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The cost of living crisis is affecting thousands to millions of people worldwide, not just in the UK. Nonetheless, this raises a big challenge for employers whose employees are undoubtedly impacted by the economic crisis.
If you’re an employer trying to find ways to financially support your employees during the economic turbulence, keep reading to find out exactly how you can do this.
Cost of living crisis and work
Whilst the cost of living crisis certainly has a correlation with the soaring prices, thus making essential goods more expensive, this can lead to employees, particularly those of vulnerable groups (single parent, carers…) to possibly struggle with making ends meet.
Their monetary problems may catch up to them during work where they may lose focus and are unable to concentrate on tasks or feel motivated to complete them as a result of anxiety and lack of sleep.
In turn, this leads to poor work performance and may cause employees to take time off due to their deteriorating mental health. As a consequence, this also impacts business operations and overall business success.
So, how can employers help their employees?
The answer – is through financial wellbeing support.
Financial wellbeing refers to the feeling of security and controls over your finances, with the confidence that you’re financially secure in the present and for the future. Money is well known to affect our wellbeing in 4 ways of which are:
- Material – goods and services to improve well-being and increase happiness require money
- Psychosocial – having a low income can be stressful which can lead to poor mental (and physical) well-being in the long term
- Behavioural – those with low income are likely to adopt unhealthy habits and behaviours such as smoking and drinking
- Reverse causation – poor health can also lead to reduced income/lack of income
Employers can help alleviate these pressures from employees by providing them with adequate financial well-being support.
How to Financially Help Your Employees During the Cost of Living Crisis
Employers are acknowledging the detrimental impact of the business cost of the living crisis on employees, with 15% of large employers incorporating non-monetary support. You can do the same (plus direct financial interventions!).
The ways in which you can implement financial well-being support include:
1. Pay increases
Your employees’ salary prior to the crisis may have been sufficient for that time, but with the current inflation, it may not be enough to sustain them in the long term. To combat this, offering an increase in their wages may prove to be the extra funds that they need during this time.
2. One-off bonus
If you find that you’re unable to provide a salary increase at the moment, then a one-off bonus may also be beneficial for employees who are struggling financially.
Providing your employees with access to exclusive discounts or vouchers, especially with retailers of household goods, can help to lift some of the monetary burdens off of their shoulders.
4. Employee benefits
There is a wide range of benefits that you could introduce for your employees including employee life insurance, bike-to-work schemes (saving them petrol), flexible working hours (especially for parents with young children), and more.