The cost of living crisis continues to make the headlines and despite the new budget introduced by Chancellor of Exchequer, Jeremy Hunt, the government announced the UK was officially in a recession at the beginning of this year. Critics are arguing that claims made of higher growth and increased employment were at worst, not completely accurate.
How can businesses continue to keep productivity and wellbeing high as the UK goes through an unprecedented degree of change? Here are a few of the key trends in the employment market you need to understand to tackle employee satisfaction.
Support for employees through the cost-of-living crisis
A new survey shows that UK businesses aren’t adequately supporting their workforce with the cost of living. Many employees reported not being regularly paid overtime despite employees working those hours. The survey has highlighted the increased impact on employee’s work and health.
The report shows that many employers are underestimating the mental and physical strain that the cost of living crisis is having. Many employers will have to address these concerns if they are to continue to have effective workforces. Employee recommendations included:
- Employers should address and acknowledge the challenges that their employees are facing
- Employers need to improve their communication by acknowledging that they understand their concerns and need for financial wellbeing
- Employers should offer supportive policies such as flexible work, financial wellness programmes or benefits to help alleviate stress-related financial worries
- Employers should invest in training and development to enhance internal skills and potentially offer better financial stability
The survey’s main finding on UK employees has shown that the cost of living crisis reveals that a significant portion of workers are facing financial challenges. Nearly one in six workers (16%) are experiencing severe social distress due to financial difficulties, with 12% constantly struggling and 3% falling behind on bills.
The right to flexible working in the UK
The right to request flexible working has been extended to all employees in the UK. This right was previously limited to carers or those looking after children but will now apply to all employees. This change aims to help individuals balance their work with other responsibilities.
The change allows for more diverse working arrangements, with employers required to consider any reasonable working arrangements. The government believes this extension will particularly benefit older individuals and young people seeking additional opportunities while working. This move creates a particular gap for young apprentices in vocational professions.
From April 6 2024, employees can request flexible working from their first day in a new job. The process has been simplified to encourage a more open dialogue between employers and employees about different ways of working.
For employers who’ve already been surveyed by employees, this may help with employee’s financial burdens. Benefits include increased flexibility and productivity, a better work-life balance and opportunities for training and development.
The downside is that this may increase workloads for employers with frequent requests for flexibility. Employers, however, can refuse any requests for any reasonable, valid business reason under the current legislation. However, the legislation does provide for an open dialogue and may be the start of more diverse and inclusive workplaces, aiding recruitment and retention.
Increase in UK worker salaries
Amidst cost-of-living increases, UK salary trends show a marked increase in weekly earnings for full-time employees. Since April 2023, the median weekly earnings for full-time employees was £682, a 6.2% increase on the previous year. Additionally, women have seen a large increase with a 6.8% increase and a comparable 9.1% for men. Both experience average weekly earnings of £666 in comparison to the previous year.
The evidence points to the factors that may have positively impacted these increases. The National Minimum Wage for individuals aged 23 and over was increased to £10.42 in April 2023. Into 2024, there is an expectation that formal characteristics, such as age, organisation size and industry sector will impact salary trends as cost-of-living increases continue to impact the working-age population.
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