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Britain's Got Talent
Introduction
The landscape for employers today is increasingly one of retaining talent and skills rather than external recruitment, both now and for long-term success. A perfect storm is brewing as employers face a variety of pressures, many of them new.
With UK economic inactivity and long-term sickness at record highs, employers are still tackling persistent gaps in workforce participation and productivity. Meanwhile, the tightening of talent pools is noticeable to all, as changes to UK immigration rules reduce visas for degree-level roles, while declining birth rates further constrain the availability of home-grown talent.
Policy change could soon compound the situation further. The new Employment Rights Bill seems destined to create new levels of compliance for employers, the death of zero-hour contracts, and changes in workforce economics.
AI further contributes to the challenge, shaping both recruitment and retention in ways not necessarily expected. Feedback from HR directors indicates that having a successful AI/automation offering would give their company an advantage as an employer of choice. Yet, as more junior roles become automated, a critical question arises: how will tomorrow’s leaders gain the early-career experience they need? If entry-level work is replaced entirely by AI, businesses risk a future talent vacuum. The solution is not to remove junior positions, but to reshape them and ensure new hires still build skills, knowledge, and pathways to progression.
Retaining your best talent company-wide is increasingly no easy matter. Remuneration, benefits, workplace flexibility and succession planning demand a strategic outlook balanced against commercial outcomes.
Our new employer research shows how organisations have become laser-focused on retention. By understanding their biggest risks and the detail of what really matters to employees in 2025, employers are more likely to find effective solutions to complex concerns.
The growing commercial importance of retention
STRATEGIES FOR SUCCESS
EMPLOYER PREPAREDNESS
TALENT CHALLENGES
CONTACT
RESOURCES
STRATEGIES FOR SUCCESS
EMPLOYER PREPAREDNESS
TALENT CHALLENGES
CONTACT
RESOURCES
STRATEGIES FOR SUCCESS
EMPLOYER PREPAREDNESS
TALENT CHALLENGES
CONTACT
RESOURCES
STRATEGIES FOR SUCCESS
EMPLOYER PREPAREDNESS
TALENT CHALLENGES
CONTACT
RESOURCES
STRATEGIES FOR SUCCESS
EMPLOYER PREPAREDNESS
TALENT CHALLENGES
CONTACT
RESOURCES
Partner, Head of Employer Consulting
NICK GRIGGS
Partner and Client Relationship Manager
NICK CLYNES
Partner, Head of Platform & Benefits
JULIA TURNEY
Partner, Head of People Risk
PAUL LEANDRO
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Read and watch our latest insights.
LATEST NEWS
Discover your organisation’s DNA to maximise competitive advantage.
KNOWLEDGE HUB
Take a deeper dive into our industry research.
EXPERT REPORTS
Explore our on-demand webinars and upcoming events.
EVENTS
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STRATEGIES FOR SUCCESS
EMPLOYER PREPAREDNESS
TALENT CHALLENGES
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The challenges reshaping the landscape for talent
Businesses undoubtedly feel the net tightening with decreasing availability of both domestic and overseas talent, as well as the expected loss of current overseas workers.
Tightening talent pools
Rethinking recruitment strategies
Worryingly, our research shows that employers appear to be increasing precious spend on training and benefits, without first having access to the data that shows what matters to employees at different stages of life, their engagement levels with benefits and whether efforts are achieving the employee value that employers aimed for.
The reality is that stronger use of data and analytics is central to helping employers move beyond surface-level data to identify root causes and solutions. For example, by examining whether there is a correlation between mental health PMI claims and human errors being made in the business, or whether turnover patterns stem from issues like culture or management, businesses can uncover the real drivers of risk and performance.
Map your workforce DNA
As a result, investment could fall short of goals if allocated without the data to inform both solutions and effectiveness. It’s data that will enable insight to drive allocation, direction and meaningful tailoring of solutions that match business and employee goals. Crucially, it enables businesses to diversify their talent pool and strike a balance between short- and long-term investment.
