Employers are reducing fringe benefits such as business travel and hospitality to cut costs during the recession.
The latest quarterly research by the Chartered Institute of Personnel and Development(CIPD) and KPMG shows that two-thirds of the 892 UK employers surveyed have either already experienced a budget cut or are about to.
The research found that 20% of employers have reduced or cut the availability of free drinks or biscuits at meetings and over half (55%) have reduced their budget for client entertaining.
Tim Payne, head of HR at KPMG, said employers need to handle these cuts sensitively. “Firms don’t want to alienate staff at a time when employee goodwill is a vital commodity.”
The cuts look set to differ across the private, public and voluntary sectors.
For instance, three-quarters of private sector employers (74%) have reduced their travel expenses, compared with 50% in both the public and voluntary sectors.
Gerwyn Davies, public policy adviser at the CIPD said this better communication could make a huge difference to organisations battling to survive the recession. “This is particularly important against the background of higher levels of job insecurity and lower pay awards.”
Key findings:
- 38% of UK employers have reduced business travel.
- 69% of organisations that have reduced business travel spend have reduced travel expenses, while 60% have reduced international travel.
- 64% have reduced the use of taxis and 65% have reduced the use of first class travel.
- 68% of private sector employees say they have decreased the use of first class travel, compared with 54% in the public sector and 40% in the voluntary sector.
- 66% of private sector employees have cut international travel, compared with 38% in the public sector and 25% in the voluntary sector.
- 74% of private sector employers have reduced travel expenses, compared with 50% in both the public and voluntary sectors.
- 62% have increased the use of tele/videoconferencing and 43% have increased the use of public transport.
- 55% have reduced client entertaining.
- 20% have reduced or cut the availability of free drinks or biscuits at meetings.
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