Workers are increasingly prioritising pension contributions over salary hikes when looking for new jobs, research has suggested. 

Three fifths (60 per cent) of more than 3,100 UK and Irish white-collar professionals prioritise higher employer pension contributions over a salary increase when considering a new role, according to recruitment agency Robert Walters’ Employee Benefits Guide. 

The research also revealed that 72 per cent ranked pension contributions as the most important workplace benefit, more than double the proportion who did in 2025 (32 per cent). 

Should employers overpay staff to avoid pension compliance risks?

One in six employers have never reviewed their workplace pension scheme, survey finds

Government revives Pensions Commission as 15 million workers undersave for retirement

Seven in 10 (70 per cent) respondents said employer pensions made them feel more financially secure and 83 per cent claimed contributions influenced their loyalty to an employer. However, 51 per cent were not confident their pension savings would be sufficient for retirement.

Charles Cotton, senior policy and practice adviser in pay, reward and performance at the CIPD, said changes in the labour market could be encouraging workers to seek a larger pension pot in case their skills and experience become less sought after. 

“Employees are becoming more discerning when assessing job offers, considering the overall benefits package rather than salary alone. Financially savvy employees also recognise that pension contributions can benefit from compound growth over time,” he explained. 

He added that pension contributions can be more tax efficient than salary increases, and that some people may prioritise their pension so they can afford to retire before reaching state pension age.

Increased awareness

Duncan Brown, associate at the Institute for Employment Studies, said greater awareness of the limitations of the state pension could be encouraging more people to favour private schemes. 

“It’s particularly interesting that this is happening at a time of very immediate cost of living pressures, when you might expect many employees are having to focus on their immediate cash needs,” he added.

In light of this, Brown said that, despite increased awareness, some young people were opting out of pensions because of cost pressures. Figures from the Department for Work and Pensions cited by BBC found the percentage of 22 to 29 year olds opting out had risen to 11.5 per cent in Q3 in 2025-26, up from 6.6 per cent in the same quarter of 2020-21. 

However, he added that many young people were becoming much “more aware of their need to save as part of their future financial wellbeing, with social media influencers and commentators, online banks and improved employer pension communications all playing a part”. 

Innovation and clear communication is key

Robert Walters’ research suggested that those receiving employer pension contributions were more likely to be satisfied with their overall benefits package. 

Three quarters (75 per cent) of respondents receiving employer contributions of 10 per cent or more said they were satisfied with their overall benefits package, compared with 40 per cent of those receiving contributions of up to 3 per cent.

Cotton said employers should therefore ensure employees understand the value of the pension provision already available to them.

“Employers should not rest on their laurels, and should look at how their HR teams can get a better return on this investment by ensuring that the pension scheme is communicated to their people through all stages of the employment lifecycle,” he advised 

Cotton added that HR professionals needed to regularly review whether the pension scheme was delivering value for money, not only for its employees but also for the employer. 

Brown urged businesses to view pensions as a “hugely valued and often tax-effective benefit” for employees, not just a cost to be minimised. 

“As well as continuing to improve their pension comms, employers should look at pensions innovations as part of a broader financial wellbeing strategy,” he said. 

He suggested organisations consider contributing to a pension for their lowest-paid workers, and encourage employees to make additional contributions that they match. 

Further reward resources are available on the CIPD’s dedicated topic page