A study of over 4,000 UK workers by Mercer has revealed a change in the mindset of the workforce. Well-being has overtaken financial security as the top concern, signalling a shift from financial security to personal sustainability.
According to the report, Inside Employees’ Minds: Building Confidence in a Changed World report 2025-2026, financial concerns persist, but physical, mental, and emotional health now dominate the conversation following years of economic and social volatility. In fact, a third (32%) of employees report poor mental health, with greater prevalence in younger generations.
Job security has emerged as the top reason employees stay with their employers and this year’s research points to a new phenomenon, ‘job hugging’, where employees remain in roles amid job market uncertainty. Although two-thirds (64%) of employees say they are not actively considering leaving, this appears to reflect broad economic conditions and a desire for financial stability, rather than a materially improved employee experience.
Mercer also note that UK employees are also concerned with the ‘Fear of Becoming Obsolete’ (FOBO) because of gaps in their skills, particularly as AI becomes more prevalent.
The report also identifies an emerging skills gap, particularly in the age of AI. Employees want to reskill but are unsure which skills matter the most; they need support to navigate this. This is particularly prevalent in the ‘squeezed middle’ of mid-career workers (aged 45-54) who face the unique challenges of balancing financial confidence, skills development and career progression.
Often caught between operational demands and limited learning opportunities, only 41% of this group sees clear career progression and only 45% believe they can achieve their career goals with their current employer.
Speaking to Management-Issues on the question of the AI skills gap, Kerry Ghize, UK Career Leader at Mercer, said: “Businesses need to identify and embrace the opportunities presented by AI and it is vital they bring workforces of all ages along with them. To do this effectively requires a review of how work gets done, where AI can support, and how technology works hand in hand with employees. This will also provide a view of any skills gaps across the workforce, and opportunities for growth.
“Businesses can use this information to educate employees, particularly the ‘squeezed middle’, about the career opportunities AI presents and how they can be developed. Businesses that thrive will be those that enable staff to re-skill and upskill, creating a more agile, engaged, and productive workforce.”
Despite a move towards wellbeing, financial security remains one of the main concerns, particularly among younger workers. The study reveals that the primary concern for 18-24 year-olds is meeting monthly living expenses - a concern that is more pronounced for this age group than for any other. At the other end, fewer than half (47%) of employees overall are confident they have sufficient savings to retire. Within this, there is a clear divide on salaries, with only 38% of people earning under £25,000 confident about retirement.
Employers who prioritise strengthening confidence in health, learning, and financial stability will be best placed to retain talent and drive performance in the years ahead, the report argues.
