There is a lot of talk about how the cost of living is affecting the operation, planning and spending policy of companies, but how is it affecting the culture? In a context of financial uncertainty like the current one, the latest Pleo study reveals that 93% of Spanish companies are seeing their company culture affected by the increase in the cost of living. Being the workplace the most affected element, 31% admit that they have had to change location to a more affordable or remote location or even to a shared office.
The report “The state of business spending in 2023” shows that employers have been forced to make difficult decisions in the last six months and that most have had to cut some expenses in 2023 to maintain the health of your company. One in three has had to freeze benefits for employees such as health insurance or travel allowances, 30% have cut premiums and the same percentage have frozen the budget for social gatherings.
The study also reveals that the number one priority of managers in Spain is to guarantee the jobs of their employees, and they are adjusting their budgets accordingly. Nearly half (46%) of companies are modifying the way to reward the staff, trading benefits, gifts, social activities for what employees really want: a better salary, training or travel expenses.
When it comes to the workplace, the survey results confirm that a third (34%) of employees requested to continue teleworking. One of the main reasons cited is the high overall cost of travel (33%), which puts enormous pressure on team leaders trying to combat the growing problem of worker disconnection.
In addition, the report reflects how inflation is forcing employees to request additional aid from their employers to cope with the growing pressure on their financial health. 38% of the surveyed companies received salary increase requests from your employees, a third (33%) requests for advance payment of the payroll and more than a quarter (30%) refusals by employees to advance money out of pocket to pay company expenses.
Alvaro Dexeus, Pleo’s director for southern Europe, states: “In recent years, we have seen how the world of work has faced great challenges. First the pandemic, which imposed teleworking almost overnight, and now the obstacles derived from the increase in the cost of living and the current financial uncertainty. Our research has shown that company culture is one of the biggest victims of the cost of living crisis.
“But difficult times bring with them opportunities that companies can take advantage of. It is encouraging to see that the number one priority of managers in Spain is guarantee the jobs of its employees. For this reason, I encourage company managers to invest time in creating a flexible and supportive company culture, which offers its employees what they need, even when the economic situation is not so favorable. In these uncertain times, greater visibility on spending, for example, will help strengthen ties between employers and employees.
“In addition, companies should consider what they can do to help alleviate individual financial hardships for their employees. With nearly a third of the workforce cash-strapped, shorter pay cycles and smart spending cards to avoid out-of-pocket costs have never been more important.” concluded.
