In the second part of our PwC Channel Islands Workforce Hopes and Fears Survey 2023, we explore further key findings including how financial pressures are affecting local workers, employees' problem solving capabilities and their level of confidence in their employers to equip them with the skills they will need for the future.
As showcased in Part One of our report, the Great Resignation appears to be over in the Channel Islands, with only 1 in 7 of workers across the islands likely to change employers in the next 12 months: a stark contrast to the global trend. This is good news for employers locally.
However, Part One of our survey also revealed that Jersey, Guernsey and Alderney workers report feeling stretched with unmanageable workloads. And more worryingly, compared to the global average, Channel Islands employees are less concerned about the impact of Artificial Intelligence on their jobs.
In Part Two of our report, we reveal the impact of the cost of living challenges on Channel Islands workers, and the readiness of the current working population for the future of work in terms of digital acumen.
“Our findings show that financial concerns are significantly impacting the Channel Islands workforce, in particular affecting our younger generations. There is a growing risk that the future workforce of the islands will be unable to remain locally for the long term, which has the potential to stunt economic growth.
Meanwhile, Channel Islands employees have strong traits as problem solvers who step up to take on more when needed - a dedicated and loyal workforce compared to global counterparts which is a huge positive for local employers.”
Nick Vermeulen,
Territory Senior Partner at PwC Channel Islands
Financial pressures: how the cost-of-living crisis can create opportunities for pay transparency
PwC’s Employee Financial Wellness Survey 2023 found that 57% of respondents perceive the top cause of stress in their lives as finances, leading to negative impacts on employees' sleep, self-esteem, personal relationships and their physical and mental health.
49%
of the Channel Islands workforce stated that their household is able to pay all bills every month and has enough left over for savings
41%
of the Channel Islands workforce stated that their household is able to afford paying bills, but has very little/nothing for savings, holidays and extras1
Almost half of respondents say their household is able to pay all bills every month and have enough left over for savings. However, with 41% of local employees indicating that their households can afford to pay bills, but has very little or nothing left for savings, holidays and extras - the second highest of jurisdictions compared - suggests that our workforce is feeling squeezed when it comes to increasing costs of living and interest rates.
Chart 1. Which of the following best describes your current financial situation?
Response: My household is able to pay all bills every month but has very little/nothing left over.
Our research suggests a divide across the population in the Channel Islands, where almost half of employees are living well, and the other half are finding it more challenging to make ends meet. Of those who have a second job, the most selected reason for this is to earn more money (74%), which is a consistent finding across our comparative jurisdictions. However, 36% of the Channel Islands respondents with a second job, also selected that their reasoning is for the opportunity to pursue work that they find rewarding2. Even though 16% of those surveyed have more than one job, it is clear that financial incentives are the driver for seeking secondary employment.
In the Channel Islands, a common assumption is that those in finance and insurance services live more comfortably. But our research indicates, the gap between finance and non-finance industries is not as wide as expected.
Chart 2. Financial pressures split by industry.
Our research also revealed a difference between generations, where younger workers report feeling more financially pressured than older workers. Having very little for savings, holidays, and extras for more than half our workforce3 should be a concern for the Channel Islands; where cost of living and lack of access to affordable housing could prevent younger talent from putting down roots locally and this may drive them to ultimately settle elsewhere.
Chart 3. Financial pressures split by generation.
Local governments should find this especially alarming. In PwC’s Islands Index Report, analysing the future economic growth potential of Guernsey and Jersey to 2050, both islands will continue to experience a rapidly ageing population. As the population grows older, the burden on workers to fund public budgets and resources through taxation will continue to be squeezed. The financial pressures being felt by islanders today could be a sign of a vicious circle to come, whereby islanders are financially stretched, making it less affordable to have children, which in turn will accelerate the island's ageing population, and therefore the strain on public services.
Businesses focussed on succession planning and building future leaders need to rethink how they can incentivise younger generations to remain on island.
