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Employee benefits can help SMEs retain top talent

Group of four employees working together in a small office

Job satisfaction is high among UK employees but large numbers are still thinking about leaving their current role, according to new research.

The findings from health insurer Westfield Health highlight a key challenge for businesses in 2023 as workers face the reality of higher mortgage rates and increased energy bills.

More than three-quarters of employees (76%) said they were either satisfied or very satisfied with their job, yet nearly half (46%) are considering changing jobs.

In a separate survey by the Office for National Statistics, 20% of people said they are dealing with the cost-of-living crisis by looking for a job that pays more -- the highest of any solution.

If salaries don't keep up with inflation and employee benefits don't provide enough support, the risk for employers is that their top talent will leave in search of better compensation elsewhere.

Small and medium-sized businesses (SMEs) that are already dealing with soaring running costs will be hit particularly hard by further costs to replace lost workers.

"The average cost of hiring someone new is around £3,000," explained Dave Capper, chief executive of Westfield Health.

"Coupled with the cost-of-living crisis, struggling with retention of workers could have a big impact on businesses, especially if the UK heads into a recession. SME leaders are facing huge financial challenges as it is; pair this with further unexpected recruitment bills and there's a real cause for concern."

Employee benefits such as financial advice, health and wellbeing initiatives and Employee Assistance Programmes (EAPs) are one area that SMEs can focus on to attract new employees and retain others who might be thinking about moving elsewhere.

"Those working for bigger organisations tend to note salary and career progression as key benefits -- both of which help toward talent retention. They are also more likely to have wellbeing benefits; however, a key part of keeping employees happy is looking at the overall context these perks are provided in -- the culture of an organisation," Capper explained.

"Our research shows that those working at SMEs enjoy the fact that their company has a better workplace culture and a more tight-knit community within the business, something which is much harder for large companies to change and get right.

"There's a David and Goliath battle for talent on the horizon where smaller businesses have a real opportunity to play to their strengths and use these qualities to attract and retain talent.

"For SMEs looking to attract top talent away from large businesses, prioritising company culture and bridging the benefits gap with small investments in key areas, like mental health support, could be the key to recovering and thriving in the post-Covid economy."

Posted by Fidelius on January 3rd 2023

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