How to incorporate macro trends into your total reward strategy
For years, the increasingly ageing population of the UK has made newspaper headlines. An increasing life expectancy and decreasing birth rate are converging; the Office for National Statistics projects that there will be an additional 7.5 million people aged 65 and over in 50 years’ time.
This will invariably have ramifications on employees and employers alike. If employees are unable to afford retirement, there could be a consequential impact on succession planning and new talent attraction. An ageing population may also cause a greater need for working carers, and create additional pressure for those who may already be juggling parental responsibilities with work.
Employers can help mitigate these risks by putting financial wellbeing at the heart of their approach to employee wellbeing, and ensure there’s enough support for employees in their retirement planning. The approach also needs to extend beyond compensation; for example, flexible working may be the appropriate solution to best support employees balancing multiple care responsibilities.
Over the past 20 years we’ve witnessed and experienced the boom of the digital revolution. Not only has this changed how we interact with each other and the world around us, it has also redefined our expectations for this experience. When you can order products and have them arrive at your doorstep within 24 hours, it suddenly feels prehistoric having to wait a year to update your employee benefits options or understand how your pension is performing.
Progressive digital platforms (think TikTok, Netflix or Spotify) aren’t just disrupting experiences, they’re also disrupting customer expectations. Employers need to understand this shift in baseline expectations – especially for younger generations who are digital natives – and ensure they build a total reward experience that feels modern rather than antiquated. Consumers expect more from the brands they engage with, and total reward is no different.
Equity and inclusion
Social injustice is at the forefront of our cultural consciousness; the Black Lives Matter movement and the gender pay gap are two examples which highlight how macro-inequality impacts both employees and employers.
Employees expect diverse and inclusive organisations; according to our 2021 Benefits and Trends Survey, 70% of employees expect a better approach to diversity and inclusion. Total reward strategies need to be inclusive. This doesn’t always translate to treating everyone equally; reward strategies need to be tailored to the workforce you have, in a considered, inclusive way. For some, the most valuable benefit might be support with debt management. For others, it may be childcare support.
It’s important that employers don’t assume what their workforce wants, but conducts employee research that digs into the heart of the issues. Demographic data only tells half the story; it’s up to employers to uncover the rest.
Developing a future-proof strategy
By nature, trends flux and evolve. But that doesn’t mean employers should only be reactive. By considering these macro-trends, companies can develop a proactive approach to total reward, one which can weather uncertainty and provide better support for employees. And, as our Future of Total Reward guide shows, the results for the employer can be vast – more engagement, greater productivity and reduced turnover. Using the data of today can help create the total reward of tomorrow.
The author is Jeff Fox, head of benefits strategy at Aon.
This article is provided by Aon.
In partnership with Aon
Let's talk benefits!