'We believe that 70% of the workforce are being left behind'
This article was created in partnership with Auto-UX.
As Australia’s cost-of-living crisis deepens, employees and employers alike are feeling the pressure. While headlines focus on rising mortgage rates, energy bills, and food prices, a quieter but no less significant burden continues to weigh heavily on household budgets - personal transport.
Greg Parkes, CEO of Auto-UX, believes a well-established but underutilised benefit - novated leasing - may hold the key to alleviating this financial strain. The challenge, he told HRD, lies not in the value of the benefit but in how it’s being delivered.
“Financial stress in the Australian workforce is at an all-time high,” Parkes explained. “Forty-five percent of full-time permanent employees are experiencing moderate to high financial stress.”
The ramifications are not abstract, they’re measurable in the workplace. As Parkes told HRD, employees who’re experiencing financial stress are two times more likely to be disengaged.
“From a productivity perspective, they lose seven hours of productivity per week. They have two times more sick days. [What’s more], there’s a really strong correlation with financial stress and anxiety, depression and burnout.”
So, what does transport have to do with that? Well a significant amount as it turns out. In 2025 transport is estimated to account for 14% of total household spending in Australia - and that trend is climbing.
“Over the last two years alone, there’s been a 10% increase in the general cost of transport,” added Parkes. “Insurance, for example, has been one of the headlines that’s driving that increase.”
And despite this growing burden, most employees are still missing out on a powerful cost-saving mechanism.
“Novated leasing is this incredible benefit that’s been around for almost 40 years - on our program saves an employee $8,500 compared to other finance methods every single year,” explained Parkes.
It’s not a figure to be snubbed at, especially given that in 2025 92% of full-time permanent employees either own or finance a personal motor vehicle. Seventy-five percent of those employees actually use that car to get to and from work. And yet, most employers that Parkes talks to usually have an adoption rate of 10% or less on novated leasing.
Simplicity, flexibility and low cost
But that gap, Parkes told HRD, is all down to a lack of communication and connection.
“If novated leasing is this incredible benefit that saves employees thousands of dollars, and we’re in this cost-of-living crunch where transport’s a key part of that, why aren’t more people adopting novated leasing?” Parkes asked. “It’s because we’re not cutting through. It’s being delivered the same way it was delivered 40 years ago and clearly that’s not making an impact.”
This is where Auto-UX comes in. Parkes and his team of experts have set out to resolve this disconnect across age groups. Their insights so far show evolving consumer behaviour that traditional leasing models have totally failed to address.
“Under 30-year-olds make up 23% of the workforce,” Parkes told HRD. “Sixty-eight percent of them are financing a car. For them, it’s got to be fast, it’s got to be digital first and it’s very peer influenced. They trust friends, online reviews, and fintech brands. Their key drivers? Simplicity, flexibility and low cost.”
For the 30 to 49 demographic, representing nearly half of the Australian workforce, the motivations are more financial in nature. As Parkes explained, they prefer a more balanced approach of a mix of online research and financial advice.
“The key drivers for them are optimising household finances and tax benefits.
And then for the 50 plus year olds, their decisions are made quite differently. It’s very advice-led, very conservative, more aligned with established institutions. And they’re thinking more about legacy and retirement planning.”
Despite these differences, one issue is universal - the outdated delivery of novated leasing is failing to resonate with a large proportion of the workforce.
“It’s very old-world,” added Parkes. “You have to talk to salespeople in call centres that ask you so many questions and then they email you a quote – then you have this backwards and forwards over an extended period,” Parkes told HRD. “If we put those first two age groups together, that makes up 70% of the workforce. And we believe that this 70% of the workforce are being left behind.”
There’s also a psychological barrier to entry, especially among younger employees. After all, novated leasing is complex – something Parkes readily admits.
“Just listen to the name of it,” quipped Parkes. “If you haven’t heard about a novated lease before, it doesn’t sound like a very appealing thing you want to find out about. And if you do want to find out about it, you probably want to get your head around it before you talk to someone because you don’t want to feel silly on the phone and get sold to at the same time.”
Auto-UX’s digital-first approach aims to resolve this problem by making the benefit accessible, transparent, and self-directed. And the business case for increasing engagement is just as strong as the personal one.
“We talk a lot about the 25% challenge,” added Parkes. “Whether they’re offering novated leasing yet or not, we put the challenge to employers - what if we could increase your participation in novated leasing by 25% by digitising it?”
The savings are substantial here too. In a 100-employee company, a 25% lift would save employees $212,000 per year. In a 1,000-employee company, that figure would be $2.1million in pure cost relief for your people. And the indirect benefits can be even more impressive.
“What would that do for mental health?” asked Parkes. “We think that would go quite a long way to reducing anxiety, depression, and burnout. Based on our stats, for that 100-employee company you’d get over 8,000 productivity hours back by having a 25% lift. Add another zero to it for 1,000 employees. For a 100-employee company, you get 50 days back. For a 1,000-employee company, you get 500 days back.”
‘Imagine what that would do for retention’
There’s also a hidden financial upside for the employer that many overlook. Not only does it not cost the employer anything, it actually reduces their payroll tax liabilities. As Parkes told HRD, with the 100-employee company example, they’d save $24,000 in payroll tax per year. At 1,000 employees, you’re approaching a quarter of a million dollars. And while some impacts are harder to measure, their presence is hard to deny.
“Imagine what that would do for retention,” added Parkes, “If you were saving your employees that much money that would absolutely help you retain more staff.”
So how should companies reframe novated leasing - not just as a niche finance product, but as a strategic lever in a tight labour market? It’s all about the delivery.
“A lot of the CHROs we’re talking to are concerned with technology and HR tech,” explained Parkes. “There’s lots of things that companies want to experiment with and leverage for the betterment of their people and for their businesses. But a lot of those things are big decisions. They cost lots of money. There’s whole change management programs to implement them.”
With Auto-UX’s digitised platform, novated leasing doesn’t require heavy infrastructure or cost. More importantly, it doesn’t cost the business anything. There is no integration with payroll systems required. And, better still, uptake can be instant.
“With a digital platform, you can literally launch this benefit with a single email. And with that single email, your employees can instantly digitally engage and start exploring the benefit,” revealed Parkes. “It’s well known that novated leasing is an amazing benefit. But it’s something that is complex for people to understand. This is just an easy way to let people self-discover - which is something that hasn’t been possible in the past.”
Find out how you can reward your employees through novated leasing with Auto-UX.