44%
of female Channel Islands employees stated that their household is able to afford paying bills, but has very little/nothing for savings, holidays and extras
34%
of male Channel Islands employees stated that their household is able to afford paying bills, but has very little/nothing for savings, holidays and extras
Our findings also suggest that women are struggling more than men when it comes to finances, with 10% more female workers struggling to afford additional expenses compared to their male colleagues. This coupled with recent PwC research, the Women in Work Index 20234, that reports Jersey and Guernsey respectively have a 11% and 16% gender pay gap, is a worrying finding for the Channel Islands. In a state of nearly full employment and critical skills gaps in the local economy, employers should be promoting equality across all areas, including pay, to encourage more women to participate and remain in the workforce.
Given the intense financial pressures many are experiencing, surprisingly only 26% of Channel Islands respondents plan to ask their employer for a pay rise. The Global results predict that the pressure to increase pay will be intense over the next 12 months, with 42% of workers indicating that they are planning to ask for a payrise (up from 35% in 2022).
Chart 4. How likely are you to take the following action within the next 12 months?
Response: Ask for a pay rise.
At the time of publishing, local inflation rates remain stubbornly high: so why aren't the Channel Islands workers speaking up on pay? In some organisations there might be less of a 'speak up' culture meaning that employees may feel awkward asking for a pay rise for risk of a negative response. That could imply workers seeking higher pay might be more inclined to achieve this with a new employer.
The Channel Islands are competing on a global stage for talent, and it is no longer good enough to only benchmark total reward and employee value propositions locally. To remain an attractive jurisdiction which can acquire and retain the talent we need to sustain and grow our economy, employers and government should be regularly assessing themselves against other similar jurisdictions when it comes to benchmarking pay and benefits, and being transparent whilst working to close the gender pay gap.
Workforce behaviours: how employees can positively influence organisational culture
Employee actions and behaviours are just one way of discovering organisational culture makeup. PwC's Global Culture Survey 2021 reveals that organisations with a distinctive culture are more likely to have better business outcomes in revenue, and employee and customer satisfaction, than those who did not.
86%
of Channel Islands survey respondents agreed that when problems arise, they proactively try to solve them
76%
of Channel Islands employees’ felt that they take on extra responsibilities beyond their job description
Questions asked on current workforce behaviours demonstrated interesting conclusions for business leaders to consider. 86% of respondents agreed that when problems arise, they proactively try to solve them, demonstrating a willingness to take ownership and step forward in situations of crisis or uncertainty.
Chart 5. In thinking about your actions as an employee, to what extent do you agree or disagree with the following statements.
Response: When problems arise, I proactively try to solve them. Respondents answering Strongly or Moderately agree.
These values, as demonstrated by the comparison with other similar jurisdictions above, are perhaps harder to find elsewhere. Business leaders and Government should see this as an opportunity to leverage the unique problem solving skills of the Channel Islands workforce; especially in a highly regulated environment such as our own where we continually compete for business as a jurisdiction.
Within our previous report, we reported that 81% of the Channel Islands respondents believe their actions and behaviours at work are aligned with company values and directions, which is noticeably higher than other jurisdictions. With problem solving in mind, this suggests that local organisations have aligned values which allow them to be agile, nimble and think innovatively; these cultural characteristics generally push decision making down the organisation, to enable teams to take ownership of business outcomes and hold them to account.
Chart 6. My actions / behaviours at work are aligned with my company's values and direction.
Respondents who selected Often & Usually.
With this in mind, 76% of employees reported that they take on extra responsibilities beyond their job description; which could be due to the aforementioned organisational culture and values. It is important to note that this question was asked in relation to workers behaviours as opposed to assessing unmanageable workloads. However, in asking employees to take on further responsibilities, it poses two possible scenarios for business executives in the Channel Islands.
Chart 7. In thinking about your actions as an employee, to what extent do you agree or disagree with the following statements?
Response: I step up to take on extra responsibilities beyond my job description. Respondents selecting Strongly and Moderately agree.
