The news of an inflation drop to 1.6% in August this year will no doubt be warmly welcomed by many employers. However, the Chartered Institute of Personnel and Development has warned that the struggle to afford salaries that are in-line with the cost of living will still cause financial problems for some companies.
Data from the Labour Market Outlook survey suggests that, although most companies would like to provide their employees with a rise in pay substantial enough to bridge the gap between salary and the cost of living; any form of wage increase will probably be based on overall business performance.
With this in mind, it seems paramount for any business to manage their employment strategy very carefully; ensuring focus and drive is maintained within the workplace. And during times of such austerity, it makes it all the more important for a company to adopt an ethos based on a hard-working, determined and loyal team.
Charles Cotton, rewards advisor at the CIPD commented about the survey: “Our data shows that many employers are keen to raise pay in line with inflation but are struggling to close the gap as inflation remains stubbornly high. Line managers and HR professionals need to look at how they can continue to keep employees engaged and performing well in the absence of substantial pay rises, while at the same time limiting the impact of financial distress on employees by offering financial education, debt counselling and voluntary benefits packages.”
Fighting off the Workplace Blues
It’s no surprise then that many organisations are looking for new ways to beat off the ill-fated effects of the current financial climate, to sustain a happy and hard-working environment in the office. After all, when employee satisfaction levels drop, so does business performance – ruling out any kind of salary boost across the company. It’s a vicious circle that – if not managed effectively and quickly – can have a lot of employers to fighting for air just to keep their business afloat.
Of course, there will be many factors that contribute to a company successfully sailing through times of financial hardship, but it all starts with attracting the right kind people to work with you. Hiring a talented, dedicated and enterprising team isn’t a walk in the park, and if not planned properly, may find your organisation swimming with the sharks.
Parker Sourcing makes hiring the right employees for your company much easier.