How employee benefits can make a difference to recruitment challenges

The competition for talent remains a very real headwind for employers. While the labour market continues to evolve, many UK business are still facing candidate shortages, skills gaps and rising expectations around workplace wellbeing and support.

Why are employee benefits so important in a challenging recruitment market?

In this environment, it may be tempting to reduce or adjust the employee benefits packages you currently have in place. Our warning to employers is to avoid making short-term spending decisions that could undermine resilience, retention and productivity further down the line.

Recent labour market and skills reports[1]continue to highlight the pressure on employers to attract, retain and develop the right people. At the same time, sickness absence, mental health challenges and financial wellbeing concerns remain significant issues for many businesses[2]. In that context, employee benefit programmes are often at their most valuable when times are tough and when employers have limited financial options available to support their people.

How can benefits support employee wellbeing, retention and productivity?

A competitive employee benefits package should encompass protection arrangements, delivering financial security, access to private medical care and practical support features to support better health, improved wellbeing and a faster return to work where absence occurs.

EXPLORE EMPLOYEE BENEFITS ADVICE

Our Wellbeing, Health and Protection team are working with clients to ensure that their benefits strategies are purposeful, relevant and aligned with today’s workforce challenges. That means helping businesses build resilience, support employee wellbeing and make the most of the value-added services already available through their arrangements.

Now, more than ever, employers need to retain their best employees while attracting the new talent they need for the future. They also need to do everything they can to keep their workforce healthy, engaged and productive.

What should employers review in their benefits package now?

Organisations of all sizes should revisit their employee benefits package to ensure that their offering is robust, inclusive and clearly linked to business objectives. This includes checking that cover and support are easy to access, that financial, physical and mental wellbeing needs are being considered, and that any value-added tools are clearly communicated and regularly promoted to employees.

Contact our team to find out how you can support your people – and your business – through these challenging times.

[1] Skills England annual skills report 2026 – GOV.UK

[2] Reward survey: Focus on employee benefits | CIPD