Rethinking Rewards: 58% Of Employees Would Prefer Bigger Pensions Over Other Benefits

The 2025 Drewberry Workplace Pensions Survey has made one thing crystal clear: UK employees are prioritising long-term financial security over short-term perks. More than ever, retirement savings are taking centre stage, so if you’re still investing in benefits that your employees don’t really value, you could be missing a vital chance to engage your workforce.

This trend sends a powerful message to employers. If you’re still investing in headline-grabbing benefits that sound good on paper but don’t support long-term financial wellbeing, it may be time to reassess. Employees are speaking up, and what they want is security in retirement.

Beyond the Bare Minimum

While it’s encouraging that 89% of UK workers are enrolled in a Workplace Pension scheme, confidence in those pensions is noticeably low. 68% of employees don’t believe their current pension will be enough to fund a comfortable retirement, and that concern is fuelling demand for more generous employer contributions.

Employees Want More Than The Minimum

The statutory minimum employer contribution in the UK is just 3%. That may meet legal obligations, but it falls short of employee expectations. According to our data, 61% of employees want their employer to contribute more than the minimum, with nearly a third saying this is “very important” to them.

Yet, despite this desire, almost half of employees don’t know how much their employer is currently contributing to their pension. That signals not just a shortfall in contributions for many workers – but a lack of visibility and communication around what’s already being provided.

Bigger Pensions Are The New Priority

58% of employees told us they’d rather receive higher pension contributions in place of other company benefits. Another 25% said they’d consider that trade-off, depending on the perks in question. In contrast, just 10% preferred additional benefits over enhanced pension savings.

• Yes (58%)
• It depends on the benefits (25%)
• No (10%).

While a well-planned benefits package can certainly add value – enhanced pension contributions should be part of that process.

Matching Contributions Motivate Employees to Save More

Encouragingly, it’s not just about what employers put in. Employees are willing to do more if the right incentives are in place. When asked whether they’d increase their own pension contributions if their employer matched them, nearly half (48%) said yes, with a further 40% saying they would if they could afford to.

This points to a clear opportunity for employers to introduce or promote matching schemes. Not only do they help employees build better retirement pots, but they also create a sense of shared responsibility and partnership in financial planning.

It’s worth investing in perks that bring work-life balance and long-term security, as money worries was listed as a top stressor according to our 2025 Employee Benefits And Workplace Satisfaction Survey, with 80% of employees admitting that stress negatively impacts their work performance. The survey also found that bigger pension contributions are the third most sought-after benefit for employees this year, showing that long-term financial security is firmly on people’s minds.

Don’t forget that your contributions as an employer count as an allowable business expense. These are deducted from profits before your corporation tax assessment.

This makes it a tax-efficient way of using your profits as you’ll get tax relief.

Richard Noble
Senior Consultant, Employee Benefits

Pensions Are No Longer A Perk – They’re A Dealbreaker

Enhanced pension contributions are no longer just a “nice-to-have”, but are becoming a deciding factor for employees considering a new role. When asked ‘When looking for a new job, how important is it that a potential employer offers a good pension?’ 84% of workers said it was important. In a market where retention is critical and recruitment costs are rising, that’s a statistic no employer can afford to ignore.

• Fairly Important (44%)
• Very Important (40%)
• Not Very Important (8%).

Pensions are now a competitive advantage, and businesses that go above the statutory minimum and actively promote their pension offering are more likely to attract and retain top talent. And when employees feel like their long-term future is being supported, loyalty follows.