Economic conditions are reaching troubling new lows. The Prime Minister recently called the situation “a profound economic crisis.” There can be no question that the recent soaring inflation rates and rising prices are having an impact on your workforce. The current storm of economic difficulties has been termed a “cost-of-living crisis,” and for good reason. Many of these issues have already financially impacted thousands of employees across the UK, leaving many people concerned about their future. As energy prices continue to skyrocket, more and more workers are feeling the pressure as the winter brings colder weather and more heating costs.
As an employer, it is critical for you to understand how your employees are being impacted by these economic uncertainties so that you can take action to help them navigate through the crisis.
employee interest in remote work remains strong
The COVID pandemic changed much about how we work and live in the modern world. In a short period of time, businesses had to shift to adopt remote and hybrid models in order to continue serving their customers. Even with the pandemic largely in the rear-view mirror, many employees appreciate the benefits and better life/work balance that have come from remote work. Additionally, employers have been able to save on real estate space and commuting expenses thanks to this new mode of work.
Our research indicates that these preferences have remained consistent amid the current crisis. The majority of workers (60%) state that it is more cost-effective for them to work either remotely or in a hybrid format.
[Randstad survey data] amid rising energy prices, is it more cost-effective for you to:
- Commute to work - 40%
- Work from home - 39%
- Home/workplace split (hybrid) - 21%
This statement is to be expected as both remote and hybrid working options enable employees to save money on fuel which is also becoming increasingly expensive. On the other hand, a significant minority of employees continue to feel that it is more cost-effective to commute to work. This may be due to the fact that they can use less energy to heat their homes while working in the office.
many employees are taking second (or third) jobs
As an employer, you may soon be hearing many questions from your employees about what the rules are around them taking second or third jobs. Indeed, you may have already started to hear questions like this. Although it can be difficult for employees to speak up about these kinds of issues, the current economic difficulties have placed many workers in a position where they feel obligated to take a second job. In fact, Randstad research shows that 55% of employees have either already taken or are actively considering taking a second job.
[Randstad survey data] would you consider taking, or have you already taken, a second job to pay for the increased cost of living?
- No - 45%
- Yes - 55%
This development has been increasing for several months as employees have continued to be hit hard by rising prices. In late September, the BBC ran a story in which they stated that their research suggested millions of people had already been forced to take on additional jobs. As employees continue to struggle with high prices, this trend is only expected to be exacerbated through the winter months. When dealing with employees who are interested in taking a second job, be sure to take a look at their employment contract to ensure that there is no exclusivity clause. It’s vital to create a safe environment for your employees so that they feel confident enough to ask questions and seek permission before going out to find a second job.
employees do not feel that they are getting the help they need
As the many challenges associated with the financial upheavals have begun to hit home with employees across the country, many have turned to their employers for assistance and guidance. Unfortunately, this guidance and support have been lacking. 81% of employees have stated that they have not received any monetary perks as a result of the cost of living crisis. Only 14% stated that they had received any kind of salary increase.
[Randstad survey data] what monetary perks are being offered to you by your employer to assist with the cost of living crisis?
- none - 81%
- salary increase - 14%
- one-off bonus - 3%
- contribution to personal bills - 2%
Research has also shown that many employees are not getting any access to helpful money management advice. In fact, 74% of all respondents in a recent survey indicated that they were either receiving no advice or were unaware of whether or not their company provided such a benefit. Offering support like this can be an excellent way for companies to help provide recommendations to help their employees through these difficult times.
[survey data] does your employer offer access to financial well-being/money management advice sessions to help with the rising cost of living?
- Yes - 26%
- No - 39%
- Not Sure - 35%
employers still have options
Although economic conditions may preclude you from providing cost-of-living wage increases or bonuses, there are still many ways in which you can help your employees. For example, you could provide financial advice sessions where you teach the 50/30/20 rule. This is a best practice model that states that you should spend up to 50% of your income on needs, 30% on debt repayment and things you want, and 20% on savings. You could also arrange a speaker to provide additional advice and guidance. This can be made even more affordable by hosting the speaker at an online event. You could also provide employer discounts for a variety of products and destinations, such as gyms or restaurants. This can be a great way to help your employees through difficulties while boosting their morale at a time when they feel like nothing is in their control.
why helping employees matters
Not only is supporting your workforce morally correct, but it is also a vital way to retain talent in your organisation. With many employees uncertain about the future, it is crucial that you create a welcoming, supportive environment. If you don’t provide support for your people, your competitors may seize on the opportunity, and you could begin to lose some of your best people. Economic difficulties, such as the cost-of-living crisis, pose challenges for both employees and employers alike. In order to make it through successfully, both groups will need to work together.
- If you need additional support expanding your workforce or looking for advice on HR solutions, request a call from us. We’d be happy to talk.