February 1, 2024
New research investigating how cost of living pressures are impacting the workforce has found that three quarters (74 percent) of HR leaders fear the cost of living crisis is affecting employee performance. In the survey of 500 UK HR Directors, carried out by Nous.co, a third (34 percent) of HR leaders said they’d noticed a drop in productivity due to employees having other things on their minds. Three quarters (74 percent) said financial pressures were directly affecting employee performance.
These concerns were echoed by the chief executive of Mental Health UK last week, who warned that financial pressure was one of a number of factors fuelling stress, anxiety and burnout in the workforce. The findings come as cost of living data released by the ONS this month saw inflation rise to 4 percent and core inflation remain stagnant at 4.2 percent, with around 4 in 10 energy bill payers struggling to afford payments and a third finding it difficult to pay their rent or mortgage.
According to the survey, two in five HR leaders believe employees are doing additional ‘life admin’ on company time specifically due to recent cost of living pressures. When asked what changes they’d noticed in their workforce since the cost of living crisis began, 40 percent of respondents confirmed that they believed employees were doing additional life admin – for example, trying to find cheaper energy tariffs, or speaking to mortgage lenders – during the working day. A fifth of respondents (18 percent) believed employees at their companies had taken annual leave to manage their bills as a direct result of increased pressure on household finances.
In response to the challenges presented by rising living costs:
- A fifth (18 percent) of HR leaders surveyed said their organisation had offered employees additional time off to support them through the cost of living crisis
- A quarter (26 percent) were offering a workplace counselling service to staff
- And just under a third (30 percent) were offering financial programmes to directly tackle cost of living challenges
- More than half (56 percent) of the HR leaders asked had increased salaries to support workers
- 2 in 5 (38 percent) had given employees one-off support payments