Article by latest.insure
Australian employees are reassessing what keeps them committed to a role, and increasingly, it’s about more than just the pay packet.
While salary remains a strong motivator, recent research shows more than six in 10 Australians would leave their job for a 20% pay increase. But there’s more to the story.
Even those not actively job hunting are increasingly open to new opportunities, with nearly 90% of workers in 2025 considering changing roles for improved conditions, not just higher pay.
The Big Shift in What Workers Want
The landscape of employee expectations has changed. Perks like Friday afternoon drinks or a reserved parking spot no longer top the wish list. Today’s workforce seeks flexibility, wellbeing initiatives, and genuine recognition for their efforts.
The 2025 People at Work report from ADP reveals that more than half of employees have noticed an increase in workplace stress in the past year, and almost 20% report experiencing burnout on a weekly basis. These pressures are prompting many to reconsider their priorities and seek out employers who offer better support for wellbeing.
That’s why 62% of Australian workers plan to job hunt this year; not just for money, but for roles that match their values and lifestyle.
Perks that Pack a Punch in 2025
In a highly competitive labour market, SMEs must be strategic rather than simply increasing spending to retain top talent. Thankfully, the perks workers really want won’t break the bank.
Top priorities for Australian workers in 2025 include:
- Flexible work arrangements, such as remote options, compressed workweeks, or flexible start times
- Mental health resources, including access to counselling, mental health leave, and supportive workplace cultures
- Extra leave entitlements, like the option to purchase extra leave, birthday leave, or time off for volunteering
- Opportunities for professional growth, such as training, mentoring, and career development programs
- Transparent career progression pathways, so employees understand their future prospects within the business
These perks boost satisfaction, build loyalty, lift productivity, and cut turnover costs.
Why SMEs Can’t Afford to Sit Still
While large organisations often have more money to spend on perks, SMEs can use their flexibility and stronger team connections to offer meaningful benefits.
Still, many small businesses are yet to catch up with what employees now prioritise, such as benefits like flexibility and wellbeing support. Staff often value these as much as, or more than, salary.
It’s not just about staff satisfaction – mental health issues are now a major workplace risk. Psychological injuries make up 9% of serious workers’ compensation claims, and these claims have surged by nearly 37% since 2017–18, according to Safe Work Australia. On average, employees with mental health claims take more than four times as long to return to work compared to those with physical injuries.
Workplace health and safety laws now require businesses to manage psychosocial risks in the same way they manage physical hazards. New Codes of Practice and resources are available to guide compliance. Supporting mental health, offering flexibility, and building a positive culture are no longer optional – they’re central to running a sustainable, legally compliant business.
Why Talent is Harder to Hold in 2025
Australia’s labour market remains tight in 2025, with unemployment steady at 4.1%, a participation rate of 67%, and underemployment at 6%, figures from the Australian Bureau of Statistics show.
This means over 1.5 million Australians are either unemployed or underemployed, so while there’s a pool of available workers, competition for skilled talent is intense.
What it Means for Your Business Insurance
Introducing new employee benefits, such as remote work, wellness allowances, or professional development initiatives, can alter your business’s risk profile. For instance, remote or hybrid work arrangements may impact your workers’ compensation obligations or require adjustments to your property and liability insurance.
With competition for talent at an all-time high, the right mix of perks and business insurance protection can help your SME remain competitive and resilient.
