There is a benefits mismatch between what GCC employees want from their employers and the perks their companies offer, a recent survey from global recruiter Hays found.
More than half of working professionals surveyed said child education allowances and flexible working are the two most important benefits. However, only 13 per cent of employers offer both perks as part of a standard employment package, according to the Hays Salary & Employment Report 2020 for the GCC market.
The two most common benefits provided by employers are a company car or car allowance and life insurance, despite employees ranking these eighth and seventh respectively when considering a new role, according to the survey of 6,800 people.
“We are seeing more and more misalignments between employer offerings and employee requirements,” says Chris Greaves, managing director of Hays in the Gulf region. “While employers must be realistic — they cannot afford to offer every available benefit to employees — we recommend they review their benefits packages on a regular basis.”
Benefits are an important pull for top talent, especially when hiring managers are not able to offer a higher salary, say recruitment agencies.
"When candidates are reviewing a job offer, the salary will continue to be a large factor. However, when professionals are receiving more than one job offer, they will consider the complete remuneration package on offer, including benefits and working environment," says Gareth El Mettouri, associate director of Robert Half UAE.
In-demand candidates in the Middle East will require "double-digit salary increases" to switch jobs this year, according to the 2020 Middle East Salary & Skills Guide from recruitment consultancy Michael Page.
At the same time, Hays found that 54 per cent of salaries remained the same year-on-year in 2019, 41 per cent increased and 5 per cent decreased. Mr Greaves says Hays anticipates salaries will remain “largely the same year-on-year in 2020” with pay increases going to those with proven experience and niche technical skills.
For those who started a new job last year, the top reasons to move to a new organisation were career development for 31 per cent of those polled, followed by a salary increase for 16 per cent, redundancy for 14 per cent and benefits for 11 per cent.
Misaligned benefits
When considering a new role, employees chose a child's education allowance as the most important benefit, followed by flexible working, share incentives and financial support for professional studies.
In comparison, in the 2019 report, employees ranked flexible working first and an education allowance second. However, life insurance slipped from third last year to seventh this year and company car/car allowance from fourth last year to eighth this year.
“As the world of work evolves, people’s needs change and if employers are not receptive to this, they could risk losing some of their top performers,” Mr Greaves says.
More than half of employers (54 per cent) offer a car allowance or a company car and about half include life insurance as part of a standard employment package.
Only about a third of employers offer flexible working and a similar percentage offer an education allowance.
Flexible working
Varun Khosla, head of executive compensation at Mercer Middle East, says there is an increasing demand for flexible working practices, such as “flexi-hours” and working from home.
“Working hours are no more eight hours a day. Most people are working 10 to 12 hours … in between they may need to pick up kids at school, be at home to fix a leak,” he says. “Companies are becoming more flexible about those flexi-hours because you only get the weekend and there is only so much you can do at the weekend.”
Robert Half's 2020 Salary Guide found that 19 per cent of businesses think they don't offer enough unique perks and benefits to compete.
"Flexible working is rising in popularity. With nearly every candidate we meet, they are either requesting this during the interview process or have come to expect it within the remuneration package," says Mr El Mettouri.
Half of respondents in the Hays survey say their work-life balance is “very good” or “good”, but 32 per cent rated it as “average”, 12 per cent as “poor” and 6 per cent as “very poor”.
About a quarter of employees said flexible working would help improve their work-life balance, followed by better working hours, office environment and commuting time.
Education allowances
Ian Giulianotti, executive director of recruitment and executive search at Nadia Global, says employees are asking for education allowances as the cost of housing decreases, particularly in the UAE.
“The two biggest expenses that people have here are housing and education,” Mr Giulianotti says. “Housing costs are going down, so they can’t ask the companies for more housing allowance, so now they’re pushing for education allowances.”
Housing and transport allowances are often included in salary packages, mainly to reduce the employer’s exposure to end-of-service gratuity, which is calculated based on base salary, Mr Giulianotti says.
However, education allowances come at a big cost to companies, who are also moving away from the traditional expatriate packages of the past.
“Today we’re not expatriates in the true sense … in that we come here for a short time and our cost of living is covered,” Mr Giulianotti says. “The majority of the workforce are coming here on a longer term basis than in previous decades.”
Employee retention
In addition to salary and benefits, career development is a key way to retain employees. The Hays report found 55 per cent of employees to be dissatisfied with the career development opportunities provided by their employers.
“The one thing we can say to employers is that if you are not providing employees with relevant benefits and not developing them either, then you are guaranteed to lose many of your employees to other organisations who do,” Mr Greaves says.
