Businesses are under financial pressure as a result of the continued increase in costs for products and rising energy bills.
In addition the increase in company national insurance contributions means that businesses have taken an additional hit in relation to the cost of employing people.
In a recent report, Personnel Today, the research conducted shows that 65% of HR leaders are provided with less budget for 2025. With the shrinking budgets HR teams face the dilemma on where they can cut costs.
Areas for HR to consider
- Review benefit packages- are the programmes that the company offers being taken up or can they be consolidated?*
- Recruitment- look at how the company recruits new starters, are the channels used successful? Recruiting can be costly and in particular where the employees fail to meet the standards expected in probation.
- Training and development- focusing on internal talent to up-skill these employees to ensure that the company has highly performing people. The return on employees learning and developing new skills enables the business to streamline processes, and improve performance.
- Negotiating with current suppliers e.g. benefits providers , recruitment agencies , training providers , may be an option, and in some circumstances there may be an alternative option that suits both parties.
*HR should consider the impacts of any changes to their benefits schemes, as there may be employment implications where varying any contractual benefits.
Employee engagement is key in achieving sustained business success. Whilst change is required to maintain the competitive edge within the business, balancing cost continues to be a challenge.
For further advice and guidance on how to implement change in the business, reach out to our team of HR Consultants for a free initial consultation call on 0345 646 0406 or fill in our online enquiry form and we will be in touch.