Wednesday, December 31, 2014

Last day of the year, are you better off than last year?

Workers in the UK are living hand to mouth despite feeling financially better off

While many of us in Canada and the United States are not feeling we are better off than last year, even though the politicians and newspapers tell us we are better off than a year ago. Who do you believe?

More than one in three people in employment (39%) worry whether their salary will stretch to the end of the month.

The research, by Capita Employee Benefits,  was conducted in February 2014 among 3,000 people in employment through Research Now, it went on to reveal that nearly half of UK workers (45%) would not have £1000 spare to pay an unexpected bill, while nearly a third (31%) with mortgages say if interest rates go up they won't be able to afford repayments*. In fact, the research shows that simply staying on top of day-to-day living costs (33%) is the nation's top financial priority.

These findings come despite workers feeling better off financially than they did a year ago. Of the 3,000 employees surveyed, 27% say they feel better off now than they did 12 months ago, compared to 2013 when just 20% said they felt better off than they did in 2012.** 

Alex Tullett, head of benefits strategy for Capita Employee Benefits, commented: "Although people are saying they feel marginally better off than they did 12 months ago, many are still living hand to mouth, worried about how they'll make their wages stretch.

"Interestingly, employees feel their employers could be doing more to help them understand how to make the most of their finances. More than two thirds (69%) agree employers should do more to educate their workforce about different financial products and one in six (16%) say they would find financial education courses a valuable employee benefit."

The findings highlight how employee benefits packages could be a way for employers to give staff a financial helping hand. The majority of respondents (81%) are actively looking for ways to save money and say that the option to buy technology products at wholesale prices (31%), subsidised gym membership (28%) and retail vouchers (34%) are benefits they would find personally valuable.

Alex continued: "Employees are clearly looking for ways to make savings and employers can help by reviewing the benefits packages on offer. The report highlights a disconnection between benefits people want and what they get.  Take retail vouchers for example, more than a third would find these valuable but less than one in 10 employees (9%) say this is a benefit that's currently offered to them.

"Benefits packages help an employer engender engagement and improve retention - our research backs this up with 71% of workers saying they'd stay with an employer if they offered a good benefits package. As some organisations still can't afford to offer a pay rise, reviewing and providing benefits that take some of the financial burden off employees is a way of offering financial help while helping retain talent."

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