluntary benefits schemes will play a bigger role in delivering the choice and support employees need.”