According to a new report, Benefits that build – Exploring the impact of employee benefits on startup growth from Howden Employee Benefits, nearly three-quarters (73%) of UK startups plan to revamp their employee benefit programmes in the coming years. This shift reflects a growing recognition that employee benefits are essential tools for the recruitment and retention of talent and for business growth.
The research, commissioned by Howden, surveyed decision-makers in over 100 UK startups. It reveals almost half (46%) of these leaders view employee benefits as essential for recruitment and their sustained business success. In the competitive landscape of startups, where almost a third face challenges in recruiting and retaining talent, the quality of employee benefits is emerging as a key differentiator.
Highlights of the report:
47% of startups plan to expand or introduce Private Medical Insurance (PMI) and mental health support: Whilst the NHS remains the cornerstone of our healthcare system many startups are focusing on PMI to ensure employees have prompt access to healthcare services, given the current constraints and NHS waiting times.
42% aim to enhance their workplace pensions: Recognising the importance of long-term financial security and delivering better retirement outcomes for employees, many startups are looking to improve their pension offerings as a key benefit.
35% intend to offer gym memberships or lifestyle discounts: With an increasing focus on health and wellbeing, startups are providing lifestyle benefits such as gym memberships and lifestyle discounts.
34% are considering adding Group Life Assurance: To provide additional financial security to employees and their families, a significant number of startups are exploring the introduction of Group Life Assurance. A cost-effective benefit, it offers peace of mind by ensuring support in the event of an unexpected loss.
The top three benefits currently provided by startups are workplace pensions (80%), PMI (41%), and mental health support (38%).
Richard Gould, Director of Small Business Solutions at Howden Employee Benefits, commented:
“In 2023, the UK had 5.6 million registered businesses, with 99.9% classified as SMEs. Startups are an increasingly important element of this, with 801,006 new businesses created between 2022 and 2023[i], a 6.4% rise from the previous year.
"Howden is the ultimate startup success story. In 1994, three friends founded an insurance brokerage with a People First approach. Today, we’ve grown into a global business but have stayed true to our founding principles.” "Our own employee benefit offerings have been key to helping Howden attract and retain top talent and, as our survey highlights, UK startups also view benefits as essential for their recruitment strategies and businesses success.
The research was conducted by YouGov amongst benefits decision-makers working in startup SMEs (defined as those in operation between 2-5 years with fewer than 250 employees) between 29 May – 12 June 2024.
To download the report, please go to: https://eb.howdengroup.co.uk/howden-employee-benefit-trends-in-startup
For more information, please visit www.howdengroup.co.uk