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How to mitigate pay pressure, especially in hard to recruit sectors

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Posted by Lisa Trewhitt on 07 July 2022

How to mitigate pay pressure, especially in hard to recruit sectors

Pay Fairness | Pay & Reward | Pay Progression | Pay Review | Pay Data

The current cost of living crisis is bringing with it a whole new wave of pay pressure for employers, but traditionally pay pressure can arise when you have an urgent need for hot skills. There is a broad assumption that the tech world experiences the greatest pain points here, and that may still largely ring true, but in the current marketplace skills are less sector-driven than they were, simply because more people can move between sectors. 

Outside of tech, for example in the care sector, skills are also at a premium and can create just as much of a headache. As someone told me recently, “you're not going to relocate to another part of the country for £10.10 per hour”, so employers are having to pay 30% more to get the people they need. It’s all relative.

Of course, this does not mean that there's a bottomless pit of money. We work a lot with charitable organizations and one thing that's really exercising our clients is how to deal with regional pay. If you have people who traditionally worked in London, and now they're all working from home, what do you do? There's an expectation now that you can't take things away from people, but equally you can't keep throwing money at a problem. So how do you mitigate? 

With everything that has happened over the past couple of years, increasingly we’re seeing the concept of ‘hard to recruit sectors’ flattening out into ‘companies who aren't offering a hybrid work model’. As a result, a greater number of sectors are now affected because people want options. It is an employee-led market in that respect, so how can companies flip that dynamic around? 

Making people feel supported

While the employee is now in a relatively strong position, the pandemic was also a period of self-reflection and re-evaluation. Some people felt very alarmed and mentally fragile by the end of it. That same hybrid working model we’ve spoken about also created a lot of introspection, self-assessment and even anxiety, which perhaps wasn't there before. Innovative companies can get ahead of these issues.

For example, during the pandemic concern rose dramatically among both employees and employers in areas like financial wellbeing, health, and death-in-service benefits. I’ve spoken with several clients who lost people due to Covid and, as a direct result, have overhauled their death-in-service and life insurance benefits, or even introduced them for the first time. In the same area of financial wellbeing, some employers are looking at how they can help workers ease debt by accessing and managing loans. It is very common for employees experiencing money worries to either be absent from work or not perform to their usual standards, so while this seems relatively mundane, the pandemic has focused hearts and minds. 

The rise of the Wellbeing App

Let’s face it, everybody wants a bigger salary and more benefits but if that can’t be the answer it's about offering more creative and innovative solutions, alongside existing recognition and reward schemes, upskilling or creating new avenues for progression. Things that don't have to cost a lot of money.

The past couple of years of agile working have also opened employers’ eyes to the growing benefits of HR Tech and health and wellbeing apps such as HAPI. The HAPI app helps businesses monitor and assist workers’ physical and mental health through tips, recipes, advice around sleep, dental health, loneliness, fitness, happiness and even menopausal health, which is increasingly gaining traction. It all adds up to making people feel supported and cared-for, whatever their circumstances. 

Effective communication both ways

Communicating all these things to workers needs to be carefully thought out. Organisations are getting far more aware that they need to communicate and connect with their workforce, but how they do it best is constantly changing. Reaching out to people who are working remotely is challenging. If somebody is fitting their work around dropping off the children or caring for a parent, not only the content but also the means of communication needs to be fit for purpose. 

We advise companies to ask employees what they want in terms of communication. Tread carefully with surveys because even the keenest worker can get survey fatigue, but quarterly pulse surveys can raise engagement and help you keep across developments: What are we doing well? What could we do better? What other suggestions do you have? Have your circumstances changed the way you can access our communications? Could push notifications work? Or something else?

Nothing can beat going into the kitchen for a cup of tea and a chat with colleagues. If an employee has concerns about pay or their value to the company, it is very difficult to replicate that face-to-face contact. Failing that, employees simply need to feel they are still being listened to, especially since the advent of remote and hybrid working. The events of the last two years have brought not only new opportunities, but also new challenges for people which means a softer approach often works better, leaning on kindness, emotional intelligence and empathy. 

More insights from Lisa Trewhitt:

How can HR technology support your annual pay review process?

How joined-up HR tech can boost productivity

Pay Data: The right version of the truth?

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