Employee benefits: is your firm keeping pace?

A group of builders, architects, and surveyors standing on a building site consult a paper plan

The growth of mental health and wellbeing within the construction industry has been well publicised over recent months. Here we consider some employee-related challenges for firms operating in the construction sector, and explain how your employee benefits strategy needs to evolve to ensure your business is in the best place for the decade ahead.


Howden is a market-leading employee benefits consultancy, focused on industry sector-specific employee benefit consulting. More than ever before we are seeing the construction industry face a number of unique challenges. Trends such as new regulation, the lack of new talent, ageing workforces and digital disruption are demanding businesses to consider how they are shaping their HR, wellbeing, compensation and benefits strategies for now and the future. 

As 2019 draws to a close, it is important not to renew your existing employee benefit plan without considering the current climate and the risks this could present. The next decade will demand change. The extent to which specific industry sectors are affected will differ, but for the construction industry, we expect to see some considerable challenges. 


Digital and technical transformation

The construction industry is experiencing rapid advancements in technology and digital transformation. It’s important for stakeholders to be aware of innovation and emerging technology to stay ahead of the game. For example, modern technology and processes such as Building Information Modelling (BIM), The Internet of Things (IoT) and large scale data analytics are driving cost efficiencies, improving project management and supporting profitability. 

What does this mean for your recruitment, retention and engagement strategies? 

Digital evolution is fast. Industry leaders can only stay ahead and capitalise on these developments when they are investing in and retaining technically astute talent who specialise in digital innovation within construction.  

How is your employee reward strategy going to evolve to match this need?  

Whereas most traditional employee benefits packages provide industry-standard benefits such as Pension (which is non-negotiable due to government legislation), Life Assurance, Income Protection, and Private Medical Insurance, the profile you are looking to attract and retain will likely value alternative packages. The good news is that these tend to come at a lower cost!

Our wellbeing and data analytics team, Psyon, use a wealth of national and socio-economic data, as well as quantitative and qualitative research to gain valuable insights into the demands and needs of varying employee demographics. Here are some of our findings for employees in the construction sector:

Choice is important

Your package should give flexibility and choice to your employees by offering a variety of benefit options, from lifestyle to wellbeing and protection.

Go digital 

There are many innovative digital alternatives to traditional health benefits. App-based GP services and digital health screens are low cost and extremely attractive to this demographic. Cash Plans have been modernised in a way that makes them far easier to use and thus more engaging and valuable. Many mental health and wellbeing apps have been gamified and are proving to engage the younger, tech-minded demographic.


Shrinking talent pool

The industry has struggled to attract new talent which is heavily impacting project resources and the ability to meet delivery deadlines. As a result, we have seen many well-documented cases of cost creep in the sector, with the most high profile case being HS2. 

Building a skilled workforce takes time and will require the government and employers to work collaboratively to reach a solution. The younger generations are being targeted with apprenticeship programs and initiatives that encourage young BAME (black, Asian and ethnic minorities) and females to consider a career in the industry.  

So how will your reward and benefits strategy need to evolve to support retaining your current demographic alongside a younger, more diverse workforce?

  • Offer a flexible benefits package with a variety of options.
  • Your benefits and reward communications strategy should be adaptable. Consider a multichannel approach using a mix of mediums, taking into account differing abilities and adapting your message accordingly. 
  • Ensure your message is personal and easy to understand. Employee benefits technology enables you to segment groups and send automated, personalised messages. Many will now support different language requirements.


Ageing workforce

In October 2018, the CIPD (The Professional body for Human Resources and People Development) released their 2018 reward management survey, which focused on the provision of employee benefits within the UK. Nearly 570 HR professionals from a variety of sectors and employment sizes responded to the survey on behalf of their employers. As part of this, professionals were asked if they expected the ageing population to have an impact on their people management policies and processes in the next five years. Just over half (52%) of respondents predicted that it would. 

Employers will need to support and encourage positive health and lifestyle management to ensure that the prevalence of comorbidity, absenteeism, presenteeism, and premium increases associated with preventable health risks in an ageing workforce are proactively and effectively managed. 

How will your reward and benefits strategies need to adapt to support an ageing population?

The good news is that the employee benefit market is already responding to the challenges of the ageing population. Common insurances such as Life Assurance, Income Protection and Private Medical Insurance already include a range of additional wellbeing services that are equipped for tackling these trends, often at no additional cost. The biggest issue we see today is that many companies are simply not benefiting from them because they are not aware of their existence.


Poor mental health 

Much has been written recently about the prevalence of mental health problems amongst employees in the construction sector. One area that can play a significant role in improving employee wellbeing is through a defined employee reward and benefits strategy. 

This is an important factor to consider when aiming to attract a younger generation. Research suggests that Gen Z, above many other factors, value a rewarding and meaningful culture when choosing their workplace. They have taken a holistic view of health and are concerned by physical fitness, healthy eating and mental well-being and are therefore enticed by health related benefits such as wellness programs. 

So, there is a lot to consider! Where do you start?
Make it personal

Understand the demographics of your current workforce and those you are trying to attract in the future. What are the benefits, wellbeing and engagement demands of these demographics? They may differ from one group to another. Having a good understanding of the employee benefits market and how providers and new benefit innovators are addressing your challenges will help you to attract the right people. 

Consider how your current benefits are utilised and how they will support the needs of these demographics. Working collaboratively with an employee benefits consultant and broker who have a good understanding of the considerations and strategies that are unique to your business will allow you to gather all of the data and insight you have to create a detailed picture of your current strategy. 

Whilst it’s important to revise your existing benefits we often see our clients trying to shoe-horn their employees into a model that is unable to deliver what they want or need. Focusing too much on the details of your standing (and often most expensive) package can distract you from more appropriate solutions. 

Timing is key! 

Don’t leave everything until renewals. To achieve a well-crafted strategy you need sufficient time to consider, buy and implement your benefits. We have seen many businesses abandoning their plans as renewal decision pressures build and they run out of time. 

Take a long term approach

The right solution may demand investment in the short term. In many cases, we are able to offset any additional spend with cost reductions elsewhere. However, where there is a need to invest it is important to project the costs forward 5-10 years. The right strategy will compensate for short term investment against a medium-term cost neutral or cost saving position, and that’s just the benefit-cost savings! Not to mention the additional financial benefits of attracting new talent, retaining valued experience, and culminating engaged, happy employees that will drive your business forward to a healthy future.


Cheryl Brennan, Director of Corporate Consulting, Employee Benefits & Wellbeing

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