In the current climate, no matter what side of the desk you’re on, we’re all feeling the pinch in some way.
Faced with the cost-of-living crisis, businesses find themselves navigating uncharted waters. Rising inflation, housing costs and overall economic pressure impacting employees, it has become increasingly challenging for many individuals and families to make ends meet and an employers’ role in contributing to the financial wellbeing of their workforce is more critical than ever.
At the same time, whilst statistics show that there are more candidates in the market than this time last year, many employers are still struggling to find the talent they need to fill available roles. In some sectors, the number of vacancies still outweighs the number of available candidates, and across the board, candidates generally hold the bargaining power when it comes to negotiating pay and conditions. There are some early signs that this could be levelling out, but employers who plan to simply wait it out might suffer the consequences in the meantime.
According to a 2023 study conducted by the Page Group showed that half of workers surveyed (all of whom were white-collar professionals) were either actively looking for a new role or planning to in the next 6 months. Only 1 in 10 employees were confident they’d remain in their current role this year.
WHAT DOES THIS MEAN FOR EMPLOYERS?
Competition is tough. Even more so with the rise of remote and hybrid working, employers are not just faced with competing in their local job markets but also nationally. Candidates are highly motivated to boost their pay packets and will do so, even if it means changing jobs and all the associated risks that come with a job move.
For most employers, it’s frightening to consider what your businesses would look like if half of your workforce left within the next year. We know retention is cheaper than recruitment and considering the current economic situation, it should be at the forefront of employers’ minds more than ever.
An obvious answer is to pay more.
According to the ONS, average regular pay (excluding bonus’) grew by 7.2% between February and April 2023, but with rising inflation in real terms this represents a fall of 1.3%.
But many businesses just can’t keep up with the cost of salary increases. Bringing new staff in on higher wages just to get an offer over the line, or increasing only certain individuals or departments, isn’t going to be productive in the long run either and is likely to negatively impact the morale of existing employees.
THE GOOD NEWS
If salary increases aren’t a viable option, then all is not lost. There’s no denying that salary plays a huge role in employee engagement but it isn’t the be all and end all.
This is where benefits come in. There’s a whole raft of added extras you can offer to your staff which can help in different ways. There’s not going to be one perfect solution that suits everyone, but a well-rounded benefits package which aligns with your business ethos could make all the difference when it comes to retention.
Given the cost of living crisis it comes as no surprise that some of the top trending benefits are those that allow staff to make their pay packet go further, or those that support overall wellbeing:
Additional paid days holiday
Subsidised food / travel
Family friendly policies – like enhanced maternity pay
Employee discount scheme
Access to health and wellbeing programmes
Training / Qualifications
Access to an Employee Assistance Programme (EAP)
Private Medical Insurance
Cycle to work scheme
Allowing time off for charity or voluntary work