How To Help Your Employees Navigate High Inflation

The soaring cost of living is putting a serious strain on employees everywhere, and the impact is rippling through businesses. Inflation-driven stress is putting employers at risk of losing their people. So, what can you do as an employer to retain your talent and minimize the exodus? Here are strategies to help your team weather the storm of inflation while strengthening loyalty and engagement at work: 

Key Actions to Counteract Inflation-Driven Attrition 

Re-Evaluate Compensation Structures:  

Increasing salaries during uncertain economic times can feel counterintuitive. But if your employees’ wages aren’t keeping pace with the rising cost of living, it’s likely that their financial well-being and morale will drop. 

As a result, keeping compensation relative to rising inflation can be a competitive advantage helping you attract and retain talent, as well as offering a boost to productivity.  

If your company can’t immediately implement longer-term compensation increases, you can offer inflation-focused bonuses as a short-term measure. These can send a powerful signal that you care about your team. (We suggest you start planning your compensation if you want to remain competitive in the future.) 

Adopt a Flexibility-First Mindset. 

Consider other measures your company could introduce to reduce your employees’ financial burdens. For instance, remote or hybrid arrangements can reduce employee commuting expenses, while flexible schedules or compressed workweeks can ease the burden of childcare and other home economic challenges. You could also consider partnering with local businesses to secure group discounts to reduce the cost of living for your team.  

Champion Financial Literacy and Financial Wellness. 

Partner with financial experts to deliver targeted workshops addressing inflation-specific concerns such as budgeting, debt management, and strategic saving and investing. Access to such resources empowers employees to make informed financial decisions and bolsters their sense of security. It also shows your team you understand their struggles and want to help them make confident choices. 

Mental Health as a Business Imperative.  

Economic stress is a direct psychological threat to employee well-being. To improve employee outcomes during stressful times (like periods of high inflation), you can:  

• Ensure your Employee Assistance Program (EAP) offers robust support specifically tailored to manage inflation-related anxiety.  
• Destigmatize mental health discussions, encouraging the use of mental health-focused benefits and reinforcing a culture of support. 

• Consider subsidizing mindfulness apps, online stress-reduction courses, or access to local meditation/yoga programs. These tools build resilience against anxiety. 
• Provide mandatory training for managers on spotting signs of financial-related burnout, how to have sensitive conversations, and when to guide employees to EAP resources. 

The Bottom Line 

Inflation is a reality employers must address to retain top talent. Remember, it’s not just about the paycheck, you should consider looking at inflation (and the associated stress) holistically. While pay increases and reducing the cost of living or the burden of work can help, it’s important to build a workplace centered on understanding, support, and tangible solutions. Ultimately, this investment will extend well beyond a volatile economic period. 

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