Businesses are being exposed to ever increasing levels of financial risk, but that means employees are, too. The impact of lockdowns in 2020-22 has resulted in a loss of $170 billion for workers, according to a Fortune report. At the same time, presenteeism, in which workers feel forced to come into work due to a lack of paid sick or annual leave, is costing businesses $150 billion per year in lost productivity, according to Business News Daily. This comes alongside the financial risks posed by cybercrime and a tight, shifting labor market. All of these factors can, and should, be planned.
Workers comp – and generosity
Sickness has created a considerable burden on US businesses. In all states but Texas, there are legislative requirements for businesses to offer workers compensation; in five states, this extends to short term disability benefits. This covers injuries incurred both on the job and outside of the workplace – though, it’s important to note the expanding gray area concerning remote working as to where liability starts and ends. The BLS estimated sick hours cost the business $0.45, which doesn’t sound like a lot but quickly stacks up. However, there are signals that offering generous sick days could be beneficial to the business. Studies conducted by the Center For Future Work thinktank indicate that just 10 paid sick days will increase business costs by a meager 0.2%. That’s serious food for thought on whether a slight adjustment in overheads could tackle, head-on, ramping insurance costs.
Tackling the cybercrime world
There is also a hugely increased risk of cyber crime when remote working is considered. This has pushed institutions as large as banks to invest in holistic cybersecurity training, according to American Banker in their summary of measures taken against ever-escalating cyber threats. The challenge is relatively obvious – portable hardware like laptops and phones create a challenge for employees that can create significant risk. Tackling this with proper insurance and a reviewed plan to account for employee cyber risk is crucial.
The tightening labor market
The US labor market has been extremely tight for months. This is pushing up wages, and confusing the hire process – however, as Reuters notes, there is also an increase in 10 month and over unemployment claims. This indicates that, for all of the high-skilled workers required, the market is changing in such a way that old skills may not be viable. That means older-style businesses may find themselves under pressure. Adapting to this shifting market is important, and is a tough financial risk to exactly quantify. However, as with all smart business plans, the key lies in innovation. Stay ahead of the pack and have a strong grasp of risk and you can manage the financial implications.
There’s a lot of opportunity for business growth right now, but also a lot of risk in the market, too. Managing that risk down will give you a clear eyed view of your next steps towards growth.