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UK workers would sacrifice pay for bigger pension contribution from employer

Pensions top the list of benefits for which employees would sacrifice their hard-earned wages today in order to provide for a more financially-secure retirement.

As part of a European study consultants Aon Hewitt polled 1,005 employees in the UK with over 56% saying they would sacrifice pay for a higher pension contribution by their employer.

Joint second on the list was greater financial protection in the event of illness or injury and the ability to take three to six months unpaid or part-paid leave, both with 37%. The latter option is significantly higher than the European average of 26%.

John Puddephatt, principal at Aon Hewitt, said: "Supporting those in retirement is a significant headache for the UK government at a time when public spending is being slashed.

"The war for talent may not yet be in full swing again, but employers need to start restocking their benefits armoury in preparation. Employees clearly value non-financial benefits, and implementing a flexible benefits strategy could not only help a firm’s staff attraction and retention programme, but can be extremely cost effective too."

He added that the increase of the state retirement age in the UK to 66 for both men and women by 2020, and the financial crisis impacting many pension funds, has focused people’s minds on their own long-term financial security.

"It is an absolute turnaround that people are prepared to sacrifice their hard-earned money today for a more financially secure future tomorrow."

This research was part of Aon Hewitt's European Employee Benefits Benchmark, a survey of more than 7,500 workers from 10 of the leading economies in Europe. The Benchmark focuses on the views of workers across Europe on topics such as retirement, employee benefits and other pension-related issues.

Britons were also particularly keen on having the opportunity to undertake an education course of their choice (31% versus 23% across Europe) while having the option to purchase additional vacation days (21%) was another popular choice among Britain’s workforce.