Are we at a Tipping Point for International Employee Benefits?

Are we at a Tipping Point for International Employee Benefits?

By now, we are all well-versed in the reality that there’s an ever-increasing pension funding gap globally.  After all, we are living longer and aspiring to retire earlier and most advanced nations are struggling with how to cope with this at a state level.  The same applies across the spectrum of employee benefits not just in mature, sophisticated markets but increasingly for expatriate and international workers too, perhaps even more so.

Those considered to be ‘international’ often cannot avail of first-pillar state pensions and may not be able, or willing, to make prolonged retirement savings through a domestic occupational or personal arrangement.  The challenges in delivering other financial protection and wellbeing benefits across an international, often fragmented, workforce are clear and abundant. 

The traditional ‘expat package’ of high salary and bonus, alongside accommodation and education expenses has become something of an anachronism.  Now, itinerant careers and long-term international placements are commonplace, not to mention the rise of the ‘digital nomad’.  The growing demand is for career-spanning benefit packages that can flex during their lifecycle.  In other words, international workers appear to be seeking at least the same financial protection, incentives and employment support that their equivalent ‘home country’ employees are becoming accustomed to.

Consequently, global companies with an international workforce, and who strive for a competitive edge in the employment market, will look to replicate as far as possible the benefit packages that domestic employees enjoy.  Thankfully, cross-border pensions, savings and protection expertise is in abundance in an International Finance Centre such as the Isle of Man.  And importantly, the environment in which these companies operate provides the perfect governance framework, bolstered by first class regulation.  Building a benefit programme across providers in a stable, reputable jurisdictions such as the Isle of Man is ideal for sheltering savers from any economic or political risks that exist in other countries in which they might work during their careers.  They provide access to an international transaction and investment capability too. 

It’s a long-preserved notion that employee benefits, particularly those of a financial nature, are sold not bought in that potential corporate clients must be presented with, and subsequently convinced of, the benefits before buying.  But now, due to employee demand, corporations are having to pay attention to the obvious necessity.  We could well be at a tipping point where demand for high quality supply tips the equation such that buyers, rather than sellers take the lead.