06 Jun 2019

5 ideas to help make employees' pay packets go further

The May 2019 release of the ONS’ average weekly earnings reveals that for January to March 2019, average weekly earnings increased by 3.3 per cent - the latest increase in a trend of fast growth for UK wages. When wage growth has sat below inflation for a number of years, the last few months have eased the squeeze on pay.

A big driver for this wage growth is undoubtedly the National Living Wage. April 2019 saw the biggest National Living Wage increase so far, at almost 5 per cent, giving full-time workers a £690 annual pay increase. However, maintaining pace with these increases puts pressure on employers to keep finding the funds, which means there could be less available for other pay elements like bonuses.

Getting the money in the pocket right is also crucial for attracting and retaining talent. And in today’s world of (almost) full employment, it becomes harder for businesses to hang on to people. To keep employees engaged and feeling valued, employers must look for ways to make pay go further. Let’s take a look at five ideas that could help your investment make the biggest difference to staff:

1. Savings and loans
Perhaps the most effective way to make pay go further. Saving schemes could allow employees to save towards a rental or mortgage deposit, pay off student loans, or top up pension pots. Loans could help ease commuting costs with travel season tickets or cycle to work schemes.

2. Financial education
Tools to help employees better manage their money can also help. The Money Advice Service provides some great tools for employees such as a budget planner, and ways to save money on things like household bills. Employee assistance programmes also commonly offer help for financial concerns, like debt advice or financial planning.

3. Health benefits
Looking after health can be expensive. Health and dental plans that focus on preventative health offer a cost-effective and accessible way for employers to support employee health and wellbeing. And employees are enabled to get money back towards their healthcare such as visits to the dentist or optician, or physiotherapy treatments.

4. Access to discounts
Many employee benefit providers offer discounts, helping employees earn cashback on their regular spending, or giving exclusive retail discount offers. You could also seek out local businesses such as gyms, restaurants, and garages to negotiate discounts for your staff, helping to support local businesses too.

5. Supporting financial worries at work
Financial wellbeing is a key part of any wellbeing strategy. Worries over finances can mean that employees aren’t focused on or engaged with their work, and productivity will be affected. Research shows that a quarter of workers report that money worries have affected their ability to do their job¹.

We have created a step-by-step guide to help businesses design a financial wellbeing strategy that will enable employees to get back in control of their finances, and focus at work again.

This article is provided by Simplyhealth.

Reference

1. CIPD/Close Brothers Employee Financial Well-being research report 2017