August 10, 2022

Nearly Half of UK SMEs Have Not Raised Wages in Line with Inflation

inflation

A brand new survey amongst 402 decision-makers inside UK small and medium enterprises (SMEs) has revealed the biggest challenges for UK companies within the new monetary yr. It discovered that: 

  • Nearly half (46%) of determination makers inside UK SMEs declare their enterprise has not raised their wages according to inflation
  • Nonetheless, 57% declare their enterprise has raised the costs of their items or costs according to inflation
  • 73% contemplate points with employees retention a risk to their organisation

Nearly three-quarters of UK SMEs are struggling to maintain maintain of their workforce, in accordance with new analysis from NerdWallet. 

The monetary comparability web site surveyed 402 decision-makers inside UK SMEs. It discovered that nearly half (46%) of SME enterprise leaders haven’t raised worker salaries according to inflation.

Nonetheless, 57% of decision-makers declare their enterprise have raised the costs of products and providers. 

Nearly three quarters (73%) are presently claiming employees retention to be a problem to their organisation; 1 / 4 (25%) declare this poses a ‘main’ risk to their organisation.

70% of SME enterprise leaders said that difficulties in recruiting new workers pose a significant risk to their enterprise. Multiple in 4 (26%) contemplate recruitment points to pose a significant risk to their enterprise.  This comes because the (52%) of SME decision-makers declare to be actively trying to recruit new members of employees.

Connor Campbell, Private Finance Professional, at NerdWallet mentioned: “UK SMEs have been compelled to make troublesome choices over the earlier two years – and skyrocketing inflation has solely difficult issues.

“Making certain that each one wages are raised according to inflation – which presently sits at a thirty-year excessive of seven% – could appear to be a attainable process for SMEs, given the monetary stress they’re already dealing with. Nonetheless, this may be a key driver of mass-resignations inside UK companies. In any case, workers may even be experiencing strained budgets and as such, really feel that they’ve little alternative however to resign in seek for a better wage.

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“As such, employers should prioritise open and sincere communication with their workers. Explaining how present financial circumstances are impacting the organisation, and the actions they plan to take to make sure that their workforce don’t really feel their wants are being ignored. After all, business-owners can not cease workers from leaving the enterprise; however such conversations may actually assist to place their groups thoughts relaxed and minimise potential disruption pushed by resignations.”

Notes to Editors

About NerdWallet UK 

NerdWallet is on a mission to supply readability for all of life’s monetary choices. As an unbiased monetary comparability web site, NerdWallet gives shoppers and companies with helpful instruments and insights to allow them to make sensible cash strikes. From selecting a checking account or breakdown cowl to purchasing a home, NerdWallet is there to assist people make monetary choices with confidence. Customers have free entry to our comparability tables and skilled content material, to assist them keep on prime of their funds and save money and time, giving them the liberty to do extra. For extra data, go to NerdWallet.com/uk/.  NerdWallet Ltd is an organization registered in England and Wales and a wholly-owned subsidiary of NerdWallet Inc. All rights reserved. Different names and logos used herein could also be logos of their respective homeowners. 

Concerning the analysis

 The market analysis was carried out between fifteenth and twenty first March amongst 402 UK adults through a web-based survey by unbiased market analysis company Opinium. Opinium is a member of the Market Analysis Society (MRS) Firm Associate Service, whose code of conduct and high quality dedication it strictly adheres to. Its MRS membership implies that it adheres to strict tips concerning all phases of analysis, together with analysis design and knowledge assortment; speaking with respondents; conducting fieldwork; evaluation and reporting; knowledge storage. The 402 respondents had been all decision-makers and managers inside UK companies. 

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