Cover magazine 28th January 2018
Flexible and voluntary benefits offer most effective solution for closing employment benefit gap within small-to-medium enterprises, MetLife UK research finds.
Sixty percent of employee benefit consultants (EBCs) believe better SME take-up of employee benefits is the biggest challenge for the industry over the next two years, with flexible and voluntary benefits offering most potential for growth.
Small businesses account for 99.3% of all private sector companies – they employ 15.7m people and make up 60% of all private sector employment – with a combined annual turnover of £1.8tn in the UK.
While a lack of HR and poor communication are holding many SMEs back, they represent a huge amount of potential for the employee benefit market.
According to MetLife UK research, 60% of ECBs cite flexible benefit provision as the main area of demand growth, with over two fifths (41%) believing voluntary benefits will help grow the market through SMEs.
EBCs (39%) also believe better communication of benefits within SMEs is needed, while a third (33%) of them recognise the older generation as another source of demand.
Meanwhile, 21% mentioned employee assistance programmes.
“Smaller employers are increasingly aware of the need to attract and retain a skilled, motivated workforce, especially where they may not be able to compete with larger businesses on pay or business profile,” said Adrian Matthews, employee benefits director for MetLife UK.”
“Well tailored benefits that are well communicated can make a significant difference to SME staff retention and employees will welcome support in improving physical health and wellness as well as financial wellness in the workplace.”
According to Matthews, the technology sector is seeing very quick business growth, with start-ups going from two to 200 employees during the space of months rather than years.
These companies are going “from a ‘no benefits’ environment to needing to provide benefits in a short period,” he said.