The number of employees choosing to take up shares in the company they work for has risen significantly throughout the past year.
Figures from the latest annual ifs ProShare Employee Share Plan Survey reveal increases in both major HMRC approved employee share ownership schemes, the “Save as you Earn” (SAYE) and “Share Incentive Plan” (SIP), as employees increasingly recognise the incentives offered by share ownership. The number of SAYE (the plan which employees are given the right to buy a number of shares through monthly savings) accounts opened rose by more than 150,000 to just over 1.2 million in 2012, while the number of employees participating in SIP rose from 908,905 to 960,988 across the UK.
John Collison, Head of Employee Share Ownership at ifs ProShare said: “With all of the FTSE indices showing steady rises over the past 18 months and several recent examples of employees directly benefitting from share plan maturities, many of the UK’s employees are keen to explore how share ownership can boost their savings. “Similarly, given the strong performance of companies such as BT who operate successful employee share ownership schemes, business leaders are looking at incentives which boost productivity and reduce staff turnover.”
The figures from the 2013 SAYE and SIP survey also reveal further encouraging trends. Employees taking out SAYE schemes are saving more each month on average, rising from £82.02 per month in 2008 to £105.83 in the past year. Meanwhile, those employees investing in a SIP plan saw the monthly average investment rise to £83.37 from £71.86 in 2011. Collison continued: “These figures again demonstrate that employee share ownership is a popular, tax-efficient incentive for employees at all levels. And, following the review by the Office for Tax Simplification for streamlining the processes by which employee share plans are administered in the coming year, it will become simpler for businesses and their employees to implement such schemes.