We constantly hear news about the severe talent shortages, and here at TurnerFox, we’ve been reporting on the impact of the great resignation in our blogs and conversations with clients throughout 2022. Now we face the challenge and impact of the cost of living crisis within the recruitment industry. Work-related costs have risen for almost all workers, from childcare to commuting costs increasing. We’ve found that companies are budgeting far less for 2022 salary increases compared to the inflation rate.
The financial implications this can have for employees could cause potential issues for businesses as employees start looking for higher paying salaries elsewhere. Other staff retention issues include the increased demand and expectation for flexibility, hybrid or home working. Lord Sugar recently rebelled against this hybrid working culture by taking to his Twitter feed to rant about home workers stating they are ‘lazy gits’ who need to ‘go back to the office or be fired’. Luckily most employers don’t take this viewpoint, and hybrid working can be used as a flexible privilege to help employees strike a balance and save on travel expenses.
There is a combination of challenges businesses are facing in Q4 2022 and beyond that include:
- A combination of rising energy costs, inflation and the cost of living crisis represent the most significant threat facing two-thirds of businesses (65%) in the next six months.
- A fifth of mid-sized businesses says recruitment and retention are the biggest threat they face over the same period.
- Over a quarter (28%) are raising pay in line with or above inflation amid fierce competition for talent.
What can employers do to help?
Prevention is better at this stage, so it’s important employers have open conversations about financial well-being with staff members. Offer support, flexibility and understanding. Many are requesting a higher base salary to offset both regional cost of living variations and the current cost of living squeeze. Conversely, some employees are opting to take a 2nd job to cover the increasing cost of living.
What is the impact on employers?
In this candidate-driven recruitment market, it’s been difficult for businesses to find qualified employees they can afford. Often forcing them to offer increased salaries and benefits to attract talent. Causing a financial strain that some companies may be unable to sustain.
Other benefits may not be directly financial but would make a difference to your staff now, such as additional holidays or flexible start and finish times to encourage work and life balance.
Now is an excellent time to review and revise your recruitment strategies and streamline your processes to make recruiting quicker and easier while significantly reducing the time and cost of hiring.
As recruiters with decades of experience, we’ve ridden storms and understand the changes in demands and requirements as the economy changes before our eyes. We flex with business demands to help you compete and recruit the resources you need to thrive during this time.
Contact us to chat about your business, and let’s see how we can help support you today.