By its very nature, the Covid-19 pandemic held significant implications for the way we work and how employers and employees collaborate. Employers have had to quickly shift to new operational models, and workers adjust to entirely new ways of balancing work and home life, as well as health concerns. As a result, a more involved employer-employee approach became more common. Increasingly, it has become less tenable for employers to adopt an ‘arms-length’ approach to staff engagement. This premise, that employer-employee relations are shifting to a more involved approach, formed the basis of our recent Work Foundation project, Shifting Sands, exploring how employers are reacting to the cost of living crisis. For both employers and workers, the cost of living crisis, driven by a range of economic factors – not least war in Ukraine – has been a hammer-blow. We are living through an unparalleled and enduring crisis in living standards. Inflation has outpaced pay increases and workers are materially worse off than a year ago. Many organisations seeking to recover from the pandemic have had their progress halted, particularly those in energy-intensive industries. Inflation levels persistently in double-digits have caused damage. The number of registered insolvencies in December 2022 was 32% higher than in the same month the previous year. Against this economic context, with inflation wiping out wage rises and businesses finding their operating costs rising, it can be challenging for employers to provide financial wellbeing support for their staff to help buffer the crisis’s worst impacts. Yet we found that a significant proportion of businesses do see themselves as having an important role to play in helping their staff. In a poll of more than a thousand businesses, 66% agreed that employers have a substantial role to play in supporting their staff through the cost of living crisis. This sentiment supports the notion that employers see their role differently because of the pandemic and are more likely to adopt a more involved approach to employee engagement. But underneath this finding, our research pointed to a tendency for employers to look for short-term, adhoc solutions. Rather than adopting a strategic long-term approach, business leaders would more often look to apply a ‘sticking plaster’. While most employers think they have a role to play in supporting their staff, only two in five of those we surveyed (40%) had introduced new support since the start of 2022, and only 18% of employers who had introduced financial support provided above standard incremental pay rises. Of course, certain organisations will be better equipped to provide financial support. Our results showed that larger organisations were more likely to do so. But even where employers are operating to tight margins, constraining their 36 |
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