By Dominic Ashley-Timms, CEO of Notion and Author of new best-seller The Answer Is A Question
The cost of living crisis is hitting UK employees hard, as inflation and living costs continue to rise. While the world is bracing itself for the looming recession, both employees and organisations are forced to make difficult decisions. According to research from the Building Societies Association (BSA), nearly two-thirds (61%) of employed adults are finding that their bills and credit commitments are a burden. Concerningly, 15% of employees reported that they couldn’t cover their living expenses for a month without their primary income source.
Considering the dire economic outlook, it’s unsurprising that so many employees feel disengaged from their work. We’ve faced a turbulent two years, overcast by the Coronavirus pandemic, war in eastern Europe and mounting living costs. The result is a wave of employees who are prioritising their well-being, leading to movements such as the Great Resignation and ‘quiet quitting’ on social media. Now, the onus is on employers to identify ways to re-engage their employees during an incredibly challenging financial period. Here are five ways to support your employees and increase their job satisfaction through the cost of living crisis.
- Review your pay budgets
Increasing your employees’ pay is the most obvious way to support them during a time of financial hardship. Offering competitive salaries is also a good way to stand out in the job market. Naturally, high compensation packages are more likely to attract the best prospective employees.
With that in mind, offering higher pay doesn’t necessarily mean revising all of your employees’ annual salaries. You can provide this type of financial support by way of bonuses. A recent PwC Survey found that 40% of large employers are offering one-off bonuses to their employees in response to inflation concerns. You could also consider offering your employees indirect financial support. The study revealed that 15% of employers will make non-financial interventions, such as helping employees with home insulation and travel.
- Update your benefits packages
Your benefits package is very closely related to the salaries you offer, but you should consider it in detail separately. The most important thing for you to consider is whether the benefits you’re offering employees cater to their needs. Some companies solely provide benefits as a tick-box exercise. The objective is to design a package that meets your employees needs and is easily accessible.
Find out exactly what your employees are most concerned about. This may be the cost of travel, so you could offer season ticket loans. Alternatively, your employees may be dealing with mental health issues at this time. In this scenario, you could offer free employee assistance programmes, with access to qualified therapists and counsellors. It’s worth conducting a survey or speaking directly to your employees to find out what would benefit them the most.
- Bolster your well-being policy
We’ve come an extremely long way as a workforce with regard to well-being. The pandemic highlighted how crucial it is for employees to be happy in order to work productively. But, often, when we discuss well-being, the assumption is that we are referring to mental well-being. The reality is that there are several facets of well-being that contribute to our overall health and happiness.
The World Economic Forum states that there are four dimensions of employee well-being. These are emotional, physical, social and financial. While all four dimensions work together, financial well-being (when an individual feels financially secure) is likely your employees’ biggest concern right now. Identify ways that you can address this within your organisation. You could host educational talks to help your employees improve their financial literacy. You may also consider creating a hub of financial resources (including websites to apply for government support) that’s easily accessible.
- Initiate open communication from the top-down
Providing practical support is key to re-engaging your employees. That said, it’s only part of the solution. It’s equally important to foster open communication across your organisation, and this starts from the top. The worst thing you can do is bury your head in the sand and ignore the economic crisis. Research by the financial well-being platform Wagestream found that 35% of employees believe their employer doesn’t care about their financial well-being. Open communication goes a long way in improving that.
Adjust your communication strategy to create trust with your employees. You should also encourage employees to discuss their concerns with their managers, as well as communicate openly with other employees.
- Retrain your managers
Companies often leave managers to their own devices when it comes to people management. Considering that managers are the first port of call when employees need support, this isn’t the best strategy. We’re experiencing unprecedented financial times, and your managers may not be equipped to support employees through them. In fact, the managers may need support themselves.
Retraining your managers offers several benefits. Firstly, it will equip them with the right tools to effectively manage people during the ongoing cost of living crisis. Besides that, research conducted by the London School of Economics and Political Science (LSE), backed by the Innovation Growth Lab (IGL) at Nesta, proves that good management can deliver significant financial reward.
The study focused on the STAR® management programme, designed by UK consultancy, Notion. It found that the management model delivered statistically significant improvements in engagement, capacity and productivity. STAR® has been tipped by the Government as an answer to unlocking £110 billion trapped in the UK economy.
“You can put all the benefits and all the rewards and all the hygiene factors in one. But if you don’t get your managers to talk to people and engage with them differently, and help build a picture for them of how they can contribute and advance and offer appreciative and constructive feedback, where people really believe that they are being managed and pulled forward and opportunities being opened up to them, then they will go elsewhere or quietly resign in their role, and that’s the crisis.
We need managers to engage with people differently. From an organisational perspective, we want to encourage the conversation that organisations aren’t having, which is “how do we want our management to behave?”
The underlying truth is that organisations need to take action to retain their employees during these challenging times. Employees will engage with organisations that they feel are on their side. The only way to demonstrate that is to help alleviate their financial burden. Support doesn’t always mean dishing out money, but it does require that you actively identify ways to help.