UK businesses now operate in 128 countries across 234,000 separate operations - and 84% of those businesses are SMEs. Yet according to the Reward and Employee Benefits Association, half of all multinationals do not have a competitive employee benefits package in place. The gap is becoming harder to ignore as smaller firms push into new markets without the cross-border benefits infrastructure to compete for the talent they need.
The findings come from joint Emerging Multinationals research published by Howden Employee Benefits and data firm Beauhurst, which challenges the assumption that international expansion is the preserve of large corporations.
The UK's tech sector is driving much of that growth. More than 3,000 companies in the digital and technology sector have operations abroad, including 565 specialist AI businesses, and there are 24,700 UK companies fewer than five years old with multinational operations. Europe remains the primary destination, with UK companies accounting for 84,800 operations across the continent. Asia and the Pacific are growing in prominence, with more than 17,000 and nearly 9,000 UK businesses present in each region respectively.
The gap is widening as SMEs compete directly with larger firms for the same international talent. Insurers now provide utilisation data, absence management outcomes and productivity impact insights to help employers justify benefits spend, according to industry analysis published in January 2026, and SMEs are increasingly turning to brokers and insurers for packaged health and wellbeing programmes to match what larger competitors can offer.
Mark Ramsook, managing director of Global Employee Benefits Services at Howden Employee Benefits, said the gap creates serious risk for fast-growing firms competing for talent across borders.
"To win the international talent war, emerging multinationals need enterprise-grade benefit structures built for lean teams," Ramsook said. "Many are scaling without a cross-border partner to bridge that gap."
Ramsook said benefit design, financing models and benchmarking are necessary components for UK firms operating overseas, allowing technology and AI businesses to offer compliant and competitive packages to small and distributed teams. He also pointed to challenges facing inbound firms - converting benefits expectations such as US-style 401(k) plans and healthcare into UK equivalents, including private medical insurance, auto-enrolment pensions and life assurance, is a common friction point.
"As the line between local start-ups and global enterprises blurs, a compliant, localised and competitive benefits proposition is no longer optional," Ramsook said. "It is increasingly what separates businesses that scale internationally from those that stall."
