The recent CIPD Megatrends Report ‘Have we seen the end of the pay rise?’ concludes that businesses must be agile and aware of changing trends that may affect their business and be ready to respond to them and make them work in their favour in order to maintain an advantage over the competition.
The findings showed that since January 2009 average weekly earnings (without bonuses) have fallen by 8%. And the recession also saw a fall in labour productivity (the amount of value added/created per hour worked). Less productivity has meant less money available for wages. And it is not only the UK that is affected – many employees across Europe saw their pay frozen or cut during the recession.
Here’s how one manufacturing company has found a way to help improve productivity and control labour costs.
Based in Birmingham, Hozelock employs up to 600 people at its 28,000m² site. Hozelock manufactures and assembles equipment for garden watering, spraying and aquatics for the UK and international markets. The company identified the labour-intensive assembly area as the key area to focus. By introducing job costing software that works together with their manufacturing workforce management solution they gained visibility into how their operations perform against productivity goals and benchmarks. Alan Murphy, Manufacturing Manager at Hozelock explains: “We introduced (Kronos) Activities part way through the season and immediately started to see that productivity had already improved about 2% over the previous year on our assembly lines. The closer scrutiny on performance at a local level, rather than globally, increased levels of focus on output and performance.