Are your benefits helping you stand out – or holding you back?

How to benchmark your benefits – and win

In today’s competitive job market – where employment levels remain high and employee expectations are evolving – it has never been more important for employers to review the strength of their benefits package.

In today’s candidate-driven market, skilled professionals often have their pick of opportunities. Businesses that fail to offer relevant, attractive benefits risk being overlooked – not just by potential recruits, but also by their current workforce.

While salary continues to play a key role, it’s the broader package – encompassing health and wellbeing support, financial security and non-monetary benefits such as flexibility, work-life balance, workplace culture, career development opportunities and the overall employee experience – that increasingly shapes decisions to join or remain with an employer.

But how can you tell if your benefits stack up against the competition? And how do you identify what needs improving or what already gives you a competitive edge?

The answer lies in benchmarking. By comparing your benefits against those of similar organisations, industries, sectors or peer group employers, you gain valuable insight into how your offer measures up and where there’s room to evolve.

Here we outline five steps to help you benchmark with confidence and take a more strategic, data-driven approach to employee benefits.

Step 1: Take stock of what you offer

The first step in any benchmarking exercise is getting a clear picture of where you are today. This means going beyond a checklist of what you offer and thinking about the purpose behind each benefit, how well it aligns with your business values, and whether it genuinely supports your employees.

From core provisions such as pensions and paid leave to enhanced offerings such as private medical cover, income protection, wellbeing initiatives or flexible working, a full audit of what’s available is essential.

This should include formal schemes as well as informal perks – the kinds of cultural or policy-driven benefits that contribute to employee experience but aren’t always documented.

Equally important is understanding how these benefits are perceived. Are they used? Are they valued? Are there elements that employees are unaware of, or don’t understand?

Gathering feedback through surveys, focus groups, employee resource groups or even informal conversations can offer a clearer view of how benefits are landing across your workforce and where expectations may be shifting. This is particularly important in a diverse workforce, where different groups may have very different needs.

Step 2: Look beyond your four walls

Once you understand your internal position, it’s time to see how you compare. This is the core of benchmarking – placing your organisation’s offer in the context of the wider market.

At Towergate, we support employers with access to anonymised benchmarking data from more than 15,000 UK businesses. This allows organisations to see how their benefits package compares to others in their industry or region – not just in terms of what’s offered, but how those offerings are evolving over time.

Understanding where you sit in the market isn’t just about keeping pace. It can help you identify areas where you may be falling behind and highlight where you’re ahead of the curve. This knowledge can inform both internal investment and external messaging, turning your strengths into recruitment and retention tools.

Benchmarking also reveals which trends are gaining traction, helping you respond to emerging employee expectations.

Step 3: Focus on what makes a difference 

Benchmarking isn’t about replicating what your competitors are doing, it’s about making the right decisions for your people and your business. A more-is-better approach can quickly lead to bloated, underused benefit packages. Instead, focus on the benefits that drive real outcomes. 

A growing number of employers are shifting their focus from simply offering ‘more’ benefits to ensuring those benefits deliver real impact – whether that’s in reducing absenteeism, improving mental wellbeing or boosting employee engagement.

For example, if employees aren’t engaging with an existing financial wellbeing programme, it may be more effective to improve how it’s communicated or accessed, rather than introducing a new benefit.

It is also important to tailor your strategy to your workforce.

While some employees might be looking for more support around mental health and flexibility, others may prioritise enhanced parental leave or better pension contributions. Benchmarking helps you understand common practice, but internal insight should shape how you act on it.

Step 4: Turn insight into action 

With a clearer picture of your position, both internally and externally, you’re in a strong place to make strategic changes. The goal here isn’t necessarily to spend more, but to invest more wisely. 

For some businesses, the data might point to a gap in a particular benefit area, such as dental cover or access to virtual GPs. For others, it may highlight inconsistencies in how existing benefits are promoted or accessed.

In many cases, the most effective changes come from refining and refocusing, rather than expanding.

Better communication around your benefits can have a significant impact on engagement and perceived value. Ensuring flexible working policies are applied consistently, for example, may do more to improve employee satisfaction than introducing a brand-new scheme.

Benchmarking equips you with the evidence you need to prioritise, helping you close gaps, reinforce strengths and ensure your benefits package is both cost-effective and valued.

Step 5: Keep benchmarking alive 

The world of employee benefits doesn’t stand still and neither should your approach.  

Economic trends, different inter-generational expectations and business priorities are all shifting constantly. What felt competitive two years ago may no longer meet the needs of your workforce.

That’s why benchmarking should become a regular part of your strategic planning – not just a one-off exercise. Many employers now make benchmarking an annual exercise, aligning it with HR reviews, budget cycles or benefit renewal dates. Setting clear objectives for it and ensuring the tools are in place to monitor, review and measure progress is essential.

Regular benchmarking enables you to track the impact of changes over time, assess uptake and stay ahead of emerging trends.

And by keeping your finger on the pulse, you’ll ensure that your benefits strategy continues to support your business goals, while meeting the evolving expectations of the people who make it happen.