While effective spending is always important, it’s even more business-critical now, in the light of potential increases in areas such as employer pension contributions, the minimum wage and taxation.
This is where Barnett Waddingham’s Employer DNA approach can provide a clear, evidence-based view of an organisation’s strengths, gaps, and priorities – helping it make smarter investment decisions, optimise retention strategies, and build a workforce capable of thriving today and in the future. By mapping Employer DNA, organisations can turn insight into action and workforce challenges into a competitive advantage.
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Three in five employers are concerned about the shrinking availability of domestic talent, driven by the long-term decline of UK birth rates.
are concerned about the decreasing availability of overseas talent that they could previously depend on, caused largely by recent changes
in immigration laws.
as many as one in six expect to lose overseas employees because of new policies.
16
%
64
%
%
Barnett Waddingham’s Employer DNA framework recognises the areas of analytics that yield the highest level of business understanding, including:
Your existing workforce segmented by age, gender, role, salary and tenure as a minimum.
of employers track workload levels, staff retention, productivity, or eNPS.
50
Correlations and discrepancies between different data sets (e.g. absence rates vs turnover; employee wellbeing vs existing industry benchmarks).
Benefits usage and engagement levels across all benefits, particularly company-funded ones such as pensions and healthcare. Detailed reporting will often be available from your providers.
Under-tracked areas: eNPS (likelihood to recommend), workload, retention and what matters to individuals.
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DISCOVER MORE
Our data-led article uncovers why employers must understand their business’s unique ‘DNA’ to unlock sustainable ways to positively impact employee retention and development while maximising return on investment.
DISCOVER MORE
BW analyses ageing workforce pressures, skills gap risks, and employees’ mental health challenges to help businesses survive and thrive.
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Data-led insights explore how employers can align benefits strategy with generational needs to unlock productivity, resilience and innovation.
Julia Turney | Partner and Head of Platform and Benefits
Employers should think hard about increasing focus on retention and hiring from alternative sources to secure talent.
With three out of four employers (77%) saying they’re concerned people don’t have the skills they need, our research shows how older workers and those returning to the workplace following extended breaks in their career are increasingly in demand:
An ageing workforce brings additional requirements, from specialised training and development to increased pension and healthcare provision. While there are some associated challenges, such as concerns around training (19%) and insurability (18%), these can be far outweighed by the value these employees potentially add to businesses. As their role in the workforce grows, so too does the importance of pension and healthcare benefits in securing their loyalty and motivation over the long term.
In planning benefits and training company-wide, the need to motivate different age groups effectively has the potential to pull employers in different directions simultaneously if not approached correctly.
Many companies are still being held back by not having gathered the right data on the make-up of their workforce. Those that do will be the winners in building more effective retention, benefits and training strategies. Success will also depend on the market and providers recognising these shifts, and adapting products to meet employers’ and employees’ evolving needs.
are looking for strategies to retain older staff.
Retaining older staff
are now actively hiring older workers.
Hiring older workers
are now actively recruiting people returning from a career break.
Career break recruitment
37%
31%
40%
The prospect of the Employment Rights Bill is already acting as an engine for change as employers adapt their strategies in relation to flexible working, increased protections for the workforce and equality.
Failing to comply with new policy, or eventual regulation, could pose serious corporate risk to an organisation’s integrity.
The shifting policy landscape
Julia Turney | Partner and Head of Platform and Benefits
Working with, not against, employers will be essential if the Government is to ease pressures on businesses while improving outcomes for employees.
As those economically inactive due to long-term sickness have grown from 2.2m at the start of 2020 to 2.7m in 2025, employers are concerned too about factors impacting on the availability of their existing workforce: 73% are concerned about increasing rates of poor mental health, and 68% about increasing rates of long-term sickness.
