As businesses face a challenging economic landscape and evolving workforce demands, employee benefits are set to play a central role in maintaining organisational success. Industry experts stress the need for strategies that address both employee needs and business outcomes.
Towergate Employee Benefits highlights the importance of comprehensive support that extends to all employees, irrespective of seniority.
"Employee benefits have traditionally been viewed by some, as the perks of the most senior members of staff. Far from this, an effective employee benefits strategy for 2025 should encompass not only employees of all levels within the organisation but also the business itself, and those businesses that do this will be the winners this coming year,” explained Debra Clark, head of wellbeing at Towergate.
She warns that companies failing to adopt inclusive benefits strategies risk missing out on significant advantages.
According to Towergate, employee needs continue to shift. Many workers are now part of the "sandwich generation", managing responsibilities for both children and elderly parents.
Census data reveals that over 2.5 million employed individuals in the UK also serve as carers, underscoring the importance of workplace support. Meanwhile, National Health Service pressures persist, with over 1.6 million patients waiting more than a month for General Practitioner appointments. Employers providing health and wellbeing support are more likely to retain productive, engaged staff.
Meanwhile, mental health remains a leading area of focus for employee benefits, according to research by Towergate. Other priorities include financial health, general health screening, and specific needs such as fitness, fertility, and neurodiversity.
“Offering the right support to employees means that the company ultimately benefits too: in terms of enhanced recruitment, retention, engagement, productivity, and loyalty, and from lower absence rates, but only when the right support is put in place. It will be a missed opportunity in 2025 if employers don’t get this right,” said Clark.
Alongside these challenges, GRiD warns that rising employer costs, including National Insurance tax increases and higher minimum wages effective in April 2025, will place benefits under greater scrutiny.
GRiD spokesperson Katharine Moxham noted that employers must demonstrate the value of their benefits packages by tracking utilisation rates and showing business impact.
“Where benefits are shown to be effective they will be retained. However, many companies will be looking to make savings to account for the increased costs of employing staff. As a result, benefits will be at risk if there is not sufficient evidence to support their continuation,” said Moxham.
Group risk benefits—such as life assurance, income protection, and critical illness cover—are expected to gain traction, offering financial protection and embedded services to support physical, mental, and financial health.
Moxham advised HR teams to gather data now to make the case for retaining these benefits amid cost pressures.
"They need to show not only uptake of benefits, but also the positive impact on the business itself. However, this also represents a great opportunity for the HR department to demonstrate its accountability and commerciality,” Moxham added.
Do you think businesses are prepared to balance employee wellbeing with financial sustainability? Share your perspective in the comments below.
