As a business owner, you may have the cost of living crisis on your mind right now. With inflation surging, and the Bank of England (BoE) raising interest rates from 0.25% to 2.25% so far in 2022, your company might be feeling the effects of the economic landscape.
You could already be taking measures to prevent financial shocks to your business, such as:
- Cutting down on unnecessary work travel and other costly overheads
- Strategically increasing prices or fees to match rising costs
- Exploring supplier options to get the best deals available
- Reviewing your company finances with an experienced financial planner.
However, one aspect of your business it is important to continue nurturing, despite financial challenges, is your employees.
Sadly, during the cost of living crisis, your employees could be experiencing their own financial struggles. Indeed, a survey by the Office for National Statistics (ONS) conducted earlier this year found that 77% of earners are “somewhat or very worried” about the impact of the cost of living crisis.
So, where do you come in? Well, you may be surprised to learn that a Canada Life study found that 80% of employees believe their employer should help with the cost of living crisis. If you are in a position to assist, now is the time to step in.
Read on to find out how you can assist your employees during the cost of living crisis.
1. Give remote workers a space at the office
One major contributing factor to the cost of living crisis is domestic energy bills. After Ofgem increased its price cap by thousands this year, the government stepped in, introducing the Energy Price Guarantee (EPG).
Despite government intervention, many people may still be worried about paying their energy bills this winter. Fortunately, as an employer, you can help lighten the load.
If your business renewed its energy contract after 1 December 2021, or is in the process of renewal, it may be eligible for the Energy Bill Relief Scheme (EBRS), a new set of measures laid out by the government.
This scheme is set to last until 31 March 2023, and energy discounts will be automatically applied to eligible businesses. According to the government website, businesses could pay less than 50% of the wholesale gas and electricity prices in some areas.
So, if you have employees who work remotely or in a “hybrid” model, one way you could mitigate energy cost concerns is to offer them a place to work within the office.
Being at the office most days could reduce the amount of energy employees use at home, bringing them invaluable peace of mind.
2. Provide an enviable package of work perks
When looking for ways to acquire and retain talented employees, you might believe that salary is the most important selling point of any job.
While paying a competitive salary is important, a new study by Aviva suggests that work-life balance has overtaken salary as a priority in the post-pandemic job market.
The research reveals that 46% of employees said work-life balance is the most important factor, while 36% would still prioritise salary, a switch in the rankings compared to 2019.
So, during the cost of living crisis, you could ensure your wellbeing-centred work perks are top of the range. These might include:
- A free gym membership
- Regular staff get-togethers outside of work hours
- Private healthcare options, including mental health support
- A competitive number of annual leave days
- Support with childcare for those who need it.
By showing support for the wellbeing of your team, you could reduce employee stress levels during an economically challenging time.
Plus, employees may shave valuable pounds off their monthly expenditure when utilising some of the perks you offer.
3. Offer regular reviews and guidance on employee pension contributions
Worryingly, many employees are expected to opt out of, or lower, their pension contributions in response to the cost of living crisis.
FTAdviser reports that nearly half (45%) of schemes expect pension holders to lower their monthly contributions, with 12% claiming members had expressed desire to opt out altogether.
As an employer, it is important to keep the financial stability of your employees at the heart of your operation. Pension contributions provide a crucial foundation for later life, and while you cannot decide how much your employees contribute, you can offer guidance on this matter.
Indeed, even making employees aware of the ramifications of opting out of pension contributions can help them make informed decisions.
For example, research by AJ Bell claims that a 30-year old employee who pauses contributions for three years could be met with a £25,000 shortfall when they reach State Pension Age.
Offering regular reviews of employee pension payments, and providing insights from a financial professional if necessary, can be hugely constructive during the cost of living crisis.
Get in touch
For guidance on managing the cost of living crisis, please do get in touch with us at DBL Asset Management.
Email email@example.com or call 01625 529 499 to speak to us today.
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Levels, bases of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor.
Workplace pensions are regulated by The Pension Regulator.
This article is for information only. Please do not act solely based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.