As we clear the decks from 2022, we look forward to 2023, though perhaps with some trepidation. What began as a year still under the spell of Covid-19 ends with a war in Ukraine and a cost-of-living crisis that is hitting everyone.
So, in our most recent International Business Barometer we are taking this opportunity to cast our gaze forward and see what the concerns and pains points of business decision makers are right now. We hope our insights help with your annual planning tasks.
Will Brexit ever disappear?
To understand the concerns of our respondents, we examined spontaneous responses to questions on barriers to supporting employees, initiatives to support employees and the biggest challenges businesses are currently facing and will face next year. To get to the point quickly we saw four key themes for 2023, and many not new:
• Material shortages
• Cost of living crisis
• Concern among employees
A concern that seems almost to be ever-present for UK business and an extent others is Brexit. Brexit was cited as the cause for aspects including staffing concerns, productivity, IT security and working with suppliers and clients. Given that we are a long way removed from the Brexit vote and the eventual departure from the EU, Brexit being challenging appears somewhat sad and surprising. That said, the impact of leaving the EU cannot be understated. It caused upheaval in the businesses and the effects of it are evidently still being felt, even amidst the cost-of-living crisis.
You can’t ignore the impact of the war in Ukraine
Similarly, the conflict in Ukraine is creating problems for industries that rely on raw materials to conduct their business. Respondents revealed that obtaining raw materials has been complicated by the rising cost of them, with one particular area relating closely to everyone being energy.
The energy crisis and in turn the rising cost living has created separate issues for decision-makers in terms of employee relations. There is real concern among staff, junior and senior alike, about how they will get through this challenging period. Indeed, some are even going as far as changing careers to increase their earning potential.
Who cares wins
This, therefore, creates a problem for companies as they are trying to retain employees whilst also coping with the increased cost of living themselves. Whilst they may want to support employees at this time, companies are not necessarily able to do so as margins are squeezed. Some, however, are going to lengths to support their employees through means such as job incentives and retention bonuses.
Such acts constitute far more than a gesture, in fact quite the contrary. For a company to go to lengths to help their employees is a sign of commitment to ensuring employee wellbeing. At a time when the pressure of the cost-of-living crisis will be negatively impacting employees’ mental health, any attempt to help should be recognised.
As we enter 2023, the challenges facing us will be unique. In Q4 2022 there were approximately 107,000 layoffs in the tech space. In the 2000-2001 Dot.com layoffs there were approximately 120,000, a brutally cold tech winter is coming. The cost-of-living crisis will continue to pinch in the early months of the year and potentially more so once government benefits are stopped. Moving forward, companies face the tricky task of balancing employee well-being and security combined with ensuring the health of their business during this tricky period. It is an unenviable task, but nevertheless something that we can combat provided that the right plans are in place.
If you want to be better prepared than your competition keep an eye out for our next International Business Barometer report that covers. Details of how different countries (UK, US & Germany) and types of organisations are faring and preparing for 2023 will be offered soon.