There is no question that the cost of living has risen exponentially in the past few months. Both the US and the UK are experiencing 40-year highs of inflation rates.
With sky high prices, employees are asking for pay raises to help them pay for necessities and bills. If they aren’t given one, they are prepared to quit their jobs; inflation is not affecting the ‘Great Resignation‘. A Lattice survey found that 52% of UK workers would leave a job for a salary rise alone – the figure is 49% for US employees.
No wonder workers want higher wages; a BBC survey noted that Tesco, the largest supermarket grocery in the UK, has found its shoppers recently buying less food (and skipping meals) due to the historic inflation rates. Furthermore, some drivers are finding themselves paying £103 just to fill a family car, according to the RAC.
Employers are increasingly called upon to support their employees through this crisis, and many are doing so through wage increases, many of which are benefitting new hires.
Most employers are raising salaries
According to data from the compensation consulting firm Pearl Meyer, 70% of companies noted that had increased pay = in 2022, compared with last year.
44% of those who raised their workers’ salaries said that they did so due to concerns about retention and the increasingly severe cost of living crisis.
In addition, T Rowe Price is not alone in increasing its employees’ salaries early into workers’ careers. In the US, PwC increased all employees’ salary by 5% and in the UK, the firm increased pay by 9%, as well as raised entry-level pay by 10%.
Kevin Ellis, a chairman and senior partner at the UK branch of PwC told Insider that the company is aiming to attract and retain competitive workers.
Ellis said: “We know pay will be an increasingly important consideration given rising living costs – we want to stay competitive and continue attracting the best talent and skills from across the UK. That’s why it’s important to invest now.”
In this competitive labor market, small businesses are also finding that they need to raise salaries to compete with larger firms that often pay more. According to a Vistage survey, 76% of small-business owners said that they have increased wages for their workers this year.
These examples suggest that employers are listening to the needs of their workers in this unique economy.
Retaining talent stems from supporting talent, and in this current inflationary period, workers need to be supported.