As real-time pay fails to keep up with rising costs and soaring inflation, employees are increasingly anxious about their financial situation. And employers are failing to keep up.
That’s according to new research* finds that over two thirds (69%) of employees are worried or stressed about their ability to pay for essentials if the economy worsens over the coming months. A further 22% are concerned about losing their job whilst a fifth (20%) are worried they will need to take on a second job to support themselves.
But, as money worries mount, many businesses are not prepared to support their employees. Although two fifths (40%) of businesses have introduced initiatives to help employees with the rising cost of living, a staggering one in four (24%) are not planning to run any initiatives at all.
Where employees are not supported, this could damage motivation and productivity – potentially resulting in people leaving, or “quiet quitting”. Indeed, a quarter (24%) of employees surveyed state they are unhappy with their employer and nearly 4 in 10 employees (37%) are still planning to look for another job in the next 6-12 months.
While in some businesses, a lack of budget is a key barrier to supporting employees, elsewhere, HR teams are also struggling against a lack of senior support. 42% of HR managers cite lack of budget as the main reason for not actively supporting their employees with the cost of living crisis, whilst over a quarter (27%) cite a lack of senior support.
Pete Cooper, Director of People Partners and Analytics at Personio, said: “Employers know their employees are facing significant anxieties around the rising cost of living, but not enough of them have grasped this issue and truly held out their hand to support. Having a productive and engaged workforce is essential to any successful business, no more so than during uncertain economic conditions. With a significant number of workers feeling overwhelmed and burnt out, employers must re-engage them by flexing their support and doing all they can to help them. Even modest efforts such as discount schemes, travel loans or salary sacrifice schemes could have a positive impact.”
“There is certainly plenty of room for innovation. But, with economic conditions still turbulent, it’s crucial that any decisions are made with the long-term view in mind. To weather the storm ahead and ensure employees feel safe and supported along the way, businesses must ensure their people strategy focuses on being consistent, considerate and compassionate.”
*Research by rom Personio