The rise of ‘benefitsmaxxing’: UK workers look beyond pay during period of slowing wage growth

London, February 26 2026 – A growing number of UK workers are choosing jobs based on benefits rather than salary alone, as wage growth continues to lag behind the cost of living and employers face mounting cost pressures. The new trend dubbed ‘benefitsmaxxing’ reflects a shift in employees strategically choosing job opportunities based on comprehensive benefits packages rather than salary alone. This new phenomenon is forcing employers to rethink their approach to talent retention at a time when wage growth is failing to keep pace with inflation.`

According to new data from Employment Hero, while pay rises remain the most common reason people change jobs at 63%, employee benefits are now a close third (53%), just behind flexible hours. The findings suggest employees are not motivated by pay alone, with benefits playing an increasingly decisive role in job moves.

The shift comes at a challenging time for UK businesses. Analysis of 117,000 anonymised and aggregated employee records on the Employment Hero platform, reveals that the three-month average wage growth reached 3.6% in January 2026, tracking marginally above inflation. Employers are increasingly under pressure to offer higher, but with rising employment costs – including higher National Insurance Contributions eating into budgets – consistent wage growth isn’t feasible.

Alongside this pressure, the stakes for retention have never been higher. Employment Hero’s research shows that 45% of UK businesses are now spending more on recruitment than in previous years, making the loss of good people a costly proposition that many businesses cannot afford. The challenge is particularly acute for small businesses, which have traditionally lacked the finances to compete with larger employers on benefits.

Speaking of the data, Kevin Fitzgerald, UK MD of Employment Hero, said:

“We’re seeing a fundamental shift in what employees value. Pay obviously matters, but today’s workforce cares just as deeply about how they feel at work. Benefits have become a key part of that equation and businesses that can’t offer competitive packages are finding themselves at a serious disadvantage in attracting and retaining talent.”

In response to this challenge, Employment Hero today announced the expansion of employee benefits within its platform to include health insurance. Powered by employee benefits solution Kota’s embedded insurance offering, the new integration enables small businesses using the platform to access health cover directly within Employment Hero, with access to a range of popular providers. 

Luke Mackey, Co-Founder and CEO of Kota, added: “In a world where over half of workers would change roles for better benefits, companies are under pressure to offer something competitive. Benefits are no longer just a nice to have, they play a key role in attracting talent. At a minimum, employees expect easy enrolment and management of their benefits. By embedding health insurance directly into Employment Hero, we’re removing that friction and helping smaller businesses compete more effectively in the job market.””

Employment Hero’s mission has always been to make employment easier and more valuable for everyone,” continued Fitzgerald. “By integrating comprehensive benefits into our platform, we’re levelling the playing field so that small businesses can compete with larger employers when it comes to attracting and keeping great people.”