New research from Strutt & Parker has shown that the housing crisis is now a serious concern for companies with the issue being discussed in many UK boardrooms.
The consultancy surveyed 1,000 UK C-Level executives and business owners about the impact of housing on their businesses. A clear message comes through from the eye-catching results; if the lack of affordable housing has become one of the defining challenges for young professionals, it is also emerging as a significant impediment to the growth of the employers.
According to the findings, 74% believe that high housing costs are having a negative effect on their business. With 55% admitting to losing staff because employees either cannot afford to live in the area or are unwilling to commute. 73% said that they have struggled to attract new employees because of high housing costs in the area. In order to combat this, 71% of respondents are either actively considering investing in residential areas for their employees or are thinking about doing so in future.
Stephanie McMahon, Head of Research of Strutt & Parker's parent company, BNP Paribas Real Estate, said: “We asked 1,000 company owners and executives about the impact of housing on their business and they issued a stark warning. When it comes to employing staff, high housing costs are restricting growth and profitability. It's an issue that directly affects the ability of businesses to expand. According to our survey, high housing costs are responsible for a lack of skilled workers applying for jobs and slower expansion due to unfilled positions.”
Top three ways respondents say that the housing crisis has affected the growth of their business:
39% higher wage costs
37% lack of skilled workers
31% slower expansion due to unfilled positions
The survey reveals that the issue of housing affordability has spread right across the country, extending far beyond London, and is now so serious that three-quarters (73%) of companies would consider relocating to an area with more affordable housing. Some businesses are contemplating an even more radical solution. In one of the most dramatic findings of the survey, 71% of respondents are either actively considering investing in residential areas for their employees or are thinking about doing so in the future.
The UK's competitive jobs market means that employers are having to look at a range of options to attract and retain staff.
Jeremy Langridge, who specialises in Occupier Solutions at BNP Paribas Real Estate, has noticed a greater willingness to support employees amongst his clients. He says: “The wellness offering for staff is a big part of their agenda. One element of this is looking at ways to make it easier for employees to get to work, whether that's improving transport access or flexible working. All businesses are having to engage with the issues faced by their employees, which include longer travelling times due to high housing costs, to ensure they attract the best talent and retain those they have already.”
The survey results also show that there is another thing which unites business leaders – the need for greater government support, both national and local. Nearly half of respondents (48%) believe a policy of building affordable new housing in the area around their business would help them to recruit and retain staff. Over a third (35%) also called for a policy on affordable rents and 30% wanted investment in public transport to make commuting easier and more reliable.
Stephanie McMahon concludes: “Anybody would recognise that in major cities around the world the inability to provide housing that people can afford is probably one of the biggest risks to global competitiveness. You can improve infrastructure and rely on people to commute for longer, but it's a little like sticking a plaster on the problem.”