The cost of living crisis and it’s impact on recruitment
There has been much reporting in the press about the cost-of-living crisis. UK inflation has risen to a 40-year high of 9.1%. Kantar, the data and insights experts, says that food costs rose by 8.3% between the 15th May and 12th June, and the average yearly shopping spend is now expected to rise by £380 to £4,960 in 2022 – a rise of more than another £100 since April 2022. And now it’s being reported that energy bills are going to rise at an even steeper rate than predicted this winter.
The British Medical Journal is reporting a serious impact on people’s mental health as a result. They report that a YouGov survey shows that 55% of British people feel their health has been negatively affected by the rising cost with a quarter having a mental health diagnosis from a doctor or medical professional as a result.
There has been much research done into the effects on recruitment and job seekers. Work-related costs have risen for almost all employees whether it’s the increased cost of working from home due to energy rises or the increase in childcare and commuting expenses.
The impact on recruitment
Recruitive found that 48% of workers reported not having had a pay rise this year and that, of those who did, 42% had a rise of 5% or less, significantly below inflation rates. They also found that 17% of workers had been forced to find second jobs to make ends meet, shockingly, this figure rises to 20% of essential workers. They estimate that more than 700,000 care workers could leave the profession in the next year.
CV-Library similarly reports that 75.1% of UK professionals are now considering a new job purely because of the cost of living and rising inflation costs they’re facing. They further found, through analysis of their live vacancies, that salaries were not keeping track with inflation and in fact, many industries were offering lower wages than the previous year.
- Retail – 5% down
- Sales – 1.6% down
- Social Care – 1.2% down
- Medical/Pharmaceutical/Scientific – 1% down
Job seekers top requirements fit broadly into two areas, perhaps unsurprisingly, salary and hybrid working.
Salary
TotalJobs found that 37% of workers are considering changing jobs for a higher paying salary than their previous role to cover higher costs, as well as benefits and perks that allow them to maintain lifestyle choices
Recruitive found that nearly 1/3 of job seekers salaries do not cover their current living costs and ¼ said salary is the most important factor when looking for a new job role.
CV-Library, who surveyed more than 4,000 workers, also revealed that for 69.1%, salary is now the main driver when considering a new role.
Hybrid
TotalJobs found that 24% of candidates thought hybrid working was crucial, deciding that the saving on commuting costs was greater than the spending on expenses related to working from home. They found 31% of applicants would avoid applying for a job without that option.
However, CV-Library found that only 14.8% say that flexible or remote working was the most important factor.
What can employers do
It’s clear that this is not a crisis that is going to disappear quickly. It’s also hard to suggest ways that employers can help other than through salary rises and benefits packages that they themselves might be unable to afford. Lobbying the Government for policy level changes and freezing senior pay rises and bonuses seem to be regular suggestions on offer. However, businesses are able to handle the crisis from a financial point of view, they can always be aware of the stress that their employees are under and provide support in terms of flexibility and understanding.
If you would like to talk to us about potential reward and loyalty solutions for your employees, do get in touch.
Remus Rewards
Remus Rewards, a division of People Value Limited, is an REC, FCSA and APSCo Business Partner, a TEAM Service Provider and a market leading provider of reward and loyalty solutions. We specialise in providing solutions to the contractor and temporary labour market across the UK. By using our cloud based reward technology, businesses can improve their proposition, performance and increase engagement, morale and loyalty. Take advantage of savings on high street shopping, including 7 major supermarkets, eating out, special rate cinema tickets, discounted gym memberships and our Fuel Card which offers discounted fuel at over 35% of the UK motorway service stations.
