August 8 2006 – A mere one in four of job advertisements refers to employee benefits and only 16 per cent feature membership of a pension scheme as part of the employment package, according to recent research by Watson Wyatt.

Watson Wyatt sampled 1000 national, regional and local recruitment advertisements in the first week of July 2006. Only advertisements with at least 50 words about individual jobs were included. 70 per cent gave some details about salary but just 25 per cent refered to other benefits such as pensions, health insurance and bonuses.

“Employee benefits can make up as much as 40 per cent of an employee’s total remuneration package, so those employers with a good range of benefits may be missing out on a useful recruitment tool,” said Gary Smith, a senior consultant at Watson Wyatt. “Employees traditionally undervalue the benefits – and in particular the pension benefits – provided to them by their employer. Perhaps some employers are guilty of encouraging this by not highlighting the benefits they offer at the earliest possible stage in their relationship with potential recruits.”

A survey from Axa Investment Managers released in July 2006 found that 67 per cent of employees thought that full details of the employment package should be compulsory in job advertisements. 42 per cent of senior managers in the survey agreed.

In Watson Wyatt’s survey, of the 16 per cent of job ads that made some reference to pensions, 34 per cent pointed to a final salary scheme while 9 per cent said they had a defined contribution scheme. Intriguingly, pensions were more likely to be mentioned in advertisements for lower paid jobs. Ads for jobs with higher pay (over £30,000) tended to refer to pensions only when they could offer a final salary scheme.

Apart from pensions, specific employee benefits were rarely mentioned. These were:

  • Holiday entitlement (9%)
  • Bonus scheme (8%)
  • Car or car allowance (6%)
  • Flexible working arrangements (4%)
  • Healthcare benefits (3%)
  • Equity or share options (2%)
  • Life assurance (1%)

“The quality of employer communication about the benefits on offer can be at least as important as the structure and cost of providing them in affecting employees’ perceptions of their value,” said Gary Smith. “HR professionals and recruiters might consider how they could do more to leverage competitive advantage out of their employee benefits schemes.”