The Cost of Living Crisis – Part 1

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There is so much concern amongst both front-line staff, managers, and all our customers, about the rising cost of living, and the increasing difficulties of making ends meet.

In the first part of this Editorial series, we explore what this means for the contact centre and customer service sector, both for the customers and our people, the effect it is having, and will continue to have, on our People and Customers, and what can Employers do to support, with a range of views from those running operations, and those supporting people and vulnerable customers. 

What are the challenges for Contact Centres?

“The cost of living crisis is having a widespread impact on people in the UK. As bills soar and inflation impacts food prices, many are facing difficult choices between essential necessities that they should never have to make.

This is impacting contact centre employees both in the workplace and in their personal lives. Those in the utilities sector are dealing with extremely high call volumes and increasingly distressed customers. Outside of work, these same employees are also struggling to make ends meet.” says Janine Hunt, Client Partnership Director at Kura.

“The cost of living crisis is having a massive effect on contact centre workers both personally and professionally. At the same time as dealing with customers who are experiencing financial hardship, many are spending their personal time fretting about making ends meet themselves. While businesses are also feeling the squeeze of inflation, they should be looking after their people.”

“We continue to face challenges as employers with the cost of living crisis and the impact that this is having on our employees and our customers. Over recent months we have all experienced significant increases to our energy, food, and travel costs. This is not only a financial concern but is impacting on how we are feeling both at work and at home.” says Jo Regan-Iles, Chief People Officer at Ventrica.

“With additional financial pressures for many employees who may be on the National minimum wage, employers need to have a clear communication strategy, as in many sectors they will have increased financial demands from supply chain costs, ongoing real estate costs, potential loss of revenue from contracts that may have reduced in call volumes or terminated. It is not always easy to be able to increase costs especially as we are finding our way out of the pandemic. It has been a very tough two years for everyone.

As an industry we also need to continue to look at how we can improve the customer journey and experience by introducing more automation and have the ability to be able to deal with more customer contact, especially during a surge in contacts, as an example with energy bills”.

What may be the impact on Retention and Attrition?

“The UK’s Office for National Statistics said the cost of living is increasing at its fastest rate in 30 years. Energy bills in the UK are expected to rise by an average 50% this year and as a result, higher pay has now taken up the main motivation for changing jobs, however this is against a backdrop of many employers already providing flexible work approaches. says Francesca Randle, Director at Cactus.

In a recent survey by EY, (their 2022 Work Reimagined Survey), their findings reveal that 43% of employees are likely to quit their jobs, motivated by higher salaries, better career opportunities, and increased flexibility. 42% of employees surveyed also believe that pay increases will address high staff turnover, however, unsurprisingly only 18% of employers agree with this statement! 

Interestingly last year’s survey found that flexible working was the biggest driver in employee moves. However, with many companies now offering some flexibility, remote work is less of a factor, at 19%. So, unsurprisingly money is a huge motivator and driving factor in employees’ decisions to leave their current employer and be attracted to new opportunities elsewhere.

Organisations have to work harder than ever to retain their employees, instil trust and ensure that they are providing a package that takes into account total pay, career path and flexibility to balance market concerns and risks. In the Contact Centre industry this is a huge challenge with many employees working for minimum wage, in what can often be described as highly pressurised and demanding environments.” 

“Understanding of data is key for an Employer to determine why Employees are leaving or considering leaving and also how Employees are feeling, a clear and consistent strategy including regular employee surveys with feedback and actions plans can ensure that Employees have the opportunity share feedback,” says Jo.

“Once data can be analysed, the insight will be key in determining how an employer can offer support to employees during these uncertain times, it is important that all employees are understood as individuals and will all have different areas of challenge or concern. 

A review of your ‘Employee Value Proposition’ to attract new colleagues and retain existing employees by finding out what is important to them, additional holiday, increases sick pay, enhanced maternity pay, private medical insurance, career progression, flexible working patterns (with the increase in energy costs do employees now want to work in the office due to more expensive energy bills).

