EF News
Half of North East businesses (50%) have implemented pay rises for their employees to support them through the current cost of living crisis, new research has shown.
In a study conducted by business membership organisation the Entrepreneurs’ Forum, 25% of its 85 respondents had already implemented pay rises in line with inflation while a further 25% had taken action to increase pay but at rates below current inflation.
28% of respondents said they were not currently considering pay rises with many looking at alternative ways of supporting their staff.
In regards to one off bonuses, fewer had already taken action with just 8% having implemented one off bonus payments for all staff, paying all staff the same fixed amount.
However, the survey revealed North East entrepreneurs, regardless of whether they are able to increase pay, are actively introducing other practical support to help their employees manage the rising cost of living.
Implementing flexible working was a popular answer among respondents with employers recognising that daily travel costs can be reduced by removing the need to travel into the office every day. Some members also listed healthcare support and programmes including insurance, free flu jabs and mental health support as benefits they are currently offering their staff.
Additional strategies listed by respondents included encouraging more discussion around the cost of living crisis as well as offering free financial advice, tips to lower bills and access to interest free loans. Some members also stated they are now providing food at work or offering discounted travel and supermarket vouchers.
Elaine Stroud, CEO of the Entrepreneurs’ Forum said, “Our members wholeheartedly value the contribution of their teams and are doing everything within their means to support them with the higher cost of living whilst keeping their own businesses afloat.”
The survey also asked members to list the challenges they expect to face in the upcoming quarter.
A key challenge shared was in relation to customers/clients' reduced spending, especially in relation to their resistance or unwillingness to meet price increases – a factor that is directly linked with the cost of living crisis.
Other wider economic factors such as rising inflation, cash flow and supply chain issues were also raised by respondents as well as ensuring business growth continues throughout an uncertain and unstable economic climate.
Despite this, 73% of members reported that they were feeling optimistic or very optimistic about the year ahead with only 7% of respondents citing they felt pessimistic about the future. The remaining 19% said they felt neither optimistic or pessimistic and there were no noticeable differences in the responses by industry.
Elaine continued, “Despite the current financial challenges faced by our region’s entrepreneurs, we’re reassured that when asked about how they were feeling about their own business’s prospects, most Forum members had a positive outlook.
“It is undoubtedly a challenging time for employers and employees alike with so much uncertainty surrounding the stability of the economy. Yet despite this, Forum members not only remain optimistic about the future but are, in their nature, providing practical solutions and supporting their staff as best they can.”
