Are pay raises the answer to labour shortage?

More than one-third of workers looking for salary boosts, according to report

Are pay raises the answer to labour shortage?

About 43 per cent of workers around the world will be looking for new jobs within the year, found a new report from consultancy firm EY.

Why? More cash is now the most important consideration amid record inflation, with 35 per cent looking for an increase to their salaries.

This boost in compensation is the best way to address the great resignation, say 42 per cent of employees. However, only 18 per cent of employers agree with that sentiment.

“As employers have increasingly provided flexible work approaches, higher pay is now the biggest motivation for changing jobs, particularly given rising inflation and available unfilled roles,” says Liz Fealy, EY global people advisory services deputy leader and workforce advisory leader.

More than one-third (36 per cent) of workers say they will look for a new job with higher pay, according to another survey.

Fewer job seekers are looking for remote-work flexibility (19 per cent) and well-being programs (17 per cent), found EY’s survey of more than 1,500 business leaders and more than 17,000 employees across 22 countries in January and March.

Employers are also offering more flexibility to workers, with only 22 per cent saying they want employees to come back to the office five days a week. This is good, considering that most employees (80 per cent) say they want to work remotely at least two days per week.

But money is still a big thing, says Roselyn Feinsod, EY Work Reimagined leader. “We are seeing a top third of companies successfully navigating these divergent positions on pay, career opportunities and flexibility. They have moved from ‘resistance’ to ‘renaissance’ and that’s a win-win for their companies and their workforce. Organizations have to work to retain their employees, instill trust and provide a package that takes into account total pay, career path and flexibility to balance market concerns and risks.”