13 Oct 2016

Why employers need to ‘Mind The Gap’ when planning benefits campaigns

By the mid-1960s it had become increasingly apparent to London Underground bosses that the practice of having drivers and station attendants warn passengers to take care when boarding trains was, to say the least, somewhat outmoded and largely ineffectual. The number of passengers and the amount of sheer noise on cavernous curved platforms meant an alternative means of communication was needed.

The solution chosen was to deliver an automated announcement through a digital recording using solid state equipment. This led to the next obvious conundrum: what should the announcement actually be? In certain respects the answer was driven by the technology of the day and another practical consideration.

As data storage capacity at the time was expensive, the phrase had to be short. Furthermore a concise warning was also far easier to paint onto the platform. Necessity remains the mother of invention. And so, in 1969, a simple three-word caution entered the lexicon and, indeed, has since become synonymous with London for millions of tourists; spawning a mini-industry of mugs, t-shirts and fridge magnets.

The phrase is, of course, “Mind the gap”.

Not only is this a story of how communications do not need to be lengthy or technical to convey a key message, it is in many respects a very good summary of the strongest overall message arising from this year’s Employee Insight Report that we have recently produced.

The gaps to be minded manifest in three key areas: a generation gap, an education gap and a communication gap.

Inter-generational unfairness

The deep recession from which we are slowly recovering has sparked many debates. The fate of the ‘millennials’ and, by implication, the legacy of the baby boomers has possibly been one of the most divisive.

Those speaking from, or on behalf of the younger generations have argued that those who benefitted from free further education, generous pensions and an accessible housing market have, in effect, pulled the ladder up behind them. Or to use a phrase familiar to baby boomers, “I’m alright, Jack.”

Baby boomers would cite the greater freedoms and choices available to the younger generations and their delivery of a liberalised and more egalitarian society than the one in which they grew up.

Whatever the rights and wrongs of the debate, what is clear is that those who have entered the workplace over the last decade have faced significant challenges: suppressed wages, more limited job opportunities and a high cost of living, especially in the form of rent.

Our research shows that employees under the age of 35 have the most optimistic financial outlook. However, while they are more likely than any other cohort to believe that tomorrow will be a better day, the costs of today are manifestly a financial challenge for many younger employees.

30.8% of 25-34 year olds struggle each month compared to just 11.1% of over 55 year olds. Some 37.4% of under 35s worry that they will not be able to get through the month without going into debt. Indeed 48.0% of employees earning less than £25,000 say they simply could not meet an unexpected bill of £1,000 and 28.9% of employees aged 25-34 say that financial worries impact on their productivity at work.

Any benefits strategy in place needs to be sympathetic to this predicament that a significant section of its audience is facing.

Financial literacy: the known unknown

It is very apparent again this year that many employees are confident about one thing in terms of their financial acumen: that it is sadly inadequate.

Employees are acutely aware that they do not understand many aspects of the financial world from the cost of borrowing to the art of saving, many are ill-prepared for the markets they have to navigate through and the choices that they now have to make.

Self-education is reliant on what might be considered questionable sources. Google was back at the top this year as the primary source of financial information with 35.7% of respondents confirming it as their resource of choice or perhaps more accurately their port in the storm.

While the internet has been a transformative tool for us all, it is worrying that so many are relying on information that may be out of date, inaccurate or misleading, in some cases deliberately so.

It is therefore perhaps unsurprising given this conscious lack of knowledge that so many employees are looking for their employers to fill the education gap. 60.3% of employees felt that their employers should provide them with access to financial education to help with their retirement planning.

But this should not be taken as being driven by older employees. The call for education was high across the spectrum of age, gender and salary level with the highest demand (62.1%) coming from female employees and those under the age of 35.

And yet only 5.2% of respondents said their employer makes financial education available to them. This is, in many ways, the most striking disparity between what employees say they want and what they are actually getting. This education gap is now surely a call to action.

“What we've got here is failure to communicate”

Around the same time as the great and good of the London Underground were contemplating their communications challenge, one of the seminal films of the 1960s was hitting the cinemas: Cool Hand Luke. A very cool Paul Newman stars in the title role as Luke, a prisoner in a Florida prison camp who refuses to submit to the system.

In one of the film’s most famous scenes, the captain of the prison in fury and exasperation decries “What we've got here is failure to communicate. Some men you just can't reach.” Indeed, it is a line repeated back to the captain by Luke at the film’s climax. Suffice to say that the two parties never do find an effective communication channel.

While the employer/employee relationship is a little less dramatic than this, the communication challenge is certainly common to both. In preceding Employee Insight Reports we have shown the disparity between employees’ preferred method of communications and the engagement strategies used by their employers.

This year we have delved deeper to not only look at the headlines but to really examine the extent to which employees feel engaged by the media used to convey key benefits messages.

In particular for every individual respondent we examined the channels of communications they were seeking and those their employer were using to assess whether there was a perfect match, a close fit or indeed a total absence of overlap.

For the under 25s, only 17.6% saw their employer’s choice of communication channels as closely fitting their preferences. For 44.1% it would have to be described as a total failure. While the results narrowed with age, for those aged 45-54, only 25.5% would describe the communications as a close fit with 36.8% still in the total failure camp.

There’s no doubt that the wide variety of channels now available make it very difficult to please everybody but this does go to show that while focusing on content and message is very important, the media being used needs to be constantly evaluated to ensure engagement programmes remain current and effective. Failure to do so could undermine the exercise entirely.

Building the perfect beast

The modern workforce is diverse, complex and at times, if not contradictory, then certainly paradoxical. So the challenge of attracting, retaining and maximising the contribution of talented individuals is no mean task.

It is clear that a number of younger employees need support through testing financial times, that many employees are keen to see their employers support their educational needs and that communications programmes need to be flexible and dynamic and should use multiple channels to convey their important messages.

We do hope that this year’s report will provide fresh evidence and insights for HR and benefits professionals, will help them to ‘Mind the Gap’ and will support the ongoing development of truly 21st century benefits strategies.

Download the full Employee Insight Report.

This article was provided by Capita Employee Benefits.