More than four in 10 employers in the region (41%) spend over 20% of payroll on benefits provision, according to Towers Watson’s 2015 Asia Pacific Benefit Trends Survey.
The report noted that when determining which benefits to offer, employers take into account costs, both implementation (72%) and ongoing (69%), to a great extent.
Surprisingly, few (22%) take their employees’ views into account to a great extent when determining which benefits to offer. Instead, more than double that number (43%) consider market benchmarking/competitor strategy.
While knowing what the competition is doing is clearly of interest, making sure that benefits meet employee needs is likely to ensure much more targeted use of the spend invested in benefits, according to the report.
Benefits not highly valued by their employees
Indeed, the survey found that only 16% of employers across Asia feel that the benefits they offer are highly valued by their employees (Figure 1).
But when considering the perceived value by benefit spend, while there is some increase in those companies who say benefits are highly valued at the higher levels of benefits spend, the increase is certainly not proportionate – there is an 8 percentage-point jump in companies who say benefits are highly valued (from 15% to 23% as spend increase), however, the increase in spend itself is on average at least 20% of payroll more.
Employee insights should be taken into account
What does seem to have a noticeable impact on perceived value is whether employee insights are taken into account when determining which benefits to offer, said the report (Figure 2).
The number that said that their benefits were highly valued jumped three times for companies that do take into account employee insights compared to those that do not.
The survey found a similar impact on perceived value when considering whether the organisation effectively handles lifestyle events for employees (eg when employees get married, have children, etc). The number that said that their benefits were highly valued almost doubled for companies that effectively handle lifestyle events compared to those that do not.
“It’s clear that employers can wield their growing spend on benefits more effectively than they are currently doing. The way forward could be to make employees feel like a valuable stakeholder in their own benefits, by providing more thoughtful benefits that are flexible and relevant across a diverse workforce,” said Mr Chris Mayes, Director, Benefits Optimisation, Asia Pacific for Towers Watson.