Discover where your business can take action.
Since the economy reopened following the COVID lockdowns, business has faced recruitment and retention challenges. Increased staff turnover and the competition for people is affecting firms in all sectors across the UK. It’s hampering growth and productivity and putting increased pressure on wages.
A long term solution requires business and government intervention, for more about the role of government in meeting this challenge see our campaign page.
What can business do to manage rising costs?
The CBI has worked with members to identify four areas of action businesses take to manage rising costs in their workforce. Within each section there are three areas you can focus on to have the biggest impact.
You can also read the key takeaways on how businesses can navigate wage pressures from trade unions in a high-inflation environment.
Maximise your potential talent pool
Recruitment has never been more challenging. Now is the time to ensure that your business is engaging with all parts of society, not just your sector or regions’ traditional employee base.
By rethinking job descriptions, focusing on flexibility and new ways of working, embedding diversity & inclusion practices into your business, you could better maximise the broader pool of talent – putting your business in a much better position to attract great staff.
Three priorities for your business:
- Revisit your Employee Value Proposition (EVP). Is it attractive in the current employment market?
- Align your recruitment plans with your Diversity & Inclusion strategy
- Support employees’ career development
Check out the CBI’s maximising your potential talent pool resource for more
Invest in leadership and management
Competition for talent has been intensifying, with people choosing to work for companies with opportunities to develop and make a difference. Businesses that prioritise and invest in good management are more likely to lead engaged and motivated teams.
Three priorities for your business:
- Communicate your company’s shared purpose
- Ensure people management is a shared organisational priority
- Equip managers with the tools and knowhow to lead and manage hybrid teams
Discover more on investing in leadership and management.
Invest in training and re-training
There is a strong case for why employers should step-up investment in training. Investing in training and skills helps with retention as well as your skills pipeline because it reduces the need to recruit to fill skills gaps you may have.
There are wider benefits for firms too: investing in the skills of existing employees avoids the need to recruit and onboard new hires. This helps organisations work more effectively, as on average, new hires perform at a lower level for their first two years on the job.
Three priorities for your business:
- Map out your organisation’s skills gaps
- Build a culture of learning at all levels in the business
- Develop strategic partnerships with training partners
Is your business looking to invest in more training? This could help.
Adopt technology to maximise productivity
Innovation has always been central to business’ ability to overcome disruption, driving up productivity and reducing costs in the long term.
Over 70% of firms say that new technologies have improved business resilience. So, how can your business use technology to optimise workforce planning and productivity?
Three priorities for your business:
- Identify the problem to determine which technology could be best
- Develop strategic relationships with your suppliers
- Involve your people at every stage
Catch up on the CBI @10am: Solving shortages – can technology help? Or listen to the podcast, here.
Discover about how adopting technology could maximise your productivity.
Hear more and share best practice on how your firm can make the most of your data to maximise productivity.
What can business do to support employees?
Discover some of the areas where businesses are taking action to support their employees through the cost-of-living crisis.
Ways of working
Hybrid working
- Some businesses are reconsidering their hybrid working policies to give employees more flexibility to work at home where they are struggling to meet rising transport and fuel costs
- One business has also shifted work patterns to allow people to work over the weekend if they want to, so they don’t have to pay for childcare costs in the week.
Flexible hours
- Some businesses are offering flexible or compressed hours, or letting employees rearrange hours entirely to support staff with caring responsibilities
- Some businesses are offering flexible hours to allow employees to travel off peak.
Transport costs
Public transport
- Some businesses are offering support for employees purchasing seasonal rail tickets
Cycle-to-work
Some businesses are considering if a cycle-to-work scheme is right for them:
- By purchasing a bike/or accessories, those participating in the scheme can avoid high fuel costs by using an alternative to car transport
- Employees also gain financially from the fact that the cycle-to-work scheme operate as a salary sacrifice employee benefit
- This essentially means that an employee gives up part of their salary in exchange for the benefit, which is taken from their gross salary before tax.
Financial support
Payroll flexibility
- You can deploy financial wellbeing offerings within an established, single HR and payroll system that allows employees to instantly access the percentage of wages that they’ve already earned during their pay cycle
- For employees who need to pay significant bills at short notice, flexibility in pay is crucial.
Expenses
- Businesses are considering their expenses policy to ensure employees are reimbursed as quickly as possible. It is essential that employees are paid on time to ensure peace of mind about payment deadlines for example.
Salaries
- Some businesses are considering inflationary pay rises
- Some businesses have brought forward pay review cycles and/or have undergone salary benchmarking exercises
- Some businesses are offsetting National Insurance rises so that employee take home pay remains the same
- Some firms are investing to upskill staff so they can be promoted into higher paying positions.
Support funds
- Some businesses are investing in employee funds for those in need of interim financial support due to unforeseen circumstances
- Some businesses have pledged extra support to customers on low incomes struggling to pay their bills.
Benefits
Pensions
- Some businesses are continuing to pay into employee pensions even if employees choose to pause their contributions.
Employee pricing
- Many businesses offer access to employee pricing schemes that reduce the cost of or incentivise high street and online shopping such as food, retail etc.
- These can also provide reduction in cost or incentivisation for utilities such as phone contracts which are month on month costs for an employee.
Wellbeing provision
Some businesses are offering online resources hub where employees can access a suite of support and resources.
Mental health
- Information on available Mental Health support as well as advice guides are central to employee wellbeing during times of crisis/insecurity
- Some firms are looking at dialing up their forbearance process and offering counselling services to customers and employees
- Have you seen the CBI’s mental health toolkit?
- Other resources for employers and employees include Mental Health at Work.
- To help staff make more informed choices and long-term plans, employers are offering skills sessions, or advice, relating to personal finances, such as how to budget or what to do if you find yourself in financial difficulty.
Physical health
- Gym flex is an example of an incentive which provides money off particular physical health provisions for employees
- This can help to ensure employees maintain healthy habits during times of insecurity, where there is pressure on finances.
Additional resources
- Read the key takeaways on how businesses can navigate wage pressures from trade unions in a high-inflation environment.
Managing Recruitment Challenges campaign page
- For more resources including webinars, videos and case studies see our Managing Recruitment Challenges campaign page.
Upcoming events to help support member peer learning on managing rising workforce costs
- 21 June, Belfast, 10–12:30pm: People and Skills Network – Managing recruitment challenges
- 30 June, Cheltenham, 12–2pm: People and Skills Network – Pensions and your Employee Value Proposition