This tightening pool has resulted in employers adjusting remuneration and benefits to retain their staff. Eighty-four per cent have increased salaries in the past year, 69% healthcare provision, 66% pension contributions and 81% the amount of training they offer mid-level and senior staff.
A shortage of talent, with no obvious new routes for recruitment, risks potential damage to employers’ longevity if they don’t act fast and consider alternative strategies.
say they would be at risk of insolvency
of employers say they would freeze hiring
in favour of tax breaks for private medical insurance
More than ever, employee benefits need to create cost-effective employee value. And the Government has a role to play in this. As long NHS waiting lists persist, 68% of HR directors confirm that tax breaks for private medical insurance (PMI) in the Autumn Budget would be beneficial for their businesses.
After recent increases in employer National Insurance contributions, ensuring costs across the business are allocated to maximise impact undoubtedly features high on employers’ agendas. This comes through strongly in our research, with many employers concerned that the spectre of a potential rise in employer pension contributions could pose a serious cost risk for many.
This is happening at a time when talent is already in its shortest supply, and while the correlation of AI adoption and workplaces is not yet clear, it raises concerns about the use of AI to cut staff rather than to strengthen capability.
Even with job losses having taken place, HR directors feel that successfully implementing AI would give their company a major competitive advantage as an employer of choice. Over one in three (36%) felt this - nearly twice the number (15%) who felt recruiting younger staff would give them an advantage.
Even as AI becomes more embedded, human-in-the-loop (HITL) remains essential for oversight and decision-making. But with traditional career pathways narrowing, the risk is not just skills gaps today, but a shortage of future leaders. Investing in adapting and evolving roles in line with AI will be key to long-term resilience.
Adopted across all sectors and employer sizes, seven in ten (71%) organisations have increased investment in AI/automation this year and six in ten (62%) have trained their workforce on it. And AI is already tightening the labour force. Our research confirms that, due to AI adoption:
AI adoption
have made senior staff redundant
%
15
%
17
have made junior staff redundant
have made mid-level staff redundant
18
%
Paul Leandro | Partner, Head of People Risk
AI must be an enabler and not employed at the expense of a talented, multi-skilled workforce.
%
35
of employees said that their employer doesn't offer PMI, but they would want to use it; the same for benefits like access to a 24/7 online GP (37%).
of employers said they had increased investment in healthcare - a lower priority than salaries and embedding values/purpose.
69
%
As employers focus on retention, what levers have been their instruments of choice to achieve this?
Employer priorities for employee investment
Employer preparedness and gaps
While HR directors have been prioritising increased investment in salaries (84%), it is revealing that, second to this, they have been investing in embedding their values and purpose (81%). With the pandemic leading to increases in home working, and less time in the office environment experiencing their employer’s values, this investment may be designed to demonstrate a tangible, differentiating purpose that builds understanding and retention.
Surprisingly, we find areas such as healthcare (69%), DE&I (68%), and pensions (66%) lower down the list of priorities – although they’ve also had investment increased – raising concerns of a misalignment between companies' actions and employees’ actual needs.
Lower priority
Employee salaries
Higher priority
Embedding values/purpose
Junior staff training
Higher priority
Lower priority
Private healthcare
Investment in DEI
Percentage of pension contribution
84
%
81
%
81
%
66
%
68
%
69
%
The research also shows how employers' relationships with their employees are evolving – with our findings suggesting this shift is moving in a positive direction. In 2023, our research found that just 32% of employers agreed they had a duty of care to their employees. In just two years this number has now nearly doubled to 59%, demonstrating a belief in greater responsibility to their employees.
Duty of care towards employees
More employers also recognise the relationship between employees’ happiness and productivity – this measure rising from 70% in 2023 to 82% in our 2025 survey.
Yet, while employers are clearer on their responsibilities towards employees, just one in six (15%) feel that retaining their existing workforce would give them a major competitive advantage as an employer of choice.
