MRA Releases Results of Employers' Rising Fuel Cost Strategies Survey Employers See Recruitment/Retention Impacted; Seek to Offer Employees Assistance

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Fuel prices aren't only hitting employees' wallets. They are impacting the ability of employers to recruit and retain employees whose commutes are getting more costly. According to a new study of Wisconsin, Illinois, and Iowa employers released by MRA-The Management Association (MRA), more than half of responding companies have seen their ability to recruit and retain quality employees impacted by rising fuel costs.

Fuel prices aren't only hitting employees' wallets. They are impacting the ability of employers to recruit and retain employees whose commutes are getting more costly. According to a new study of Wisconsin, Illinois, and Iowa employers released by MRA-The Management Association (MRA), more than half of responding companies have seen their ability to recruit and retain quality employees impacted by rising fuel costs. In response, employers are undertaking a variety of scheduling, compensatory, and educational strategies to attract and keep talent. MRA is the second largest not-for-profit employers association in the country, helping companies to recruit, develop, and retain talent.

Impact
Fuel prices are hitting companies twice. Results from MRA's Rising Fuel Cost Strategies survey show that more than 80% of companies feel increased fuel prices have hurt their margins. Among those who have felt the impact, 66% have seen an increase in the cost of goods and services purchased; 38% have had to implement cost controls; and 16% have experienced declining sales. On top of that, escalating fuel costs have directly affected the ability to recruit and retain talent for over half (54%) of responding companies. Among those impacted, 33% report difficulty hiring talent who live at a distance; 25% have seen requests for an increase in mileage reimbursement rates for company business; 19% have had employees leave the company for an employer closer to home; and 4% have experienced increased absenteeism.

Actions: Scheduling Options
To stem the impact of fuel costs on the workforce, one of the top strategies that emerged from the survey is scheduling. Companies are taking a second look at the traditional 5-day work week and seeking to create more palatable options for their employees. Many companies already successfully use variations of flextime or a compressed work week. Others are now taking a serious look:

  •     Flexibility in starting and quitting times to avoid peak traffic times

27% currently offer this option and 11% are considering it

  •     Telecommuting (offsite work arrangements for all or some days of each week)

15% offer this option and 16% are considering it

  •     Four 10-hour shifts - year round

13% offer this option and 19% are considering it

  •     Four 10-hour shifts - seasonal

7% offer and 15% are considering it

  •     9/80 shifts (the employee works 9 hour days and takes off one day every other week)

4% are currently doing this and 14% are considering it

"Strong employers recognize the key link between organizational productivity and employee satisfaction," says Bonni Yordi, Ph.D., MRA's Director of Surveys and Business Research, and lead researcher on the study. "Our research on 'Employers of Choice' shows that employers who form a partnership with employees and are proactive in addressing employee issues, cultivate more loyal, more engaged employees. Employers who can demonstrate a we're-all-in-this-together attitude and extend options that help employees better manage high fuel costs create a much higher probability that they can attract and retain good employees."

Actions: Decrease Employee Gas Outlay
In addition to scheduling adjustments, over half (56%) of companies have at least one or more of 16 possible tactics in place to directly address increased commuting costs. Another 23% are considering implementing one or more tactics before the end of the year. That leaves 21% who do not plan to take any action related to this matter.

Top employer strategies to decrease employee gas costs include:

  •     Provide gas giftcards as one time gifts or spot awards for performance.

23% currently offer this option and 22% are considering it

  •     Assist with carpooling arrangements by organizing or hosting networking opportunities for employees.

9% currently offer this option and 23% are considering it

  •     Encourage carpooling by offering incentives to employees who carpool.

5% offer this option and 23% considering it

  •     Offer public transportation subsidies / incentives / discounts.

4% offer this option and 22% are considering it

Between 1% and 8% of the companies currently have the following tactics in place, while an additional 13% to 16% are considering them:

  •     Offer information/educational programs on gas-saving practices.
  •     Support bike programs such as free bikes, secure bike parking, showers, etc.
  •     Provide higher merit increases to help with rising cost-of-living expenses.
  •     Give a flat dollar amount to subsidize gas prices.
  •     Add cost-of-living adjustments, not tied to merit increases, to help with fuel costs.
  •     Provide a company-provided discount card that saves employees "x" cents-per-gallon.

For companies in urban areas, in addition to transit subsidies, 2% to 7% of the companies currently have the following options in place, while 11% to 16% are considering these options.

  •     Provide free downtown parking.
  •     Provide bus or train schedules to encourage transit use.
  •     Offer pre-tax dollar program for public transportation and / or parking (IRS Section 132).
  •     Provide shuttles from mass transit stations or other designated pick-up points.

When employees use a personal vehicle for business use, over three-quarters (76%) of the companies reimburse at the current IRS rate of $0.585; only 1% reimburse above this rate. The remaining 23% reimburse below the current IRS rate. In the next six months, 8% plan to increase their rate.

MRA's online survey Rising Fuel Cost Strategies drew 415 respondents, representing companies of all sizes (1-99 employees 45%, 100-500 employees 48%, and over 500 employees 7%) and nearly equally split between manufacturing (55%) and non-manufacturing (45%).

Founded in 1901, MRA is a not-for-profit employers' organization serving more than 4,000 employers throughout Wisconsin, Illinois, and Iowa, covering close to a half million employees. An expert in the optimization of human resources, MRA applies its talent, tools and training to help organizations achieve their business objectives. For more information on MRA visit http://www.mranet.org or call 800.488.4845.

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