Article

Inflation's Hurting Your Team. Here's How to Help.

What SMBs Can Do to Help Their Employees With Rising Inflation (Without Raising Salaries)

April 11, 2022

Jump to a section
Share it!
Sign up for our newsletter
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
This is some text inside of a div block.

Inflation can make running your business tough. And not just because you have to deal with rising prices.

In case you missed it, the U.S. rate of inflation is the highest it’s been in about 40 years. In February, the consumer price index rose 7.9% compared to the previous 12 months, and now we’re seeing rising prices for gas, raw materials, and other goods and services.

And when it comes to your business, you’ve probably already experienced the hardships that come with inflation. You may have had to deal with the rising cost of the materials you need or had to raise your own prices.

Unfortunately, you’re not the only person in your business who’s suffering the fallout of inflation.

Your employees have their own struggles with it. Because prices are rising for just about everything, the cost-of-living is also increasing. But wages aren’t matching up. According to the Bureau of Labor Statistics, civilian wages and salaries only increased 4.5% in 2021 — much lower than the rate of inflation.

While your employees may deserve the compensation to help them beat inflation, it might not be a viable option for your business. Some businesses have already had to raise their salary offerings due to the high demand for labor. Plus, 45% of businesses haven’t factored inflation into their salary budgets.

You don’t want to lose people because of inflation. The good news is that there are some ways to help your employees deal with rising prices beyond raising their salaries. Here’s how:

Be transparent about how inflation is affecting the business.

Two of your best tools for this period of inflation are honesty and transparency. Whether it’s at your team meeting, through email, or on Slack, you want to be open about how your business is dealing with inflation and what that means for employee compensation.

Share how your business is offsetting costs, whether that’s through raising prices or locking in long-term supply chain deals. If there isn’t a way to increase everyone’s base pay right now, be upfront about the situation. But you’ll also want to outline a plan for what a raise might look like in the future.

Staying silent will only give your employees the opportunity to assume the worst. And the last thing you want is to be accused of greed when you’re looking for ways to help your team.

Find out where your employees are hurting most.

When you open up communications with your employees about inflation, you should also find out which costs are affecting them most.

Rising gas prices are hitting consumers especially hard — if you’ve been considering making remote or hybrid work part of your business, now is the time. And if your business requires in-person attendance, try arranging a company carpool or give out gas cards to your team.

A recent inflation-fueled trend called “lunchflation” is exactly as it sounds: an increase in lunch prices because of rising costs in food and labor. Restaurant prices are up 6.8% compared to last year; plus, grocery prices are up 8.6%. It may be a small gesture, but a weekly paid lunch might ease some of your employees’ food costs.

Bonuses and benefits are your friends.

You want to get creative about ways you can help your team. If you can’t raise salaries, consider if there’s room in your budget for one-time bonuses to assist with the immediate effects of inflation.

You can also plan to introduce benefits that will help you and your employees. For example, employee benefit programs like tuition repayment and child-care assistance are tax-deductible for businesses. They’ll help lift a burden for your employees while also being beneficial for your business.

Inflation is creating a lot of difficulties for your business and your employees. While you may not have the funds to increase salaries and combat rising prices, you can still support your team.

Share it!
Sign up for our newsletter
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Article

Inflation's Hurting Your Team. Here's How to Help.

What SMBs Can Do to Help Their Employees With Rising Inflation (Without Raising Salaries)

April 11, 2022

Jump to a section
Share it!
Sign up for our newsletter
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

Inflation can make running your business tough. And not just because you have to deal with rising prices.

In case you missed it, the U.S. rate of inflation is the highest it’s been in about 40 years. In February, the consumer price index rose 7.9% compared to the previous 12 months, and now we’re seeing rising prices for gas, raw materials, and other goods and services.

And when it comes to your business, you’ve probably already experienced the hardships that come with inflation. You may have had to deal with the rising cost of the materials you need or had to raise your own prices.

Unfortunately, you’re not the only person in your business who’s suffering the fallout of inflation.

Your employees have their own struggles with it. Because prices are rising for just about everything, the cost-of-living is also increasing. But wages aren’t matching up. According to the Bureau of Labor Statistics, civilian wages and salaries only increased 4.5% in 2021 — much lower than the rate of inflation.

While your employees may deserve the compensation to help them beat inflation, it might not be a viable option for your business. Some businesses have already had to raise their salary offerings due to the high demand for labor. Plus, 45% of businesses haven’t factored inflation into their salary budgets.

You don’t want to lose people because of inflation. The good news is that there are some ways to help your employees deal with rising prices beyond raising their salaries. Here’s how:

Be transparent about how inflation is affecting the business.

Two of your best tools for this period of inflation are honesty and transparency. Whether it’s at your team meeting, through email, or on Slack, you want to be open about how your business is dealing with inflation and what that means for employee compensation.

Share how your business is offsetting costs, whether that’s through raising prices or locking in long-term supply chain deals. If there isn’t a way to increase everyone’s base pay right now, be upfront about the situation. But you’ll also want to outline a plan for what a raise might look like in the future.

Staying silent will only give your employees the opportunity to assume the worst. And the last thing you want is to be accused of greed when you’re looking for ways to help your team.

Find out where your employees are hurting most.

When you open up communications with your employees about inflation, you should also find out which costs are affecting them most.

Rising gas prices are hitting consumers especially hard — if you’ve been considering making remote or hybrid work part of your business, now is the time. And if your business requires in-person attendance, try arranging a company carpool or give out gas cards to your team.

A recent inflation-fueled trend called “lunchflation” is exactly as it sounds: an increase in lunch prices because of rising costs in food and labor. Restaurant prices are up 6.8% compared to last year; plus, grocery prices are up 8.6%. It may be a small gesture, but a weekly paid lunch might ease some of your employees’ food costs.

Bonuses and benefits are your friends.

You want to get creative about ways you can help your team. If you can’t raise salaries, consider if there’s room in your budget for one-time bonuses to assist with the immediate effects of inflation.

You can also plan to introduce benefits that will help you and your employees. For example, employee benefit programs like tuition repayment and child-care assistance are tax-deductible for businesses. They’ll help lift a burden for your employees while also being beneficial for your business.

Inflation is creating a lot of difficulties for your business and your employees. While you may not have the funds to increase salaries and combat rising prices, you can still support your team.

Article

Inflation's Hurting Your Team. Here's How to Help.

What SMBs Can Do to Help Their Employees With Rising Inflation (Without Raising Salaries)

April 11, 2022

S
E

Organize the chaos
of your small business

No items found.
No items found.