Employer response to inflation

There has been a tremendous amount of commentary on rising prices, not just at the gas pumps, but in every aspect of society. On the one hand, some pundits are blaming congress for a seemingly laissez-faire approach to oil companies. On the other, blame is being placed on oil companies accusing them of price gouging. The economic experts and politicians have all weighed-in on this crisis we all face as Americans, but what have they done as remedies to these problems?

It was only a few weeks ago when I wrote about the national average of gasoline nearing $4.00 per gallon. Well, the $4.00 mark has already been exceeded and is expected to continue the upward pattern in the days, weeks and months to come. Airlines are also being hard hit with the extremely high jet fuel prices that are landing in the wallets of patrons in the form of new fees. Fees include an unprecedented first checked bag fee or a $20 per passenger surcharge. One airline has gone so far as to completely discontinue the in-flight gourmet, two-course meal of peanuts and your beverage choice. Most recently, another airline laid-off 3,000 employees. A thought that continues to nag me is whether the price hikes that affect everyone are as serious as the measures being taken by many major American companies. The answer, though intriguing and obvious, to some degree, is outside the scope of this article.

The contrast to these steadily rising prices in virtually every industry is the fact that few employers are providing employees with cost of living increases. Hardworking Americans who depend on their weekly or monthly paychecks for basic survival are expending greater proportions in simply getting to work as well as putting food on their tables. Budgeting is difficult as prices are so unpredictable that it causes almost daily adjustments.

Granted, some employers are unable to pay increases that equalize employees with the costs of living. It is also true that many companies, particularly small businesses, may not be able to afford even the smallest increases. However, there are other ways that employers can improvise to assist employees. Some companies have devised shorter work schedules in hopes of preventing parents, for example, from paying penalties for extended childcare. A number of colleges and universities around the country have instituted four day (opposed to the traditional five day) weeks with estimates of students and employees saving hundreds of dollars annually on commutes—not to mention the savings for the institutions. These are only two of hundreds of options employers can explore to help ease the hardships faced by many of their best and brightest employees.

Employees have a responsibility to their employers. The same is true in the reverse. These relationships should be of reciprocal dealings to ensure productivity for both parties. There are few exceptions to society’s current woes, but the classes of people depending on their earnings to survive are hardest hit. Not every idea is practicable for all employers, but it is necessary to explore options that can be tweaked to suit a given profile. For example, researchers Kate Lister and Tom Harnish have shown that about 40% of American jobs could be done remotely (telecommuting). However, only 4% are currently using this method. Imagine the savings!

As employees work to make their employers look good, employers should make sacrifices that illustrate a commitment to their employees. © 2008 Keydron Guinn