The recent surge in the cost-of-living is putting huge pressure on society. Inflation is soaring, fuel prices are hitting record highs, and tax increases are putting a devastating strain on individuals and families around the UK. Critically, wages cannot maintain the same rate of rapid incline. With the crisis showing no signs of slowing down (The Bank of England predicts the country could remain in this state for another two years), considerations around money are infiltrating every aspect of day-to-day life. This includes the workplace, with 27% of employees claiming financial worries are impacting their performance at work.
In today’s climate, benefits are crucial
Employers have a responsibility to address these concerns and prioritise the welfare of their staff. However, Blackhawk Network’s latest research shows that only 5% of people believe their employer is doing enough to support them at this time of instability. It comes as no surprise, then, that 63% of employees would consider changing jobs in search of better financial support. With businesses also feeling the pinch and unable to match wages to inflation, leaders must identify alternative ways to take care of their workforce.
Employee benefits could be the solution. Now a necessity, rather than a perk, a strong benefits package has the potential to ease the financial burden and improve wellbeing. In fact, over three-quarters (83%) of employees and nearly all (95%) employers agree that they will be crucial throughout this cost-of-living crisis. With The Great Resignation also at play, and significantly shifting power to the hands of employees, leaders must evaluate the strength and accessibility of their workplace benefits in order to retain their top talent.
Why aren’t employees taking advantage of their benefits?
Our research shows a gap in understanding between employees and employers when it comes to work benefits. Most organisations will offer some form of package, but there can be a disconnect during communication. As a result, staff are not always clear on how to take advantage of their benefits and make the most of their resources. Benefits such as hybrid or remote working, which are now commonplace following the pandemic, can help to improve flexibility and manage travel costs. However, businesses have plenty more tools at their disposal if they wish to set themselves apart.
Some may be familiar with salary sacrifice schemes, which give employees the chance to purchase services and products before tax and NI deductions are taken from their salaries. However, almost three quarters (73%) of those surveyed were not entirely clear on the definition of salary sacrifice, with 18% admitting they had never come across the term before. Initiatives such as these can be leveraged to make crucial savings and put real money into pockets, and as such, they demand more visibility. It is the role of the employer to action this change, and improve communication to increase uptake.
A great example of a salary sacrifice initiative is Cyclescheme, the leading cycle to work scheme provider,where employees can save up to 40% on bikes and cycling accessories. As we approach Cycle To Work Day on Thursday, August 4th, businesses should encourage their workforce to take advantage of this scheme, and find out just how much they can save by cutting travel costs.
Where wage increases are unavailable, business leaders can also promote a variety of other employee benefits to help employees spread the cost or access savings on products such as technology and white goods. Comprehensive packages can also include vouchers for weekly food shops; an increasingly valuable benefit as food prices skyrocket to their highest level since 2009.
The time for action is now
The current financial climate is pushing employees to take matters into their own hands, with 24% stating that they have been using their benefits more since the beginning of the cost-of-living crisis. However, employers still need to address the lack of understanding around workplace benefits and open-up better streams of communication to advocate the resources available.With the appetite for benefits clearly growing rapidly across the UK, leaders must recognise the urgency and take tangible steps to respond.
Not only do businesses need to find more effective ways to keep staff informed, but the benefits themselves must be a true reflection of employee needs. At a time of such financial turbulence, these needs are constantly evolving in line with the economic forecast. As such, flexibility and communication are key traits for leaders looking to cultivate a strong benefits programme and mitigate the effects of the cost-of-living crisis.
