Its unique survey, which is now in its third edition, included specific research among companies employing fewer than 100 staff who do not offer benefits.
Findings reveal more than three out of four are considering offering benefits to staff in the future. It is estimated that it would be equivalent to around 245,000 companies potentially investing in benefits for their employees over the next three years.
The study reveals that around 323,000 SMEs – around a quarter of the UK’s employers – currently do not offer benefits in addition to their legal requirement to provide workplace pensions.
Reflecting the challenging operating environment many firms face, around a fifth of the firms surveyed said they had previously offered benefits in the past two years but withdrew them. Over half said they have never offered any additional benefits to staff.
The key reasons cited for introducing benefits were boosting productivity and improving employees’ health and wellness. Around 66 per cent of companies considering offering benefits said increased productivity was a driver while 64 per cent said enhancing wellness was a motivation. Around 63 per cent said benefits would help with recruitment while 61 per cent believe benefits would help with the retention of key staff.
MetLife is urging employers to harness the power of employee benefits to help tackle rising uncertainty among staff, including a focus on financial wellness programmes in the workplace to support employees whose financial concerns have increased considerably over the last two years. Nearly four out of ten employees say they are living from payday to payday compared with 24 per cent in 2015.
Tom Gaynor, Employee Benefits Director at MetLife UK, said: “SMEs are under considerable financial pressure and it is understandable that many have either not taken the step of investing in benefits for the first time, or in fact stopped offering all but the compulsory auto-enrolled pension.
“However, this calls into question the effectiveness of the intermediary market as a valued source of strategic business advice to SMEs. Benefits should be seen as a performance driver worth investing in, not as a cost without payback. Our survey is encouraging as it shows the potential that is out there. The industry’s challenge is to help SMEs take the right steps.”
The survey found that more than half of SMEs that don’t offer benefits are planning on increasing their workforces over the next three years with just 6 per cent expecting they will have to cut jobs.