Festival of Work 2023: Supporting employees through the cost-of-living crisis

The Festival of Work returned to London’s historic Olympia this month, and it was bigger, bolder and brighter than ever before. In fact, the queue just to get in snaked all the way into the borough of Kensington!

The main exhibition floor was packed to the rafters with the best HR and learning technology on the market, and this included a team from Cezanne HR. Our team of HR software product experts spent the day demonstrating the Cezanne HR system in all its glory, and taking in the sights and sounds of this ever-popular event.

This year saw a big shake up in how talks and seminars were delivered. Along with the usual throng of light and bright supplier stands, this year, the main exhibition floor was dominated by a huge festival stage, where many insightful talks and seminars took place throughout the day.

Perhaps the biggest draw, though, was the opening keynote speech with television presenter Fearne Cotton. Her talk, in which she spoke candidly about the importance of self-care and setting boundaries, was made in front of a huge audience.

She discussed her own personal battles with anxiety, and spoke with some passion about how we all shouldn’t fear mistakes or challenging times. This is because building personal resilience will always be the bi-product of difficult times, and can ultimately help make us all stronger.

She closed her talk by saying that, in her opinion, a good life is a challenging one. In addition, she believes that a huge part of healthy wellbeing is taking time out to be selective of things that make you happy, and not being too hard or critical of yourself. Wise words indeed.

Her opening keynote certainly gave everyone food for thought. However, her talk was just one of many going on throughout the day – and there was one in particular that piqued my own interest…

Trends and solutions: a data-led approach to supporting employees through a cost-of-living crisis

Taking place on the first floor of the exhibition, Vicky McNab, Product Director at data analytics and consumer credit reporting company Experian, delivered an insightful talk on how data can be used to better support employees during the cost-of-living crisis.

She opened her talk by stating that businesses will – whether they mean to or not – actively affect their employees’ household finances, and there’s a few reasons why.

Firstly, employers will affect their employees’ finances through what benefits they’re offered, their wages, where they complete their duties or even their standard working hours. Secondly, it’s also the case that over the past 3-4 years, the employer-employee relationship has significantly changed. Employees are looking to employers to help them navigate tough financial conditions, and this isn’t just in the form of being paid more.

Thirdly, increased diversity across the workforce will also be a factor. This is because everyone has different aspirations and different needs, meaning not all renumeration packages or business perks will suit everyone.

With those factors at play, it’s now become increasingly difficult for employers to make intelligent decisions when it comes to building successful wellbeing strategies.

Why employers can’t afford to ignore the financial wellbeing of employees

Vicky went onto say that, although wellbeing strategies are not often considered urgent business priorities, the current financial crisis should put financial wellbeing top of HR’s agenda – and with good reason. This is because:

• Three quarters of people have cut back their spending, and it’s not just those on lower incomes – in fact, it’s primarily middle earners
• 44% of people have used savings to make ends meet
• 49% of people couldn’t afford to make an emergency payment of more than £300, such as needing a plumber or fixing a broken down car
• 26% of people have used credit just to fund normal monthly payments, and this is apparently increasing

In addition, Vicky revealed that data from Equifax showed there were over a million more credit cards with a balance on them compared to a year ago. But, despite many people now experiencing financial concerns or hardship (and the data proving this), Experian’s research also discovered that:

• 52% of UK adults don’t feel comfortable talking about money
• 30% of UK adults have low knowledge of financial matters
• 39% of UK employees are experiencing higher levels of anxiety about finances since the COVID-19 pandemic.

Although a person’s financial circumstances are – understandably – private matters, all these factors will, in turn, present challenges to how recruiters and employers engage with employees – and Vicky believes organisations must be prepared.

Creating effective financial wellbeing strategies: diagnosis is key

With many in the UK battling extraordinary financial conditions, Vicky stated it was in every organisation’s interest to have robust wellbeing strategies in place for their staff. But, these can be incredibly expensive, both from a time and monetary perspective. So, it’s vital that employers look to get them ‘right first time’ to ensure they are valued and engaged with by employees.

To create an effective financial wellbeing strategy, Vicky recommends employers and their HR teams focus on diagnosis. In other words, what – in the wider world and within your organisation – lies ahead for employees and their finances that could impact your business? Vicky recommended asking these 5 questions:

• What’s the complete picture? Try to get a better understanding of the overall financial picture for your employees, and the factors that can affect their day-to-day lives
• Do we understand how macroeconomics could impact employees? How is the economy of the UK doing, and what are the best forecasts predicting for the immediate future and longer term?
• Are there any regional considerations? Are their regional financial trends – for example, ‘London prices’ – that could have an impact on employee financial wellbeing?
• Are there any organisational trends? Are there any contributing factors within your business that could impact your employees’ financial wellbeing? For example, if your business found the biggest expenses for employees outside of normal household bills were travel costs, would that dictate your financial wellbeing strategy?
• Do we have any cohort-level insights? Do specific groups of employees feel financial impacts more readily?

Vicky stated that answering these 5 questions is key to detecting whether employees could be under pressure financially. The answers will then, in turn, help support more effective – and preventative – financial wellbeing strategies.

How best to engage with employees when it comes to financial wellbeing

Vicky closed her talk by stating that, although there are green shoots of recovery, the cost-of-living crisis is not going to disappear overnight.

It’s going to be affecting all of us for years to come as certain impacts won’t be felt now. For example, fixed mortgage deals coming to an end in 18-24 months’ time will likely be impacted by much higher interest rates than today, and this could lead to a secondary economic shock. This is why it’s vital employers get their houses in order when it comes to their financial wellbeing strategies.

However, Vicky stressed that employers can’t veer into offering financial advice. They do, though, have a duty of care to their employees. So, as part of any wider strategy, employers could look to provide guidance on how to better understand payslips – a common financial touchpoint for employees – or look to providing tools and resources to improve financial literacy.

Vicky added that from an HR perspective, meaningful engagement around financial wellbeing can be nurtured through HR portals and shared workspaces. This is because learning resources and communications can be easily shared across a business, and made easily accessible by everyone, too.

In addition, Vicky believes that employee pulse surveys are something that shouldn’t be forgotten. Pulse surveys are incredibly quick, easy and timely methods of collecting the vital employee data that will help guide more strategic decision making. Plus, if contributors can give information anonymously, they’ll be more likely to give honest assessments that HR can use to benefit an entire organisation.