Employers Are Split on Benchmarking: Where Do You Fall?

When it comes to employee benefits benchmarking, UK employers are almost evenly divided. Our 2026 Employee Benefits Benchmarking Report¹ found that roughly half of businesses actively benchmark their benefits against competitors. The other half do not. Can you afford not to know how your offering compares?

Benefits Benchmarking in 2026

Effective employee benefit design rarely happens in isolation. Contribution levels, cover standards and working norms are influenced by what competitors are doing. Yet nearly half of employers are setting strategy without formally referencing that external context.

Our findings reveal a divide in how organisations approach their benefits offering. Just under half (49.5%) actively benchmark their benefits against competitors, while almost the same proportion (46.8%) do not, and 3.7% were unsure.

This raises an important question for leadership teams: how confident can you be in your benefits strategy if you don’t know where you sit in the market?

Why Benchmarking Is So Important

The impact of not benchmarking might not be obvious straight away, but over time, it quietly builds and becomes harder to ignore. Take pensions as an example. 26.2% of employers offer a 5% employer contribution, while 22.4% remain at the statutory minimum.

Neither approach is inherently right or wrong. But without benchmarking, it’s hard to know what your decision really says about your business, whether you’re in line with others in your sector, falling behind, or perhaps investing more than you need to.

Organisations that adopt a market-informed approach are better positioned to optimise spend, differentiate effectively, and respond to evolving workforce expectations. Without this insight, businesses risk falling behind, offering packages that may not fully meet employee expectations or align with what competitors are providing.

In this year’s survey, 31.5% of employers said they offer Private Health Insurance, up from 28.2% last year. While this suggests a gentle upward trend, it’s best viewed as an early indication rather than clear evidence of a broader market shift. Organisations not tracking these shifts may fall behind evolving expectations.

Financial Efficiency

Perceived value for money is generally positive, yet enthusiasm is measured. Only 26.5% of employers describe the value for money from their benefits as “very good”. This suggests a level of uncertainty.

Benchmarking helps bridge that gap, giving organisations a clearer view of:

• How competitive their contributions really are
• Where spend might not be delivering full value
• Which benefits are most valued in the wider market.

Often, modest adjustments (such as increasing Workplace Pension contributions or offering matched contributions) can significantly enhance competitiveness without disproportionate cost.

Supporting Recruitment and Retention

With 32% of employees willing to leave for better benefits, maintaining a competitive position is crucial. Benchmarking informs recruitment messaging and ensures reward packages reflect current market standards.

It also reduces the risk of reactive decision-making. Without benchmarking, changes are often reactive rather than proactive, risking:

• Falling behind competitor offerings without realising
• Overreacting to isolated feedback rather than market trends
• Making reactive changes under pressure, rather than planned improvements.

Using Benchmarking As a Strategic Advantage

Informed decisions carry less risk than assumptions. With half of employers still not benchmarking, those who do gain clearer visibility and stronger positioning. Benefits strategy benefits from data, and benchmarking supplies it.

Get Specialist Benchmarking Help

But benchmarking doesn’t need to involve complex modelling. It can include activities such as reviewing industry surveys, consulting advisers and comparing provider terms.
These activities can be time-consuming, which is where our specialists can step in.

We can help you compare your current offerings with market standards, providing tailored recommendations and competitive quotes to ensure you achieve the best value for your business. Call 02074425880 or submit an enquiry to arrange a free consultation.

More Top Stories From The Report

• Comms Not Cutting It? Rethinking Benefits Communication in 2026
• The 40% of Employers Missing Out: Why Salary Exchange Deserves a Closer Look
• Pension Governance: An Overlooked Risk for One in Five Employers
• Ditch the Spreadsheet: Why Manual Benefits Admin Is a Risk You Don’t Need

Why Speak to Us?

Employee benefits can be a headache. But our specialists do this day-in, day-out, offering first class service when you need it most. Here’s why you should talk to us:

• Award-winning independent employee benefits consultants, working with leading UK insurers and benefit providers
• Assigned specialist on hand to help – every step of the way
• 4119 and growing independent client reviews rating us at 4.92 / 5
• Authorised and regulated by the Financial Conduct Authority. Find us on the financial services register
• Claims support when you need it most.

Sources

• ¹2026 Employee Benefits Benchmarking Report: https://www.drewberryinsurance.co.uk/knowledge/2026-employee-benefits-benchmarking-report