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ifs ProShare survey shows business as usual in employee share plans despite economic downtown

27 May 2009

ifs ProShare released details of their annual employee share plan survey today¿ offering a comprehensive picture of all-employee share plans available in the UK. ifs ProShare is a not-for-profit membership organisation that acts as the voice for the employee share ownership industry.

The results for the survey show that despite the economic crisis, there is stability in the Sharesave (SAYE) market, with 43 new plans introduced in 2008 revealing that companies continue to recognise Sharesave (SAYE) as a valuable employee benefit. The survey also shows that take up of Share Incentive Plans (SIPs) remains strong.

Topline results from the survey are as follows:

SAYE:

  • The number of lives schemes has dropped marginally from 683 in 2007, to 667 schemes in 2008, but take up remains strong.
  • 43 companies implemented new plans in 2008
  • The total number of employees who took up 3, 5 or 7 year contracts granted in 2008 was 505,562 - over half a million people.
  • Average savings per employee across new contracts in 2008 was £86
  • As in previous years, take up of 3 year contracts remains the most common

SIP:

  • Take up of SIP plans amongst employers and employees remains strong - 459 companies offering SIP plans were surveyed (up from 389 surveyed in 2007)
  • The most widely offered shares were partnership shares: the proportion of companies offering Partnership Shares has risen from 70% of those surveyed in 2007, to 73% in 2008.
  • Average investment per employee in Partnership Shares each month is £69;
  • In 2008 the proportion of companies offering Matching Shares rose to 51% from 47% 2007.

Commenting on the survey, Head of Employee Share Ownership at ifs ProShare Julie Richardson said:

As in previous years, the survey offers a very insightful view of employee share plans in the UK today, in particular the ways in which companies are looking to facilitate these schemes and engage with their employees.

It is encouraging to see that despite the economic downturn, employee share plans have remained resilient. It is testament to both the durability and attractiveness of SAYE and SIP plans.

SIP & SAYE are both tax efficient savings mechanisms that can enable employees to build up a good level of savings and investment. Their attractiveness is clearly demonstrated in the figures, with many employees investing considerable sums.

Evidence has shown that employee share plans can have a real impact on employee engagement, and the survey demonstrates that both employers and employees continue to recognise their benefits and look set to do so over the coming years.

For further information, please contact Phil Hall by e-mail phall@ifslearning.ac.uk.

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