For employers who are unable to increase salaries, then looking at other ways to retain employees is key to avoid exit and retraining costs and loss of knowledge, which then impacts the customer experience. Salary is not always the key driver. It is essential to understand the data.”  

What impact is this having on Wellbeing?

“Line Managers play a key role in supporting their team members to notice any change in behaviour and being trained to be able to use external resources to support team members. Many organisations have also introduced Wellbeing Programmes which can offer support including Employee Assistance Programmes, Mental Health First Aiders,” says Jo.

“Employees need to feel that they are being supported and that if they need to be able to change their hours to help with childcare costs , have a hybrid working pattern to reduce the need to pay for travel costs or work additional hours if they can these are all options that can be individually tailored but we have to know how we can support , making our own assumptions is not going to help with this crisis.

“If advisors are dealing with more difficult conversations on a day-to-day basis, this can easily affect their emotional well-being and mental health. Customer service jobs are already the third most stressful in comparison to other occupational groups, so this added stress will undoubtedly have an impact. 

It is important to have support channels available in the workplace, such as designated points of contact, mental health first-aiders, or managers who are trained in emotional support. Professional support that employees can seek outside of the office will also be hugely beneficial.”

Janine from Kura also has thoughts on the topic: “At Kura, we have partnered with PAM Assist, an employee assistance programme that allows our people to seek professional mental health support 24/7. While we recognise that managers should have the skills to aid their struggling team members, we also understand that not everyone is comfortable talking about their mental wellbeing in a work setting. Trained counsellors can offer professional advice to anyone struggling to deal with these extra pressures.
 
An added benefit of an employee assistance programme is that it comes at no cost to our people, which helps to ease the cost of living burden on their personal lives. With high waiting lists for NHS mental health support, many people are being pushed into costly private care. This isn’t the case for Kura employees”.  

How is this affecting Customer behaviour?

Jo at Ventrica has a few thoughts about this: “Our Customers who are calling into our contact centres are also experiencing these changes which can result in our employees dealing with more distressed, emotional, and vulnerable customers. If we imagine how the increase in calls and the nature of enquiries can impact the day for our employees who want to be empathetic and support our customers, on some occasions they have significant call volume increases whilst themselves feeling external pressures.”

“During difficult times, your frontline advisors are going to be dealing with more emotionally charged customers. Some may be in distress over their finances, while others could be angry at your business or client for raising their prices,” says Janine.

“Advisors should be given the training and tools necessary to effectively help those customers – whether it’s providing compassionate support or de-escalating a heated situation. Empathy will be a key skill whether a customer is upset, agitated, or full-blown furious, so equipping your advisors with these essential communication skills will allow them to handle these conversations effectively.”

How do we support our people?

“Despite a cost of living crisis and a large proportion of contact centre workers on lower wages, 48% of businesses aren’t planning on pay rises to help employees mitigate the effects of rising costs. While increased pay would certainly help people to manage the cost of living rise, and businesses that can afford it should absolutely lead by example and implement it, there are ways you can assist employees financially if you don’t have the budget for pay rises”. says Janine

“Benefits packages that offer employees discounts on important everyday essentials can help them to ease the burden of paying for basic necessities. Some benefits providers allow people to cut costs on essentials including groceries and household appliances, making these important purchases less burdensome.

A lot of these packages also offer discounts and freebies on recreational products and activities. After all, people can’t be expected to just make ends meet enough to survive – they also need to thrive. Free cinema tickets, gym memberships, and more can allow your people to enjoy their downtime, even if the purse strings are especially tight”.

”What can be done to support the ‘cost of living crisis’ when considering employee wellbeing, differing working practices and hybrid working models?”, says Francesca.

“When staff work in an office, for example, they are not paying to heat their homes during the day, while food is often subsidised or even free in workplace restaurants. For those who live close to their work and do not commute long distances, returning to their office could make financial sense. 
 