Poor (or no) measurement of key employer metrics is holding back loyalty
Unless correctly managed, there are unmistakable risks of divergences between company actions and what matters to employees. Given ‘what gets measured gets managed’, our research set out to understand what data employers are gathering – and to highlight critical areas lacking sufficient data.
Employees’ job satisfaction is tracked by two in three organisations (66%). Perhaps worryingly, it’s the only employee metric that over 50% of the respondents say they measure. Overall, metrics focusing on business-control measures dominate. Workload is measured by 46% of employers, whilst employee turnover is measured by 42% and absence rates by 39%.
More meaningful measures of what motivates and matters to employees are measured by far fewer organisations. Happiness is measured by just 36%; the same percentage also measure employee stress levels. Just one in six (16%) measure their Employee Net Promoter Score (eNPS), the standard industry measure of loyalty and satisfaction.
Given benefits’ importance to employees – and employers’ high level of investment in them – usage is poorly tracked. It’s ironic that while two in three (66%) employers increased their pension contributions, just one in three (34%) measure their employees’ pension engagement levels – and just 30% measure usage of benefits overall.
Nick Clynes | Partner, Client Relationship Manager
As a business observer, this data is concerning. It demonstrates fundamental gaps in employee data. As a result, employers are simply unable to see their own retention risks, or areas where costs might easily be optimised.
Time is running out for companies that aren’t compliant
Research shows most organisations are already complying with policies likely to be required under the Employment Rights Bill - but some are lagging. While the final details of measures have not passed through both Houses of Parliament yet, it’s a positive step that so many employers are ahead of the game.
are offering workers on low or zero-hour contracts a predictable working pattern.
67%
are offering employees parental leave from day one.
82%
are taking all reasonable steps to prevent sexual harassment in the workplace.
86%
don't offer bereavement leave to all employees (a further 20% aren't sure).
14%
16%
22%
aren't offering employees parental leave from day one (a further 20% aren't sure).
aren’t currently offering a whistleblowing system (a further 23% aren’t sure they do).
Our research shows that employers are increasingly recognising the importance of retaining and growing existing talent, as both UK and international talent pools decline.
This section sets out our recommendations for improved outcomes for employers’ retention and recruitment drives, combining findings from this research and our wider experience with UK employers of all sizes and structures.
Retention through data-driven enablement
Strategies for success
Expand and diversify talent pipelines
Map your workforce DNA
Communicating AI as an enabler
%
Fewer than
Anticipate and implement policy impacts
Using this data to identify where investments are adding value and where costs could be optimised, based on employee preferences and needs.
Tracking the effectiveness and application of training, alongside promotion levels and career progression.
Close
of employers see success in AI as the biggest competitive advantage as an employer of choice.
36
%
When applying AI in their organisation, employers should consider:
Gathering data on productivity and retention at all levels of seniority, enabling evaluation of the true impact of AI across the workplace.
Redefining entry-level roles – not just skilling people in the use of AI for your business, but building experience, knowledge of the business and developing them for more demanding, complex positions in the long term.
Creating an internal culture of education on AI – dispelling myths, discussing benefits to employees and showing how they can get more involved or improve their day-to-day.
Close
Beyond being seen as a competitive advantage, AI is fast becoming a baseline expectation. Employers who fail to keep pace could risk being seen as falling behind, while those who adopt effectively are keeping up with the standards their peers and employees will expect.
Communicating AI as an enabler and competitive advantage
of employers are concerned by shrinking availability of domestic talent.
63
%
Drive increased retention (and referrals) by understanding and prioritising what matters most to individual employees (work time and workplace flexibility, benefits, training) - it often won’t be just compensation.
Invest in overseas talent (where costs and visa permissions allow). Extend role parameters to capable talent outside of the degree-qualified pool.
Review recruitment parameters to include more older workers, and those returning from a career break and those with non-linear career paths - a practice adopted by 31% and 40% respectively of employers in our research.
