Employers in the retail sector are cutting back on workplace benefits in a bid to offset costs ahead of next week’s minimum wage hike.
According to an analysis of job ads by recruitment platform Adzuna found that some employers are cutting back on perks by as much as 60%.
Common benefits such as flexible working, enhanced pensions, eyecare, private healthcare and dental care are all down, it found. Flexible working offers dropped by 59%, enhanced pensions by 42%, eyecare by 28%, private healthcare by 23%, and dental care by 21%.
The company analysed 72,193 job ads in the retail sector in February 2025, February 2024 and October 2024, tracking the number of job ads promoting different work perks over the past year.
Retail employers
A 6.7% increase to the national minimum wage was announced in Rachel Reeves’ first budget as chancellor in October 2024.
Retail companies are also expected to be hit hard by an increase in employers’ national insurance contributions to 15%, which also come into force from 6 April.
Adzuna found that in February 2025, the most popular retail work perk was employee discounts. There were over 16,000 job ads offering employee discounts, down by 45% year-on-year and 34% compared to five months ago.
Employee assistance programmes were the next most popular benefit (13,518 jobs), followed by gym membership (9,781 jobs).
Cycle to work schemes remained a popular benefit, but were down by 37% since the national minimum wage announcement.
Although some benefits were removed or less frequently on offer, enhanced maternity and paternity leave increased by almost a quarter (23%).
The number of retail employers offering employees a holiday on their birthday went up by 7%. Adoption leave also increased by 2%.
Andrew Hunter, co-founder of Adzuna, said it was clear retail employers were “tightening their purse strings”.
“While the sector is already grappling with labour shortages and high time-to-fill, the nuance of the UK’s slowing economy and reduced consumer spending are compounding the challenge,” he added.
“In response to rising salary costs, many retailers are scaling back on perks, yet these benefits often play a key role in attracting and retaining talent, creating a Catch-22 situation.
“To stay competitive, employers must find a balance between rising talent cost with an ongoing labour shortage or explore new ways to attract talent.”
Sign up to our weekly round-up of HR news and guidance
Receive the Personnel Today Direct e-newsletter every Wednesday
Compensation and benefits opportunities on Personnel Today
Browse more compensation and benefits jobs
