The definition of a ‘cost-of-living crisis’ is when the cost of everyday essentials such as energy and food are rising much faster than the average income.
High inflation and low wage growth are the main reasons for the current cost-of-living crisis. Inflation is rising faster than wages and people have less money to spend on the things they need. Added to this, interest rates have risen, resulting in monthly mortgage and rental payments rising dramatically.
As maritime HR and recruitment specialists, we are acutely aware of the current crisis in not only the UK, but across the globe. In Singapore, one of the largest shipping hubs in the world, and the location of many of our key clients, we are hearing that the cost of everyday essentials is rising dramatically, and salaries are not keeping up with these increases.
Back in 2005, Spinnaker established the Maritime HR Association – a members ‘club’ for global shipowners, shipmanagers, oil majors, commodity groups and shipbrokers.
The purpose of the Association is to provide reliable compensation data, which assists members with their salary reviews and maritime recruitment processes. The Association also serves as a forum for the sharing of ideas and experiences in regard to HR policies and best practices in the maritime sector.
Earlier this year, we were asked by our member companies to conduct an ‘Information Exchange’ on the cost-of-living crisis in Singapore. The Members were keen to know what other organisations in the sector were doing to address the crisis, as the situation was unprecedented for many.
The results were shocking, but perhaps not surprising, as a whopping 89% of responding member companies had received concerns from employees on the increase in the cost-of-living in Singapore mainly due to rising prices of rent, food, schooling and transport.
Nearly half of the companies (44%) who responded had taken some steps to address the impact of the cost-of-living crisis. Solutions implemented to assist employees included increasing salary review budgets, providing a one-off bonus or offering financial well-being assistance.
With regards to employee benefits, member companies were more likely to increase allowances for housing than they were for car or other transportation.
Members of the Maritime HR Association who participated in this Information Exchange also benefited from a detailed report of what other maritime companies are doing in Singapore which resulted in them feeling more informed to make decisions about how to assist employees in the region.
Economists say that although inflation will start to fall, it will be at a slower rate than expected. As a result, it will take time for employees to feel the benefit, and the cost-of-living crisis won’t fully be eased until wages catch up.
If you are interested in finding out more about the Maritime HR Association and the HR support provided to the shipping sector then get in touch with the team today or find out more online.
