Only 8% of businesses are giving staff a pay rise in line with inflation and as a result, staff are leaving
Research from Ayming UK illuminates the impact that the Great Resignation is having on businesses.
78% of firms report an increase in recruitment and training costs. 63% of businesses say staff turnover is impeding growth plans and 60% say it is becoming harder to maintain profits.
Businesses are trying to retain staff through incentives
In an attempt to stop staff from leaving employers are deploying a range of incentives and tactics such as:
- Expanding training and development programmes (31%)
- Introducing loyalty bonus (24%)
- Stress management programmes (23%)
- Increasing annual leave (18%)
- Paying travel (18%)
- Improving food and drink for staff (18%)
- Upgrading offices (13%)
- Subsidising gym memberships (14%)
- Allowing dogs into the office (13%)
However, the key issue is that businesses are not raising pay in line with inflation. If staff receive offers of higher pay elsewhere, they may leave.
Only 8% of businesses have given staff a pay rise in line with inflation
According to research, only 8% of businesses have given all employees inflation-matching pay rises. With the cost of living skyrocketing, this is a big deal.
On average, less than half (47%) of staff have received a pay rise in line with inflation.
To further the blow, almost half (47%) of businesses have not introduced any form of flexible working.
Scott Ward, Partner of People, Performance & Development at Ayming UK, commtented: “Businesses face a fight for talent. The pairing of a buoyant job market and high inflation means employers are stuck between a rock and a hard place.
It’s not always possible to give all staff inflation-proof salaries
“It’s not always possible to give all staff inflation-proof salaries, especially when firms are seeing their own costs go up. Nor is it always possible for employers to offer flexible working.
“But in this market, the best talent will be receiving higher paying offers elsewhere as well as tempting work packages and will leave if they feel their needs are not being met. Above all, employers must weigh up the costs of salary increases against the cost of losing key people.”
Improving mental wellbeing and overall employee experience
HR is expanding in businesses across the country. Accelerated by the pandemic and subsequent lockdowns, HR is aiming to improve the wellbeing and overall experience of employees.
Recruitment and wellbeing is the joint biggest priority among HR teams and 90% of firms are expecting budget increases in the next 12 months.
“HR teams have suddenly found themselves needing to innovate and reinvent the function.
“Firms are really thinking about what their employees want, what will get the best out of them, and re-engineering their working practices to meet new expectations.
“By moving in a people-first direction, businesses will inevitably see spikes in productivity as well as retention,” Wards concludes.
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