John Lewis’s boss said over-50s leading a ‘great resignation’ had shrunk the UK labor market and caused inflation.
About a million people have been forced out of the workforce since the pandemic, leading to inflation and rising wages, chairman Sharon White told BBC Radio 4’s Today programme.
Fewer workers means companies are facing pressure to raise salaries, which is pushing up prices.
It’s also having a big long-term impact on companies struggling to find jobs, added Dame Sharon.
Despite rising inflation and wages, the John Lewis Partnership has made it clear that it has no plans to raise wages for its employees to match the current rate.
The company announced in April that it would give its employees, known as ‘partners’ within the group, a 2% raise and a 3% bonus, as well as a voluntary real living wage set at £9.90 an hour outside London. did. £11.05 an hour in the capital.
We will also double our employee support funds from £400,000 to £800,000, combining grants and loans for financially challenged staff.
Targeted support measures include plans to provide free meals to all employees from October through January to coincide with the expected spike in winter energy costs.
But pushing wages in line with inflation could hurt businesses and the economy, Sharon said.
“As a company, we try to balance affordability considerations with how our partners deal with the cost of living,” she said.
“However, we need to be vigilant about job security and business sustainability, as well as potential wage inflation spirals and their implications for business and the broader economy.”
Dame Sharon, who once headed broadcast regulator Ofcom, added that businesses and governments need to work together to encourage workers over the age of 50 to return to work.
She said flexible retirement options and retraining to another profession after age 50 could be the solution.
A wave of staff leaving their jobs in search of better wages and job satisfaction or to retire entirely has sparked a “massive retirement” after the nationwide lockdown.
Nearly a fifth of UK workers said they were planning to leave their jobs for a new employer within the next 12 months, according to a PwC survey released in May.
But Bank of England Governor Andrew Bailey said earlier this month that workers should refrain from asking employers to raise wages in line with inflation to prevent inflation from being “baked in”.