Firstly, employees could be taking on extra responsibility as decision-making is pushed down the organisation, and they have a desire to demonstrate willingness and aptitude; which is positive for organisations and employees alike as long as the correct support and upskilling is available.
Another possible scenario is that employees feel that due to staff shortages and time pressures, there is an increasing expectation for them to take on more beyond their job description - an area which, if not closely monitored, could lead to toxic work culture and difficulty in retaining people.
Whilst considering the future of work and skills needed to progress, business leaders should take stock of the current company culture and workforce behaviours. This will give them the ability to appropriately devise a people-centric roadmap to their desired future state, and leverage the unique strengths of the people within their organisation.
Future skills: how to identify workforce skill requirements and leverage employee willingness
61%
of Channel Islands employees feel they actively seek out opportunities to learn/develop new skills
51%
of Channel Islands employees agree that they have a clear sense of how their required job skills will change in the next five years
PwC’s 26th Annual Global CEO Survey illustrated that CEOs are seeing multiple challenges to profitability in their industries. With 52% of CEOs believing that skills and labour shortages will significantly impact profitability over the next 10 years, understanding the future skills of the workforce and how these may change, will impact how organisations choose to invest, their strategy and overall objectives.
As highlighted, 61% of Channel Islands employees feel they actively seek out opportunities to learn/develop new skills. However, when compared to other financial jurisdictions, business leaders and Government should be concerned with the number of local employees who don’t have a clear sense of how their required job skills will change in the next five years, with only 51% of the Channel Islands employees agreeing that they do have this understanding.
Chart 8. I have a clear sense of how the skills my job requires will change in the next five years.
Respondents answering Strongly, Moderately and Slightly agree.
Despite almost half of the workforce not having a distinct direction of future skills needed, Channel Islands employers, compared with other similar jurisdictions, placed a higher than average importance on developing future skills in being adaptable/flexible, collaborative and critical thinking.
Chart 9. The three skills that were noted as being the most important to respondents careers in the next five years, in the Channel Islands.
Respondents answering Extremely and Very important.
On the other hand, the same respondents placed less than average importance on building analytical/data, digital and green skills. PwC’s Upskilling the Channel Islands' workforce for a digital world report predicted that 27% of Jersey jobs and 32% of Guernsey jobs were potentially at risk of automation by 2035, and the PwC's Green Jobs Barometer for the Channel Islands reported that the demand for green skills is likely to grow from 1% to 15% if current trends continue.
Chart 10. The three skills that were noted as being the least important to respondents careers in the next five years, in the Channel Islands.
Respondents answering Extremely and Very important.
Local employees may not be clear on the future skills needed and where they should prioritise development, however they are ready to upskill. With 61% of employees feeling that they actively seek out opportunities to learn/develop new skills, higher than global and similar jurisdictions, it does infer that a strong majority of our local workforce plays an active role in their own upskilling and self-development.
Chart 11. In thinking about your actions as an employee, to what extent do you agree or disagree with the following statements?
Response: I actively seek out opportunities to learn/develop new skills. Respondents selecting Strongly and Moderately agree.
But the trust they have in their employers could hinder progress. Channel Islands workers have significantly lower confidence, compared with other similar jurisdictions, that their employer will provide them with the right tools, resources and opportunities to build upon skills.
Chart 12. How confident are you that your employer will provide the tools, resources and opportunities you need to build upon the following skills within the next five years?5
Respondents answering Extremely and Very confident.
Although it is likely those selecting responses were considering their personal aspirations and requirements for future skills, the Future of Jobs report, found that analytical and critical thinking skills were the top two core skills required by workers today. Our results, however, demonstrate that, in comparison with the PwC Global report, the confidence employees have in employers providing both these skills are 25% less in the Channel Islands, which is a stark contrast to the rest of the world.
“Channel Islands workers are not getting the support from employers they should be to develop skills for the future, and are consequently less aware of the importance of digital/analytical skills. They are uncertain how their roles will look in 5 years and, as mentioned in Part One of our Hopes and Fears report, are less aware of the impact AI might have on their jobs.
