Tumultuous times ahead for customers and business – what is the risk on your labour and on your business outlook?
Consumers are facing a challenging 2015; increases in petrol and electricity prices as well as a potential interest rate hike (predicted to happen during the second half of the year) are some of the factors expected to put pressure on consumers.
With a lower disposable income in the consumer’s pockets, at least for the foreseeable future – how is this tough economic outlook going to translate to salary increase demands, morale of the employees in general and possibly the forthcoming local elections in 2016?
Answers to these questions are as clear as mud and only time will reveal what the outcomes are. However, risk managers are still expected to engage business and look into crystal balls to predict the future and mitigate potential impact of risks arising from these factors.
At a glance, the potential risks appear to be in the areas of:
Finances – reduced ability to meet financial needs, possible increase in personal debts and lower moral or even depression due to the bleak outlook.
Labour engagements – unions may continue to be more militant and aggressive in the salary negotiations in an attempt to offset the increased financial demands facing all South Africans.
In addition to petrol and electricity, customers are also just recovering from the recent tax increases announced by the Minister of Finance during the budget speech in February, as well as the fuel levy increases which also contributed to the petrol hike. In addition to this, Gauteng residents still have to contend with the e-tolls, which remain an unresolved matter despite the assessment conducted by the E-tolls Panels committee instituted by Gauteng Premier David Makhura.
All these factors, that have been widely reported on and analysed in the media, are also likely to dim public confidence around the economy – especially as the GDP growth is also expected to remain muted at around 2% or less.
- Do you have plans/programs that will give advice to staff as they face potentially tough financial outlook?
- Do you anticipate potentially tougher engagements around salary increases in light of these pressures faced by the average consumers?
- How do you aim to assist staff facing financial difficulty? Both in terms of raining/maintain morale and providing advice on how to survive tough economic times.
- If you are a business selling to customers, do you have strategies to continue increasing revenues in an environment where customers have less cash?
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