Investment in skills and training to help build capability for businesses to cope with the impact of AI and automation is the top priority for HR teams going into 2024. But organisations say they still expect to deal with the impact of the cost-of-living crisis on employee performance in the first half of next year.
These are the key findings of our Edenred 2023 People Barometer 2023, an annual survey that asks HR leaders about the key issues shaping their priorities for the year ahead.
At the end of a year dominated by the cost-of-living crisis, nearly two thirds of employers (64%) said they were struggling to retain staff, a similar number (62%) reported falling levels of employee engagement, 39% were getting more requests for additional financial support and a third (33%) said their employees had taken up second jobs or side hustles.
Around half of all employers (48%) said financial wellbeing is the biggest threat to performance going into 2024 with virtually the same number (51%) saying it was the dominant people issue that they had to deal with in 2024.
Employers said that providing one-off vouchers or payments for cost-of-living support (68%) and increased pay (59%), access to an employee assistance scheme (42%) and retail discount schemes (34%) were the main measure they had put in place to help employees.
Half of employers (47%) say they will increase pay before the end of the year and a further 20% will provide one-off support payments.
While the majority of HR leaders (64%) said organisations had a duty to help employees with challenges such as the cost-of-living crisis, 54% said they had to compromise between the support they wanted to provide and their ability to afford it.
Looking ahead at priorities for 2024, preparing their organisation for the impact of AI and automation will be the top area for investment for 55% of HR teams with support for employee welling (43%) and investment in employee engagement (36%) close behind.
My personal view on this is that while the cost-of-living crisis is likely to ease in 2024 it is clear that the top priority for every employer is to recognise the ongoing impact it will have on employee engagement, performance and retention. Whether you are planning a year to consolidate or change the business, high performance will be critical to success and supporting employees with financial concerns will be critical to achieve business goals. Start by reviewing the support you have in place to drive financial wellbeing, engagement and performance. Does it align with the way the business works or do you need to make changes? Does it use incentives to reinforce company values and encourage behaviour that underpins business success? Our new ebook, Land a strong finish to this year and get a fast start to 2024, provides you with more practical solutions to fix the employee performance gap.
