Employers are focusing more on employee benefits as a way to support staff and manage ongoing recruitment and retention challenges, according to a new study.
A survey of 300 UK HR decision-makers found that nearly half believed offering a good range of benefits should be the top priority for organisations. It ranked ahead of salary, workplace culture and work-life balance.
The findings suggest HR teams are reassessing what matters most to employees in a post-pandemic labour market still shaped by cost pressures and heightened employee expectations.
Benefits ranked higher than pay
The study, commissioned by HR software provider Ciphr, found that 46% of respondents saw employee benefits as the most important issue for employers to focus on. This compared with 45% who prioritised creating a positive and healthy workplace culture and the same proportion who ranked work-life balance as critical.
Only 42% said paying a good or fair average wage was the most important priority, putting pay below several non-monetary forms of support.
Other top concerns included training and career progression (42%), treating everyone fairly (41%), and job security (40%). Mental health and wellbeing support was a focus for 39% of those surveyed, and 38% said building meaningful in-person connections among staff should be a priority.
Karen Lough, director of people at Ciphr, said the results reflected how organisations were reassessing their employee value proposition in light of financial pressures and changing workforce expectations. She said: “This research offers a timely snapshot of the priorities shaping HR agendas across the UK.
“With financial pressures mounting, it’s no surprise that many organisations are re-evaluating their employee value proposition (EVP) and placing a greater priority on good benefits as a core part of their recruitment, retention, and recognition strategies.”
She added that benefits often provide more flexibility than salaries and allow employers to remain responsive to employee needs while controlling costs.
Flexible and personalised benefits gaining favour
Phil Curtis, managing director of Avantus Employee Benefits, said job seekers had become more selective about what they expect from employers since the pandemic.
“Experience tells us that job seekers have become progressively more discerning, especially since the pandemic,” he said.
“They look beyond the headline salary when weighing up employment opportunities, and they want to feel fairly rewarded for the value they bring to an organisation. Personalised benefits are an essential part of that.
“Employers who embrace flexible benefits – giving people greater autonomy to choose the benefits they genuinely want – have seen staff retention rates improve.”
Remote working no longer a top priority
Although hybrid and remote working remain important to many staff, the study suggests they are now seen as less urgent priorities than other aspects of work culture. Only 27% of HR leaders identified remote or hybrid working as a top concern, compared with 38% who emphasised the need to build meaningful in-person connections.
Other areas that ranked lower on the list included ensuring workloads are manageable (36%), diversity and inclusion (35%) and providing occupational sick pay (21%).
Only 19% of those surveyed prioritised encouraging a right to disconnect outside usual working hours, and 25% cited closing gender pay gaps.
Recruitment, retention and AI among 2026’s biggest challenges
The survey also asked HR leaders about their biggest challenges for the year ahead. Recruiting enough qualified workers, retaining existing staff, and managing rising operational costs all featured prominently.
Meeting expectations around hybrid working and finding effective ways to integrate artificial intelligence (AI) into HR processes were also cited as growing concerns.
The findings come amid continued pressure on HR teams to do more with less, as businesses look to optimise spending while still offering an attractive employment package in a competitive market.
The survey was carried out by polling service OnePoll on behalf of Ciphr between 22 and 28 July 2025 and involved HR decision-makers at medium and large UK businesses.