Research by Electric Radiators Direct in the U.K. discovered that more than one-fifth of home workers had not turned on the heating this winter due to higher energy bills. The study also found that 49% of people who had worked at home in the last six months of 2021 are now considering working in the office more often as commuting would be cheaper than the expected additional energy costs. 
 
The EY survey found that for employers based in large conurbations around the world, 40% of people with a 30-minute or less commute were significantly more likely to be open to working fully in person in he office. The figure falls significantly to a quarter when commutes extend to 30 minutes and beyond”.

Francesca shares with us a few ideas that organisations can adopt to ease the cost of living burden on their frontline contact centre employees, whilst continuing to focus on employee wellbeing:

Competitor & Market Intel – Make sure you really understand the market around you, what other organisations are offering, what your employees are ideally looking for and most importantly once you have built up a picture of the world around you, ensure that senior stakeholders within the organisation are fully aware of the findings. Many organisations we are speaking to at HR / Recruitment and Line Management level are often relieved to hear insight around market conditions, but many are frustrated that their senior management team are not listening and many feel that they are ‘bashing their heads against a brick wall’ when it comes to recruitment and retention strategies.

Allowances – Ignoring staff worries over the rising cost of living could impact on employee relations and productivity. Savvy companies are shifting the costs of traditional office space back to help their employees, companies that are generous to their staff and help during a crisis, retain top talent, and attract new people who are vital to help them grow. Organisations could adopt an ‘Energy Allowance’, depending on the number of homeworking days. A similar type of allowance could be offered to support commuter costs and many firms could look at adopting a car share scheme, free charging points or public transport & fuel allowances.

Subsidised / Free Food – If you are able to subsidise canteens or even offer free in-workplace food, this can be a great incentive to get employees back to the office, but also help with spiralling food costs.  We have experienced organisations who have large fridges of canned drinks and cupboards full of bread, spreads, snacks, breakfast cereals and fruit. You don’t need to offer full meals, often snacks and breakfast can work just as well and can often represent a huge benefit towards employee wellbeing and cost saving.

Technology / Office Costs – Supporting employees with broadband costs, providing mobile phone, laptops, printers, air pods, office furniture etc…

Hybrid Working Strategies – The EY survey also found that four in five employees around the world want to work at least two days remotely per week. This year, only a fifth voiced reluctance toward fully remote working, compared to 34% last year. So, continuing to offer flexibility around hybrid work patterns is still a clear factor in retaining and attracting frontline employees, especially when considering weekend and shift working patterns.

‘Work’ has been re-designed by employees and employers alike, but their visions don’t always align. Both see flexibility and hybrid work as the new normal, however, embedding these successfully still means paying attention to culture, rewards and benefits. “

“Employers need to recognise the importance of providing even more training and support for employees and a platform that they can share feedback and communicate, especially if they are home working. Shift patterns and ensuring that employees take their breaks along with regular 1:1 sessions with their manager can also support employees,” says Jo.
 
Accessibility to their line manager can also help if they need to escalate and the technology to enable them to support customers effectively and efficiently. Include Employees in offering their ideas on how to improve your business as they talk to our customers every day a continuous improvement framework can also be very motivational for our employees to contribute to improvements  
 
If we also review the Employee Journey, do they have the tools to do their job, and do they work if we have feedback do we then ensure we resolve issues to improve employee and customer satisfaction  
 
By listening to our employees and implementing a clear communication strategy that is tailored and continually reviewed we all have a chance of getting through this challenging time”.
 
Janine concludes: “Giving frontline advisors extra support in the face of a higher volume of distressing calls will be vital for their well-being. In their personal lives, emotional and financial support are both important. With three-quarters of Brits wanting to find a new job to cope with the cost of living crisis, these measures become important in the face of recruitment challenges and the Great Resignation too. Altogether, this creates the perfect storm that businesses need to address head-on.”

Thank you to our editorial contributors:

Janine Hunt, Client Partnership Director at Kura (www.wearekura.com)

Jo Regan-Iles, Chief People Officer at Ventrica (www.ventrica.co.uk)

Francesca Randle, Director at Cactus (www.cactussearch.co.uk)

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