Pay with purpose: 4 ways to empower your workforce strategically
As inflation rates rise and the UK economy faces unprecedented challenges, organisations must rethink their approach to pay and retention. Sarah Jefferys, head of reward and benefits consulting at Gallagher, offers some top tips on how to build a competitive pay strategy in a challenging environment
In 2023, everyone is feeling the squeeze. Britain is set to have one of the highest inflation rates in the G20 this year, according to forecasts from the Organisation for Economic Co-operation and Development (OECD). And with the UK economy not having seen anything like this since the 1970s, many people will have never experienced such increases in their working lives.
In times of economic uncertainty, it is all too easy for organisations to slam the brakes on, looking for any opportunity to cut discretionary spend, often in people-related areas. But, warns Sarah Jefferys, head of reward and benefits consulting at Gallagher, doing so is both short-sighted and risky when it comes to retaining talent. “In knowledge-based organisations where people are both your main expense and the secret to your success, that is not where you should stop spending,” she says. “It’s about spending it more wisely.”
As salaries continue to climb – the ONS predicts average salary inflation will sit between 4% and 7% this year – reward teams need to ensure people-related costs are well understood, managed and invested for maximum value. Here, Jefferys offers advice on how to build a competitive pay strategy in a challenging environment.To access please sign in.