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BrexitLatest NewsJob creation and lossesLabour marketPay & benefits

Private health perks outstrip pay rises as HR tackles recruitment problems

by Adam McCulloch 20 Oct 2021
by Adam McCulloch 20 Oct 2021 Photo: Shutterstock
Photo: Shutterstock

Employee benefits such as private health insurance have overtaken pay rises as the number one incentive being used by employers to attract recruits.

Research by jobs board Indeed Flex found that flexible working hours and improved pensions were also among benefits being dangled before candidates as 45% of HR directors grapple with labour shortages.

The study reported that one in seven HR directors (14%) were experiencing challenges filling vacancies at all levels, including senior and managerial positions. Only 18% of HR directors say they have no recruitment challenges, or do not foresee any problems arising in the near future.

Forty seven per cent of those surveyed say they have increased staff salaries “faster than usual” in an effort to attract interest from jobseekers. But 50% said they were focusing on non-financial perks including employee benefits and flexible working hours to woo potential recruits.

Private medical insurance, the most commonly offered non-financial perk, was being used by nearly a quarter (23%) of HR directors to attract workers, while more than a fifth (22%) were using flexible working hours as an incentive.

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Duvet days (holiday days in addition to normal leave), creche/childcare arrangements, sign-on incentives and private dental insurance were each being offered by 19% of HR directors.

So widespread is the perks race that only 6% of HR directors say they have not, and are not planning to, introduce any non-financial perks to entice new staff.

Indeed Flex’s report also revealed that pay inflation was not limited to full-time workers either, as almost half (47%) of HR directors who employed temporary staff had increased wages for their temp workforce too. Among firms that have increased temporary workers’ pay, wage levels have risen by 5.15% on average.

While 43% of HR directors have increased pay by between 5-6%, a fifth (20%) have hiked wages by 7-8%, the research suggested.

Novo Constare, COO and co-founder of Indeed Flex (formerly Syft) said the labour crisis was seeping into sectors beyond lorry drivers and farm workers. He said: “HR directors are now waging the war for talent on multiple fronts. The staffing crisis which first dogged the hospitality and logistics sectors is spreading to the wider economy, forcing ever more employers to fight ever harder to attract recruits.

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He added it was striking how many employers are now thinking beyond the paypacket and offering non-financial perks and incentives. A higher reliance on temporary staff was also visible. He said: “We’re seeing a surge in the number of companies opting to build the bulk of their growth on a flexible, temporary staffing strategy. Meanwhile for many workers, choosing temporary work over a permanent job gives them the flexibility and freedom they crave.”

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Adam McCulloch

Adam McCulloch first worked for Personnel Today magazine in the early 1990s as a sub editor. He rejoined Personnel Today as a writer in 2017, covering all aspects of HR but with a special interest in diversity, social mobility and industrial relations. He has ventured beyond the HR realm to work as a freelance writer and production editor in sectors including travel (The Guardian), aviation (Flight International), agriculture (Farmers' Weekly), music (Jazzwise), theatre (The Stage) and social work (Community Care). He is also the author of KentWalksNearLondon. Adam first became interested in industrial relations after witnessing an exchange between Arthur Scargill and National Coal Board chairman Ian McGregor in 1984, while working as a temp in facilities at the NCB, carrying extra chairs into a conference room!

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