The real living wage increase paid by more than 11,000 UK businesses of over 10% in November of last year is set to have a large impact upon the economy as a whole.
It is estimated that paying a quarter of low paid workers the real living wage will unleash a boost in region of 1.7 billion into the UK Economy. Whilst the initial obvious impact is on organisations ability to deliver services and meet the added demands of the real living wage, a secondary impact of the cost-of-living crises cannot be ignored.
UK inflation currently at over 9%, is not being matched by pay awards and is unlikely to be affordable for many organisations in the forthcoming April reviews.
The implementation of both the minimum and real living wage is leaving organisations with the prospect of reducing the differential between grades at the lower end of wage structures.
The “concertinaing” of pay structures could lead organisations to recruitment and retention difficulties at a critical time when organisation need to keep and attract the employee expertise to drive business and services forward in economic uncertainty.
The questions organisations need to ask themselves is; how can we provide services, retain and attract front line delivery employees, and maintain the balance within existing pay structures?
If your answer is “not sure” to this fast approaching conundrum then it may be advisable to give us a call to chat through your requirements and how we could help you.
We’re here to support you and your organisation both now and in the long term. To find out more contact us.
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