Inflation’s impact on the workforce

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As employers grapple with whether to recall their teams to in-office work or to offer more flexibility with a remote or hybrid workforce, new data revealed by First Insight indicates that remote/hybrid workers are more negatively impacted by the effects of inflation than full-time in-office workers.
As employers grapple with whether to recall their teams to in-office work or to offer more flexibility with a remote or hybrid workforce, new data revealed by First Insight indicate that remote/hybrid workers are more negatively impacted by the effects of inflation than full-time in-office workers.
Fifty-six percent of remote/hybrid workers say that inflation is causing them to worry about their salaries or current job situation compared to 51% of in-office workers. High grocery prices are impacting the daily lives of 62% of remote/hybrid workers compared to 55% of in-office workers. Discretionary spending is taking a hit as well. Dining out is being reduced by 27% more remote/hybrid workers while travel and vacations are being cut back by 42% more remote/hybrid workers.
“Employers who believe they are doing the right thing by continuing the remote/hybrid way of working may actually be doing their workforce a disfavour if they are not overly communicating with their teams,” said Greg Petro, CEO, First Insight. “Whether caused by less in-person connectivity, lack of communication or a varying schedule, the remote/hybrid workforce clearly has more concerns about how inflation will hit their wallets than their in-office counterparts.”

While the report finds that everyone has less confidence to spend in the current economic climate, remote/hybrid workers are making different purchasing decisions than their in-office counterparts in order to deal with rapidly rising prices of gas and groceries. Food is, overall, one spending category where the biggest differences in spending can be found. Seventy-one percent more remote/hybrid workers have started shopping at bulk or warehouse clubs to get more value for their dollar.

Remote/hybrid workers are noticeably cutting back on premium-priced groceries with 39% reducing their spending on meat and seafood versus 33% of in-office workers; 30% cutting out organic foods compared to just 21% of in-office employees; and 22% reducing bread/bakery purchases compared to 15% of their in-office counterparts.

With remote/hybrid workers presumably making coffee at home, it’s not surprising to see that 55% more remote/hybrid workers are reallocating money previously spent on specialty coffees and beverages.

Interestingly, one place where in-office workers were cutting back more than their remote/hybrid counterparts was on electronic gaming. Thirty percent of in-office workers say that they will reduce their spending on games, with only 26% of remote/hybrid workers saying the same.

The report also finds:
Across the entertainment category, remote/hybrid workers are spending less on nearly all activities. Going to the movies is being cut by 23% more; concerts 52% more; sporting events 42% more; streaming services 41% more; amusement parks 24% more; and museums 44% more. Fifteen percent more in-office workers are reducing their entertainment spend on electronic games compared to remote/hybrid workers.

In the apparel category, remote/hybrid workers are cutting back on all categories more than in-office workers. Not surprisingly, the biggest disparities in spending are for dress shoes, with 33% of remote/hybrid workers spending less versus 25% of in-office workers; 30% of remote/hybrid workers reduced purchases of seasonal apparel compared to 22% of in-office workers; and 25% cutting down on professional work apparel compared to 18% of those in office.
When it comes to travel, 46% of remote/hybrid workers are driving less frequently compared to 40% of in-office workers; 40% are taking fewer vacations compared to 33% of in-office workers, and 25% are reducing their spending on hotels compared to 19% of in-office workers.

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