Manufacturing firms most likely to cut back on giving this Christmas

Manufacturing firms are half as likely to provide a Christmas gift and the number throwing a Christmas party has dropped from 71% in 2005 to 60% this year, according to preliminary findings from the Chartered Institute of Personnel and Developmentís (CIPD) annual Reward Management 2007 survey.

Less than two-thirds (60%) of manufacturing firms will provide a Christmas party, compared to 71% in 2005. However, public sector and voluntary sector organisations still remain those least likely to provide a gift or throw a party at Christmas.

Charles Cotton, CIPD Reward and Employment Conditions Adviser, says: ìA combination of intense competitive pressure and higher non wage labour costs has squeezed profit margins, over the last year. This will have resulted in greater efforts to control costs causing modest increase in pay cuts and job losses. So less festive generosity this Christmas is likely to be symptomatic of such pressures, rather than indicating a more Scrooge like attitude just for the sake of it.

ìMaking cut backs might be necessary but if these are not communicated effectively to staff they could cause lack of motivation and poor performance, costing businesses more in the long-term.î

The results indicate that 64% of employers meet the majority or most of the cost of a Christmas party. However, only 9% now provide a Christmas gift such as a hamper or vouchers.

ìResearch indicates that employees are attracted, retained and motivated by a whole variety of rewards and there is not one solution that will meet everyoneís needs. In todayís tight labour market it is becoming more and more important for organisations to be flexible in their approach to reward if they are to compete in the war for talent.

Employers need to work with employees to find out what they want and then develop rewards that meet both the needs of the business and the workforce,î adds Cotton.

The survey highlights differences between various sectors:

Private sector service employers are the most generous with 83% likely to provide a Christmas party.

60% of the manufacturing and production firms provide a Christmas party.

59% of voluntary sector organisations provide a Christmas party.

Only 23% of public sector employers provide a party or lunch.

Manufacturing and production companies are most likely to provide a gift, with 12% doing so.

Only 10% of private sector service, 7% in the Voluntary sector and no public sector workers will receive a gift such as a hamper or voucher.

Size matters
Small private sector organisations remain more likely to provide a gift at Christmas or organise a party, with four-fifths (82%) of firms employing up to 49 staff paying for a Christmas party, while 8% provide a gift. By contrast, only two-fifths (44%) of firms employing over 5,000 staff provide for a party and just 3% give a gift.

74% of organisations with 50-249 employees provide a Christmas party, and 13% of these employees will receive a gift such as a hamper or voucher.

65% of organisations with 250-999 employees provide a Christmas party, and 9% of these employees will receive a gift such as a hamper or voucher.

47% of organisations with 1000-4999 employees provide a Christmas party and 9% of these employees will receive a gift such as a hamper or voucher.

44% of organisations with 5000 employees provide a Christmas party and 3% of these employees will receive a gift such as a hamper or voucher