Seven bucks for a gallon of gasoline? Sources tell us that this could be in our future, perhaps sooner than we think. And the pain could be felt far beyond the pumps, impacting our ability to effectively attract, retain and reward employees.
Ryan Johnson's WorldatWork Blog highlights a great article by WorldatWork editor Bob King, which discusses the implications of the cost of gas for employment relationships. He focuses particular attention on the total rewards implications, with expert advice on how to address the increasingly high costs of commuting as part of the overall employee value proposition.
From the article, Jennifer M. Verive, Ph.D., CEO of White Rabbit Virtual Inc., describes the concern:
Our employee surveys find that the cost of the commute is beating out ‘time spent in the commute’ as employees' number one commute concern. Getting a job closer to home is no longer about time convenience; it's a $60 fill-up that takes money away from other personal and family needs. The first time we saw this was when gas was about $2.25/gallon a couple of years ago. The trend has increased along with gas prices and is especially strong among lower-paid employees, such as customer support representatives. Currently, a growing number of employers are worried about this, as they know employees are factoring it into their cost of living and net wages. In regions with high home prices where commutes are longer, attracting new employees is now even more difficult.
Experts warn (and I would second this warning) of the pitfalls associated with simply increasing base pay (in the form of a "cost of living" increase) to address these rising costs. What happens if gas prices continue to increase indefinitely, and you've set a precedent for covering the cost? And why increase pay to address fuel costs but not rising healthcare expenses? Again, potentially dangerous and slippery territory to step into.
Alternatively, the article offers companies other options to help alleviate the burden on their employees, including:
- Transit subsidies
- Car pooling/van pooling (along with a contest and/or incentives)
- Flexible scheduling options such as a compressed work weeks or alternating start times
- Teleworking, where feasible, once or twice a week
The article also steps beyond rewards to examine the impact that this trend will have on organizations' overall ability to attract and retain workers.
Check out the article for more information and details. This is an issue that will be calling for increased consideration by HR professionals. Special thanks to Ryan and Bob for bringing it to our attention in such an informative and well-researched way.
Image: Andrea Church