5 Things The Employee Benefits World Taught Us This Week – July 17th
Here on DAM’s employee benefits blog, we take each Friday to review what’s gone on in the employee benefits world the previous week, looking at the five main employee benefit stories from the five previous days.
1. Good News: 70% Of Eligible Workers Are Now Saving Into A Workplace Pension
Workplace pension participation has rocketed to its highest level in a decade with young people and those in lower paid jobs among the biggest winners. New figures have revealed that overall, 70% of eligible employees -13.9 million people - paid into a workplace pension in 2014, a 15 percentage point increase in just two years. Young people in the private sector in particular have enjoyed a remarkable boost to their future retirement prospects, with more than half now saving. Fifty-four per cent of 22 to 29-year-olds made regular contributions in 2014 – more than double 2012’s figure of 24 per cent. Auto-enrolment has completely changed the face of pension saving. Instead of individuals having to fill out forms to join a pension scheme, they are now enrolled automatically by their employer provided they are at least 22 years old and under state pension age, and earn more than £10,000 a year. If they don’t want to belong they now have to actively opt out.
2. Is The Labour Market Really Bouncing Back?
With UK unemployment falling and recruitment firms incomes rising, are we seeing the revival of the employment market? Or is it a mirage? A recent report by the Recruitment and Employment Confederation (REC) and KPMG has said that the reality is somewhere in the middle. We are currently seeing the slowest rise is permanent placements for over two years, and a plateau in the growth for temporary billings. Tom Hadley, REC Director of Policy, said we are currently seeing a shift in the type of work candidates are seeking: “Historically, employers would have turned to temporary staff to cover absence of their permanent workforce – but recently we’ve seen a shift. “Businesses say they now take on temporary workers in order to acquire ‘key strategic skills’, and at the same time we’re seeing more people choose to go into temporary work because there are more opportunities available. “The result is that candidates for temporary roles, as well as candidates for permanent roles, are in very high demand and skills shortages making it harder for employers and recruiters to find the people they need.”
3. The UK’s Youngest Manager: Director Of Fun
Some kids take their first step into the labour force with a paper round. But one lucky child in Manchester has a chance to snatch the best first job, ever. Rochdale Exchange Shopping Centre is on the lookout for a Director of Fun. The role is to be filled by a young boy or girl between the ages of six and 10. The successful applicant will receive £100 worth of toys and be invited to officially open events and judge competitions. The Director of Fun will in addition be provided with a hat, cape, baton and a special badge to wear at the events. Lorenzo O’Reilly is the Manager at Rochdale Shopping Centre. He told Manchester Evening News: “We have a long tradition of hosting family events at the shopping centre and we thought it would be fun to get a local child involved, to help us make the 2015 events even better. “We’re looking forward to seeing all the entries and finding out what makes our young shoppers laugh.”
4. Productivity Gap: Myth or Reality?
The fact that the UK is facing a productivity puzzle is no secret – but could at least part of the answer lie in how we measure productivity? An increasing body of research suggests we might be getting it wrong, and that the way we think about and measure productivity relates to an older economy, rather than our new, far more knowledge-based one. Perhaps we need more nuanced measures of productivity than number of hours worked or total employees in relation to GDP. Paul Kearns, chair of The Maturity Institute, believes the current debate on productivity is “incomplete and immature”. “It has so far excluded any measure of the value of human capital,” he says. “And management has failed to account for the value of people in the productivity equation. We need to resolve these issues if we are to get closer to solving the puzzle.” He adds: “Unless [we all] work to agreed definitions and start asking difficult, mature questions about human capital and human productivity then the current debate on productivity is unlikely to be resolved to everybody’s benefit.”
5. Are Unclear Emails Harming Productivity?
During the Budget George Osborne, Chancellor of the Exchequer announced that Britain had left 'the age of irresponsibility' behind. In his speech, Osborne tackled one of the main issues facing UK businesses today, namely, the productivity problem. A recent study by EF Education First has revealed that productivity is hampered by unclear emails, which in turn has a negative effect on turnover. The study of over 800 directors and managers working for international organisations indicated that the primary cause for conflict stems from language barriers (39%). Peter Burman, President of EF Education First, explains why executives need to stop over relying on email in order to prolong productivity. “Internal communication in the digital age is subject to a number of challenges that can lead to miscommunication – and none is more troublesome than email. “Technology means that virtual teams have become the norm in global companies, but the lack of human interaction means that employees can feel disengaged from the rest of their team. For productivity and performance to be realised this needs to change. “HR teams have a fundamental role to play in ensuring the right culture and mix of tools are deployed to allow effective working and email has a part within that. The challenge is not over relying on email as it is the most common source for miscommunication. “Removing it totally, however, means businesses would lose an effective channel to challenge each other’s thinking. That sort of conflict is good for firms and is vital for effective decision making.”