As many as 6.5 million UK workers could quit their current job this year for a higher-paying one, as the cost-of-living crisis deepens.

As ‘Awful April’ approaches, and food costs, council tax, broadband and water bills are all set to rise further, research shows that one in five employees are looking for a new and higher-paying job.

Personal finance experts at Claro Wellbeing are predicting a flurry of resignation letters this April, as further pressure to find a higher-paying job is increased by people’s pay packets

“Inflation and rising interest rates are placing extra strain on budgets, leading people to search for better paying roles. The financial stress the cost-of-living crisis is putting on millions has been shown to affect productivity at work, lead to more sick days, and negatively affect our mental health and overall wellbeing”, says Stacey Lowman, Head of Employee Wellbeing at Claro Wellbeing.

What costs are rising?

The end of the Energy Bill Support Scheme means households will no longer receive the £67 monthly support payment from the government and water bills will rise by 7.5 percent or around £31 per household per year in April.

Millions will see council tax rise by up to 5 percent pushing annual bills beyond £2,000 for many households. And the price of staples like stamps will rise 16 percent exceeding £1 for the first time ever. Prescriptions too are also increasing by 3.2 percent moving closer to the £10 mark, and pushing Brits further into the red. 

People have two choices to curb the cost-of-living 

Stacey continued: “Most people have two choices when they face financial pressure – make lifestyle cutbacks where they can or to find a way to increase their income. With the cost-of-living continuing to rise, cutbacks can seem unfeasible to many that have already made changes to their spending. Instead, our research shows that one in five people will look for a better paid job.

“People may also choose to take up additional work, such as a side-hustle or part-time job, but this requires more time and energy on top of existing commitments. It also risks negatively affecting mental health and making people less focused and less productive in both roles. Therefore, for many people, finding a higher-paid job is more viable. 

“Whatsmore, those employees that stay and choose to weather the storm are likely to be burdened with an increased workload, at least in the short term, as their workplace finds a replacement adding to their existing woes.”

Claro Wellbeing’s research shows an intrinsic link between money and mental health, with two-thirds (67%) of staff saying that money worries affect their work. In addition, employees spend an average of 3.5 working days a year managing finances while at work, sapping productivity.

Employers are struggling too

Stacey continued: “With inflation increasing business overheads too, it’s unlikely that employers can continue to award pay rises. There are other actions businesses can take to provide support to employees who may be struggling and help them hold onto valuable staff.

 “We’ve seen some businesses give one-off bonuses to staff in an effort to combat the impact of rising costs and whilst this can ease the pressure in the short-term, long-term provisions will better support staff. This might include the introduction of a financial wellbeing programme to help employees to better manage their money, develop a smart money mindset and make confident financial decisions. Other forms of financial support could include offering access to financial coaching, discounts and rewards schemes and spreading out bonuses over an extended period of time to help with budgeting.  

“With ‘Awful April’ placing further pressure on employee finances, employers have a role to play in supporting staff. Claro Wellbeing’s research shows that 69 percent of employees think their employer should do more to support their personal finances and 81 percent say that a financial wellbeing programme would increase their satisfaction. When pay rises are not a possibility, businesses must consider which steps they can take to provide meaningful alternative support amidst ongoing challenges.”

 

 

 

 

Amelia Brand
Amelia Brand

Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.