Keeping Up With Inflation While Making Your Employees Happy
As inflation continues to hit U.S. workers, they struggle to pay for basic needs such as gas, housing, groceries, and much more. When inflation rises, the buying power of workers’ take-home pay shrinks. A study by the U.S. Bureau of Labor Statistics (BSL) showed that average hourly earnings fell 3.6 percent from June 2021 to June 2022. While wage growth rose to the highest it has seen in years during the pandemic, 55% of employees still say their earnings are not keeping up with the highest inflation seen in decades. This has forced many employees to look for other jobs that pay more, or for some, they had to take on side hustles to earn extra money to get through these challenging times.
What To Do As A Business Owner
Inflation has put more pressure on business owners to increase the wages of their employees. According to a study, 63% of businesses say they will adjust wages in response to inflation. Even after many employers increased wages, these increases haven’t been significant enough to cover increased prices for necessities. As a business owner, you understand the effects of inflation and how it affects your personal life, so you can only imagine its impact on your employees.
If increasing the wages and salaries isn’t working with the detrimental effects of inflation, what else can you do? The following are ways you can support your employees during these unprecedented times:
- Offer bonuses more frequently
- Offer flexibility
- Provide competitive benefits
- Promote from within
- Offer career development
Conduct A Market Analysis
In addition to being creative with how you can offer your employees more money, a market analysis is an additional step you could take. A market analysis is a detailed assessment of your business’s target market and the competitive landscape within a specific industry. They typically include quantitative data such as the actual size of the market you want to serve, prices consumers are willing to pay, and revenue projections.
In addition, conducting a compensation analysis reviews employee pay about an organization’s pay philosophy. It ultimately considers internal equity and external competitiveness to ensure your pay is fair and will attract, engage, and retain talent. During unprecedented times, you must stay competitive and do your best to attract and retain top talent.
Partner With GMS
As a new year approaches, you’re getting ready to kick-start the year strong. However, adding in inflation and dissatisfied employees makes it quite challenging. Fortunately, when you partner with GMS, we give you the resources you need to start the new year off the way you had planned. Our HR experts work with you to conduct a market analysis to ensure all employees are paid fairly and create salaries for future employees that are competitive enough for your industry. GMS makes your life simpler, safer, and stronger. Start the new year strong and partner with GMS. Contact us today.