How to survive the Summer of Discontent
The Winter of Discontent was in 1978-79, so-called due to a series of strikes, inflation, division and, to top it off, the coldest weather for over a decade. With the exception of the weather, this might sound familiar.
What’s happening now?
Rail and Tube strikes in London recently caused huge damage to the economy, with more set to come. Teaching unions NASUWT and the National Education Union have called for pay rises due to the cost of living crisis , and are promising to ballot members over strike action if the wage rise is not forthcoming.
And Unison is warning that industrial action could also spread to the health service unless a pay deal close to inflation is agreed, with Chair of the NHS
Confederation Victor Adebowale warning a real-terms pay rise for the lowest-paid NHS staff was needed to avoid “a worsening of the NHS workforce crisis”.
In the winter of 1978, Ford car workers secured pay rises of 17%. But this time around, the outcome will not be so generous. Chief Secretary to the Treasury, Simon Clarke, has said that wages in the private and public sector can’t keep up with the price rises, or inflation will get worse.
Why?
The devil in all this is inflation : it is both the fuel for demands for better pay, and a consequence of better pay awards. And it’s at its highest level for 40 years (9.1% in May 2022, according to the ONS).
Paul Johnson of the Institute for Fiscal Studies puts it more starkly: “The question for the government is how to distribute the pain, across people and across time, not how to avoid it altogether.”
So how can you protect against the Summer of Discontent?
The starting point is to undertake a complete review of your company’s operations, preferably with your accountant or another trusted business advisor. This review should be thorough, focusing on all areas of the business.
Once you’ve ascertained where you are now, you can focus on where you want to go. Write a short business plan stating your goals for the next three, six and 12 months, and outline how you will achieve these goals.
Be objective. Seek opportunities where you can improve the bottom line. If some parts of your business aren’t making money, is it time to close them? Again, your trusted business advisor can help you re-focus, as you seek to cut costs and improve profitability.
Scrutinise your staffing roles. Are employees engaged in tasks that are not business critical? If so, redeploy them to where they can be more useful.
Remember, that it’s vital you talk to your employees during this process, keeping them ‘in the loop’ the whole time.
Finally, speak to your suppliers. Try to negotiate discounts, or better payment terms. They are likely to want to help you where they can – after all, they don’t want to lose a valued customer.
Our Kitchen Table Guide talks you through the necessary steps to separate your business into the parts that are – and are not – working, and helps you build a plan for the future. You can download the guide here
The one thing you cannot afford is to do nothing. If you are feeling overwhelmed – which is perfectly natural – then seek expert help. Our team of business rescue experts and insolvency professionals can help steer you through the ‘Summer of Discontent’.
Call us on 01455 555 444 or email [email protected] and we can call you back.