This should be a wake up call for employers - invest more in your staff, they are dedicated, willing to go above and beyond and plan to stay with you for the medium term. But you are falling short when it comes to upskilling them for a digital future, and risk making your workers and your business obsolete.”
Sarah Hollingsworth,
Workforce Lead at PwC Channel Islands
The importance of upskilling should be recognised as a strategic priority for Channel Islands business leaders; but employees are not confident firms they work for are going to invest in helping them grow recognised important skills. This is a concern as it could indicate that local employers are not investing in critical future skills.
Moreover, the Channel Islands workforce may end up as one without future-proof skills, which also could lead to question the long-term viability of businesses who fail to react. Without investing in future skills, employee confidence and abilities will continue to weaken and the Channel Islands as a jurisdiction will inevitably get left behind.
Key Takeaways
1. The right Reward
Business leaders need to be mindful that particularly for lower-paid members of staff, the cost of living challenges could be adding significant pressures. Reviewing policies on areas such as expenses reimbursement can ensure that your people are not out of pocket. Regular benchmarking of pay and total reward needs to be baked into the talent strategy. For certain roles, compensation benchmarking against other jurisdictions outside the Channel Islands may be necessary. Make sure you are testing your benefits with staff on a regular basis to ensure they are valued, relevant and aiding recruitment and retention in the way you hope they are.
2. Upskilling for the Future
The time for dabbling with AI is over, businesses need to get serious about how technology will continue to disrupt and create opportunities. If you don't have a programme for technology training and upskilling, you need to set this in motion as soon as possible, or you risk being left behind and your workers could become obsolete. Research suggests that reskilling an existing staff member saves businesses up to £49,100 per employee.
3. Protect Culture and Values
Continue to focus on your organisation's purpose and values - something your employees feel strongly about in a positive way. This is a solid foundation to build the right team culture for success. But be alert to culture clashes or leadership behaviours that could disrupt or undermine your values, and find ways to deal with these quickly.
4. Support employees through Change
Many business transformation initiatives fail because the people aspects of change are overlooked or a lower priority. Have a clear people, change and communications plan to support your transformation programmes, win hearts and minds and ultimately achieve the benefits you were hoping to realise through the transformation. When it comes to employee engagement, over communicating is preferable to under communicating.
Footnotes
1Other Channel Islands responses were:
- 7% My household struggles to pay all/some bills every month
- 1% My household cannot pay the bills most of the time
- 1% I don’t have any financial responsibilities
- 2% Prefer not to say
2Noting that respondents could select multiple responses on this question.
3Those aged between 16-44 account for 52% of the Jersey and Guernsey workforce, taken from Census Data in 2021 for same year consistency:
Jersey
Guernsey
5Note - for the question “How confident are you that your employer will provide the tools, resources and opportunities you need to build upon the following skills within the next five years?”, a complete question data set for Luxembourg was unavailable from Global results and therefore not included in comparison.
Appendix
Methodology
The global research study on the Hopes and Fears survey aims to understand the attitudes and behaviours of employees.
As part of this study a 10-15 minute survey was conducted 27 April - 4 June 2023, with the data being collected by Island Global research on behalf of PwC to target a representative sample by age, gender and island. PwC Channel Islands have produced this report using data provided by the external provider.
Only fully completed responses were showcased in a Power BI dashboard, evidently reducing a total of 659 responses to 563 responses. A representative split of responses were received between the three islands, where 54% of respondents were from Guernsey, 45% from Jersey, and 1% from Alderney. Gender-wise, 68% of respondents were female and 30% were Male. The age split by generations were as portrayed in below chart:
Chart 13. Age of respondents by generation.
Industry-wise, the largest representation of respondents, 25%, were from financial and insurance sectors providing a very similar breakdown to the Channel Islands industry make up. The top six industries accounted for 74% of the total respondents. The total split in responses are as follows:
Chart 14. In which industry does the organisation you work for operate?
Analysis includes only representative results, considering size of response samples and make up of the Channel Islands personal and economic demographics.
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