And finally…Scottish workers would prefer extra holidays to a bonus
As many Scottish employees return to work after the first of two Spring bank holidays, new research from PwC has revealed that, if offered, most Scottish workers would prefer to take five days extra holiday than receive a one-off bonus of £500.
And despite reports of household incomes still being under pressure, almost a quarter of Scottish and UK employees would also choose to invest in long-term savings plans such as their pension rather than take the £500 cash windfall.
According to the survey, only 17 per cent opted to take a discretionary bonus award as extra pay, revealing a preference among employees for tax efficient savings. When it comes to variable pay it appears that most workers are balancing short-term consumption with longer term financial planning.
The survey of more than 2,400 employees, including around 2oo people in Scotland, also revealed that 35 per cent of employees would prefer to purchase extra annual leave over any other new workplace benefit, with this rising to 47 per cent among employees under the age of 20.
As well as varying by age, the desire to buy extra holiday also varies by sector. When asked if they would prefer extra holiday or a £500 discretionary cash bonus, two-thirds of individuals in professional services opted for extra holiday, while 58 per cent of retail workers chose extra pay.
The importance of receiving cash over benefits increases, however, when employees are offered the opportunity to exchange 5 per cent of their pay for a new workplace benefit.
In this scenario two thirds of employees surveyed say that they would wish to maintain their cash rather than sacrifice 5 per cent of their existing salary for any additional benefits.
With pensions and savings plans proving the most popular among respondents overall, the survey suggests that people do recognise the need to save for the long-term. However, few would give up a portion of their existing salary for any other benefit, suggesting that they have little room for manoeuvre within their existing reward packages.
Gwyneth Scholefield, human resource services director at PwC in Scotland, said: “With people still feeling the squeeze, despite record low inflation, it’s clear that they value benefits that will save them money. One of the most popular options chosen by Scottish and UK workers are long-term savings vehicles such as pensions suggesting that people recognise the need to save for the long-term rather than spend their earnings on immediate consumption.
“What is interesting is that employees are more likely to sacrifice discretionary pay such as a bonus for additional benefits and that funding additional holiday from work ranks as one of the most popular ways of using such a windfall
“There are also commercial benefits in creating more flexible employee reward programmes. By better understanding their people and the diversity of their workforce, businesses could design a reward programme that takes account of individual preference - a move that could bring significant cost savings and stop employers wasting valuable cash on benefits that are simply not valued by everyone.”