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Employers get creative to reduce inflation

Inflation puts some employers in trouble: how to control costs and retain workers when rising prices eat away at their wages. Although wages have increased, they have not kept pace with inflation. And despite fears of an impending recession, the labor market is still quite tight.

A little over a year ago, St. Louis software developer Jeannie Lin took a new job, and a small pay cut, to do a job she felt was more meaningful: teaching programming to non-traditional students in a non-profit organization. Then inflation started to make that little pay cut seem bigger.

“I have children, I have a family of four to support,” Lin said. “And so the food costs, everything is a little tighter.”

So she was pleasantly surprised when she opened her company’s weekly email late last month.

“This one was talking about inflation issues,” she said. “There wasn’t a bunch of, like, ‘Let’s all talk – what would help you?’ It was just ‘Here, that’s what we do.’

The company gave all of its employees a bigger-than-expected annual raise and a one-time bonus to help them cope with rising costs.

“And I was like, ‘Wow! I should read these newsletters all the time,'” Lin said. “That’s great news.”

A recent survey by the Society for Human Resource Management found that around three-quarters of HR departments worry about the impact of inflation on their company’s workforce. We also saw big companies like Microsoft, Walmart and Exxon handing out mid-year pay raises this summer.

Jill Chapman, of HR services firm Insperity, said some employers had simply increased pay rises that usually come at the end of the year, hoping inflation would subside.

“They just flipped the schedule a bit,” she said. “Let’s go and help people now instead of waiting.”

But she noted that not all companies are able to raise wages permanently; many are themselves squeezed by inflation.

“If people really want to get smart and creative, you know, there’s a lot of perks you can offer,” Chapman said — things like extra paid time off, babysitting, or free lunches. One company even considered joining Costco.

Luke Pardue, an economist at Gusto — a payroll and benefits service for small businesses — said companies’ gas allowances on the platform have increased 30% over the past year.

“Despite much of this economic uncertainty, workers are still driving this job market,” he said.

Sectors offering gas allowances have also grown, he said – mainly from transport and logistics, where driving is central to work, to leisure and hospitality, where offers of employment are still high and employees generally cannot work remotely.

But these kinds of small gestures can get even smaller after taxes and can sometimes feel downright insulting if a company has overlooked bigger issues, said David Buckmaster, the author of “Fair Pay” and a former compensation analyst at Nike. and Starbucks.

“I remember a really big retailer who, you know, had a huge backlash because they launched a meditation app,” he said. “There was this whole response to say, ‘We didn’t want a meditation app, we wanted to be able to pay our rent. “”

For employees like Jeannie Lin, a simple message sometimes speaks louder.

“All the warm and fuzzy messages can’t be compared to ‘Hey, I know something that’s going to help – here’s some more money’,” Lin said with a laugh. “Thank you, that really helps me.” Again more, she said, because she didn’t have to ask.

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