More than 80% of large UK organisations are taking action to help staff during the cost-of-living crisis, according to research by professional services firm PricewaterhouseCoopers (PWC).
Its survey of 98 heads of reward and reward specialists from 84 organisations with more than 250 employees found that 53% have offered financial support through pay increases for essential workers, 51% have conducted additional pay reviews (51%), and 40% have given out one-off bonuses.
Meanwhile, 15% have implemented other non-monetary interventions, such as increased staff shopping discounts, support with home insulation, financial wellbeing programmes and employee hardship funds.
A majority (82%) have increased their pay budgets by 1.5% to 4.5% in early 2022, up slightly from 2% to 3% in previous prior years, and just 18% had a budget for a 4.5% pay increase for 2022. Most conducted their pay budget reviews earlier in the year before the record high inflation and very few have decided on 2023 pay budgets.
Respondents also said that they are looking at how to use financial reward to deal with talent scarcity, attrition and cost-of-living challenges, with 46% using retention awards, 24% sign-on bonuses and 22% changing pay bands. More than half (62%) have introduced greater flexibility for ways of working and hourly patterns, including remote-working policies (44%).
Alastair Woods, pay and employment partner at PWC UK, said: “The interventions, financial or otherwise, being made by the majority of large UK employers will be some relief to workers but while large organisations are able to step in and offer salary uplifts, this won’t be the same across the board.
“A more flexible and innovative approach to reward and working conditions will be critical. Organisations are investing in programmes focused on wellbeing, flexible-working patterns, career ladders, and new and more personalised benefits. Despite the difficult economic conditions, we expect organisations to continue to find ways to support staff and, where sustainable and affordable, agree pay budgets for 2023 at a level not seen for decades.”