Despite soaring energy bills increasing financial pressure on UK adults, half (47%) of young employees aged 18-34 years old are not expecting a pay rise this year, according to new research from employee benefits technology platform, Zest.
A lack of adequate financial support puts employers at risk of losing key talent as 64% of younger employees would consider leaving their jobs if their employer was unable to increase salaries.
The findings also reveal that over half (55%) of younger employees are not expecting a bonus from their employer this year, placing further pressure on finances.
With the recent energy price cap rise, which saw average yearly bills jump by £221 to hit almost £1,900, financial support is becoming an increasing priority
This is leading to greater demand for support with rising energy costs, with employer contributions to energy bills ranked one of the most popular benefits. Overall, two thirds (66%) of employees are calling for more financial support from their employer.
Employee benefits are a cost-effective approach to boost financial support as well as attracting and retaining talent. They are also increasingly prioritised by employees with 69% of young workers saying the current economic climate has made benefits more important to them and six in ten (59%) admitting they’d leave their job if another company offered a better benefits package.
However, currently many reward strategies require major improvement - 53% of younger employees think their benefits package is inadequate and three quarters (74%) want their employer to invest more in their benefits offering.
- Failure to effectively offer financial support to employees puts employers at risk of losing key talent as six in ten (64%) young workers aged 18-34 admit they would consider leaving their company if their employer was unable to increase salaries.
- Offering year-round financial support is key to keep employees motivated and retain key talent - 69% of young workers say the current economic climate has made benefits more important to them and six in ten (59%) admit they’d leave their job if another company offered a better benefits package.
- Reward strategies require major improvement - 53% of younger employees think their benefits package is inadequate and three quarters (74%) want their employer to invest more in their benefits offering.
This is partly down to poor employee engagement in benefits packages – just half (54%) of younger employees use the whole range of benefits offered to them. Enhancing communication to understand the support employees need is key to boosting engagement in benefits package and value for money.
Joy Waugh, Principal Consultant at Zest, says: “While UK inflation rates are beginning to fall, any pay adjustment below inflation is, in real terms, a pay cut. As pay rises continue to lag behind, amid rising living costs and energy bill spikes, employees are demanding greater financial support from their employers through their reward packages.
“Offering effective rewards to all employees, especially younger workers, is key to not only boosting morale and performance but also supports with talent attraction and retention. For employers, it’s vital that they boost employee communication and engagement to understand what support employees are calling for, deliver this seamlessly and ensure that the workforce is accessing this. Failure to do so ultimately curbs commercial performance and growth.”
Zest, partner of the Epassi group, is a benefits technology platform allowing employers to oversee the usage of their benefits packages, allowing them to adapt and streamline benefits packages to their employees’ needs.
