Around 73 per cent of UK start-ups are planning to revamp their employee benefit programmes, with 47 per cent prioritising Private Medical Insurance (PMI) and mental health support to offset NHS delays, according to Howden Employee Benefits.
According to the new report, ‘Benefits that build – Exploring the impact of employee benefits on startup growth’, the shift reflects a growing recognition that employee benefits are essential tools for the recruitment and retention of talent and business growth.
YouGov conducted the research by surveying decision-makers from over 100 UK startups that were 2-5 years old and had fewer than 250 employees.
High-quality benefits are becoming a key competitive edge with the research finding that nearly half or 46 per cent of companies see employee benefits as crucial for recruitment and long-term success but nearly a third are currently struggling to attract and retain talent.
According to research, 42 per cent intend to strengthen workplace pensions for better retirement outcomes, while 35 per cent intend to provide gym memberships or lifestyle discounts to promote employee wellbeing.
Meanwhile, around 34 per cent are contemplating Group Life Assurance for increased financial stability.
Currently, the most popular benefits offered by startups are workplace pensions at 80 per cent, PMI at 41 per cent, and mental health support at 38 per cent.
Howden Employee Benefits director of small business solutions Richard Gould says: “In 2023, the UK had 5.6 million registered businesses, with 99.9 per cent classified as SMEs. Startups are an increasingly important element of this, with 801,006 new businesses created between 2022 and 2023, a 6.4 per cent 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.”
