The impact of the cost of living crisis

Increasing prices of necessities such as food and heating are impacting individuals and businesses alike.

Soaring energy prices, the end of government financial support along with supply chain issues and goods shortages are proving problematic for many business owners. On top of that, you are likely to experience employees requesting pay rises to compensate for the financial issues they are facing with the cost of living crisis.

How can SMEs help their employees with the rising cost of living?

As stated, it’s apparent that if employees are stressed about their finances, it shows in other areas of their life, such as work. Yes, finances are very much a personal matter and may be a little bit of a taboo for most, but promoting good money management and offering support can be constructive for employees.

Free Advice Lines

SMEs can utilise cost-effective ways to show their support and, in turn, it will help employees feel less alone in their worries and recognise that there are others in situations similar to their own. Examples of this could be pointing to charities and organisations that offer, free, impartial debt advice like Citizens Advice, National Debt Line and Step Change. Another consideration could be introducing an Employee Assistance Programmes to provide staff with a safe and confidential space to receive counselling on various topics, including financial advice.

Benefits

If your business currently offers employee benefits such as discount vouchers, gym memberships or healthcare plans, now is a good time to remind them of such perks. Maybe some are not aware or haven’t remembered to take advantage of them. If your business doesn’t offer benefits, you could think about suitable ones that would reduce their cost of living.

Financial Planning

Invest in financial planning for your employees. While this service will cost you, it will improve your employees financial state and therefore their state of well-being, which could contribute to better job performance. Financial planning consists of a specialist meeting with employees to develop a tailored plan for them and their future, giving them peace of mind, the tools to make better decisions, confidence and helps alleviate stress.

What issues are employees facing?

Inflation in energy prices including household tariffs and petrol, a rise in council tax and water bills, not to mention consumer goods are some key areas affecting everybody here in the UK.

The vast majority of people are struggling to pay their mortgages, keep up with rental prices, heat their houses or put fresh food on their tables.

What are your responsibilities as an employer?

It’s your responsibility to make sure staff are paid a fair amount and on time. Other things you can consider to alleviate some financial burden for employees would be to review your reward strategy, your benefits policy and financial wellbeing policy.

Ensuring your employees feel safe, secure and not alone, especially during this crisis, is key.

How can The HR Dept help?

If you need help at this time to manage the costs and people in your business, reach out today and let us guide you through this tough time.

Cost of Living FAQs