Responding to the latest labour market statistics from the Office for National Statistics (ONS), John Pearce, SVP Payroll Operations at CloudPay, has warned that pay inflation rates are unsustainable.
He said that there needs to be additional help to be put in place as people are struggling with the cost of living crisis, but warned pay increases will not be sustainable for everyone.
Pearce said, “With the cost of living still increasing and inflation rates remaining stubbornly high, pay increases aren’t going to be sustainable for all. We believe a balance needs to be struck where employees are paid fairly, but are also given access to benefits and financial education or advice that provides more than pay support.
“It’s clear that people are struggling to make their wages go further and there needs to be additional help in place – that is driven by employers – to enable them to access tailored financial advice during these difficult times. Providing flexible pay solutions that will support those who have unexpected costs before pay day will also keep people clear of costly loans that will only worsen their financial situation.
“Pay inflation can’t be the only solution to the economic challenges that today’s workforce is facing. Businesses need a smarter approach, and that includes flexibility around pay and financial education.”