Close
Expand and diversify talent pipelines
With talent pools tightening and employers concerned about the shrinking supply of domestic talent, broadening who and how you hire becomes a strategic necessity. Shift from degree-first screening to skills-based assessment, bring in experienced returners and older workers, and open routes for non-linear careers – then reinforce this with benefits and flexibility that convert candidates into committed joiners.
Create competitive positioning for recruitment by benchmarking your benefits, workplace flexibility, training programmes (and more) against competitors.
employers said that if their auto-enrolment contributions rose, they would have to reduce other benefits.
1
in
Review measures in the Employment Rights Bill, identify gaps and consider implementing them pro-actively, positioning your business as an employer of choice. Most employers already have many in place.
Identify resulting internal trade-offs that won’t adversely impact employee satisfaction or retention.
Model the cost and business impact of a potential increase to employer pension contributions, minimum wage hikes or benefits restrictions
Close
Policy shifts can reshape workforce economics overnight. Scenario-test employer pension contribution increases, minimum wage uplifts and compliance requirements, then sequence changes to protect satisfaction and retention.
Where feasible, implement best-practice measures early and communicate clearly – turning compliance from a cost centre into part of your employer value proposition while reducing risk and avoiding disruptive, last-minute adjustments.
Anticipate and implement policy impacts proactively
3
We can see how businesses have responded by increasing salaries, training, benefits and employee flexibility to support retention, but this also raises concerns over the long-term needs of a business.
There’s a risk this is being done without first gathering the fundamental data on what employees want and need – and without measuring the impact across basic employee and business metrics.
Research clearly demonstrates how employers’ focus is shifting, in a bid to retain and recruit from a shrinking talent pool.
Conclusion
The Generation Game
The Balancing Act
The Employee Equation
Agree (2025)
Agree (2023)
100%
75%
50%
25%
0%
Disagree
Agree
Agree
A workplace should be more like a team than a family
A workplace has no duty of care to its employees
Employee happiness is critical to productivity
Team building is more important than socialising
A focus on retention has led to a fall in performance
Treating employees fairly improves performance in the long-run
Employees don't understand what it takes to run a business
Employee demands are usually unrealistic
The pace of change means it's impossible to plan for the long-term future
Balance of power between employees and employers favours employees
0%
20%
40%
60%
Disagree (2023)
Disagree (2025)
Balance of power between employees and employers favours employees
The pace of change means it's impossible to plan for the long-term future
Employee demands are usually unrealistic
Employees don't understand what it takes to run a business
Treating employees fairly improves performance in the long-run
A focus on retention has led to a fall in performance
Team building is more important than socialising
Employee happiness is critical to productivity
A workplace has no duty of care to its employees
A workplace should be more like a team than a family
Disagree
Click to read our recommendations
Click to read our recommendations
Click to read our recommendations
Click to read our recommendations
50
%
17
%
68
%
Get in touch with our experts and find out how we can help you to retain your talent.
Partner
Head of People Risk
PAUL LEANDRO
Partner
Head of Platform & Benefits
JULIA TURNEY
Partner
Client Relationship Manager
NICK CLYNES
Partner
Head of Employer Consulting
NICK GRIGGS
Our new employer research shows how organisations have become laser-focused on retention. By understanding their biggest risks and the detail of what really matters to employees in 2025, employers are more likely to find effective solutions to complex concerns.
Rethinking recruitment strategies
as many as one in six expect to lose overseas employees because of new policies.
%
16
%
64
are concerned about the decreasing availability of overseas talent that they could previously depend on, caused largely by recent changes
in immigration laws.
Three in five employers are concerned about the shrinking availability of domestic talent, driven by the long-term decline of UK birth rates.
62
%
Businesses undoubtedly feel the net tightening with decreasing availability of both domestic and overseas talent, as well as the expected loss of current overseas workers.
Tightening talent pools
The challenges reshaping the landscape for talent
CONTACT
RESOURCES