How personalised benefits can combat the gender pay gap

Though there is no substitute for fair and equal pay, benefits represent a tangible expression of an organisation’s commitment to wellbeing and inclusivity

The ongoing cost-of-living crisis is widening the gender pay gap, evidence suggests.

According to women’s charity Smart Works, more than two-thirds (68%) of women said they had applied for lower paid and lower skilled work than they are qualified for.

Similarly, recent research by recruitment firm Reed reveals that the average female worker now needs a 55% pay rise to live comfortably, compared with 31% for men.

As well as earning less money, women also receive fewer workplace benefits, with 65% getting company perks, compared with 75% of men.

Employers have a big role to play in ensuring this doesn’t lead to even greater financial disparity between men and women in the workplace.

Though there is no substitute for equal pay, there is a clear opportunity for employers to better support their female employees in a way that extends beyond salary, and in the meantime can lessen the load inflicted by the gender pay gap.

Women need more support with finances

During challenging economic times like these, employers need to strengthen their commitment to inclusion and equality.

Focusing on wellbeing strategies, such as paid mental health leave, increased childcare support or mindfulness programme can foster a sense of belonging and support among employees and prompt beneficial change.

When approaching a benefits strategy, it is critical to communicate with employees to understand how to best support them.

While this will differ from person to person, according to Zest’s most recent research*, on average, nearly six in 10 women (57%) want more financial support from employers – higher than the average of 54% for men.

A similar number (58%) of women say the cost-of-living crisis has changed their outlook on what is important in a job, and the same number (58%) say that company benefits have become more important to them when deciding where to work.

The most desired benefits for female employees include private medical insurance (41% of women named this as one of their top 5 most sought-after benefits, compared with 36% of men), increased pension contributions (31%), and – as prices spiral – employer contributions to home energy costs (28%).

There are also differences in the benefits that different genders look for from an employer.

For example, a company car is the fourth most important benefit for male employees’ priorities (21%), whereas for women this was less of a priority ranking eighth (15%).

More popular options for women include a wellbeing allowance (28%) and discounts at high street shops and brands (23%).

While financial support is vital, wellbeing support is equally as important. For example, Creditspring’s financial stability tracker 2023 report found that a quarter of people in the UK believe their mental health has never been worse because of money worries.

And with women having more money concerns due to the gender pay gap, this may help explain why 22% of women want paid mental health leave, compared with 14% of men, prompting employers to pay close attention to their wellbeing initiatives.

Benefits are crucial for talent retention

While better benefits will primarily improve an employee’s life, getting this right is critical for employers, too – 42% of women say that a good benefits package is the single most important thing they look for in a potential employer, and more than half (52%) would simply leave their job if another company offered them better benefits.

Flexible and personalised benefits that can be quickly administered and easily accessed can drive better experiences for women in the workplace, mitigate the worst effects of the cost-of-living crisis and even lessen the strain perpetuated by the gender pay gap.

Though no initiative will ever be a substitute for fair and equal pay, benefits represent a tangible expression of an organisation’s commitment to the wellbeing and inclusivity.

Failing to get this right not only threatens to increase gender disparity in the workplace, but puts businesses at risk of draining half of their talent pool.

*Findings were conducted by independent research agency Opinium which surveyed 2,000 adults weighted to be nationally representative between 1 and 5 December 2023.