Surging housing prices have led to several employees leaving capital cities, and as consequence, many employers have introduced staff housing benefits in order to attract and retain staff.
The rising cost of living being seen in several parts of the world at present has also resulted in soaring housing prices. A number of employees are now increasingly unable to afford living and working in capital cities such as London, Dublin and Amsterdam, which are all facing housing crises.
This has led to companies finding recruiting skilled talent much more difficult, without paying significantly higher wages. This is especially true for foreign workers, who are often not willing to leave their existing jobs and home country without a number of perks, which often includes paid housing.
Irish employers buy more housing for staff
Ireland’s housing crisis has been getting progressively worse over the past few months, with several Dublin companies experiencing dwindling employee numbers, as workers are forced to leave the capital due to rising costs.
According to Statista, in the second quarter of 2024, the average monthly rent in Dublin’s city centre was about €2,377. There were also only around 51,000 homes available for sale in Ireland in 2024, down from 63,000 in 2022.
As a result, companies such as Ryanair, Supermacs, Killarney Hotels, and Musgrave, amongst others, have all chosen to spend more on staff housing benefits in order to attract and retain staff.
Back in early 2024, Irish budget airline Ryanair announced that it had purchased 40 houses near Dublin Airport, intending to rent them to new cabin crew, amid Ireland’s rapidly worsening housing crisis.
This led to a significant backlash at the time, especially from politicians claiming that Ryanair had snatched up the vast majority of new-build houses, leaving other individual buyers with little to choose from.
However, the company’s chief executive officer (CEO), Michael O’Leary, reiterated that looking after its staff was one of the company’s key priorities and that there were still thousands of other newly built houses available for other residents.
Ryanair said in a statement, as reported by Business Insider: “In recent years the absence of affordable rental accommodation has been a major impediment to recruiting and training new Irish and European cabin crew members to Ryanair’s inflight team.”
“This accommodation, which is located one bus stop from Dublin Airport, will be rented at affordable rates to Ryanair cabin crew during their first year of employment,” it added.
Musgrave, another Irish company, currently has about 50 staff rental properties, while care-home group Windmill Healthcare has 28, with plans to buy even more. Since 2019, Killarney Hotels Collection has also provided subsidised staff housing.
However, this has also come at a significant cost, with staff housing expenses having reportedly cost Supermacs between €6m to €7m already, according to The Irish Times.
Ireland’s housing crisis has mainly resulted from chronic underinvestment in affordable and social housing by the government over the last few years. Housing construction activity has fallen significantly since the property and banking crisis in 2008.
London faces ongoing public sector recruitment crisis
London has been battling a public sector recruitment crisis for the last few years now, with hiring levels across healthcare, the police and teaching especially hard hit. This has mainly been because of higher rents in the capital, which have far outpaced wage increases in these sectors in the last few years.
In November 2024, the average monthly rent in London was approximately £2,151 (€2,569.46) according to HomeLet Rental Index. Zoopla estimates that the average house cost £267,500 (€319,534.10) in November 2024, with property prices being 1.9% higher than the same period in the previous year.
Sectors such as the police have also struggled to recover from the Metropolitan Police’s widespread selling of section housing, meant for younger officers, a few years back. This has led to housing for public sector employees being even more scarce.
According to City Hall data, London’s public sector pay has also lagged the UK average in the last few years, increasing only 14.9% since 2016, compared to the national average of 15.5%. In contrast, London’s private sector salaries have outstripped the national average, rising 17.4% since 2016.
Sam Gurney, the Trades Union Congress (TUC) regional secretary for London, said as reported by Morning Star: “It is not right that our key workers are being priced out of the capital and forced to find homes and jobs elsewhere.
“In the middle of a recruitment and retention crisis in essential services like education, health and social care, London can’t afford to lose any more skilled and experienced staff. Everyone deserves a decent standard of living and access to decent affordable housing.”
However, these recruitment woes have not been limited to London’s public sector, with several private sector companies also missing out on potential employees who choose to move to smaller cities with a lower cost of living.
Heather Powell, head of property at tax and accounting firm Blick Rothenberg, said back in August, as reported by LandlordZone: “Recruitment teams at major employers in London, especially in the South East, are reporting that graduates who had accepted places on training contracts with a September start are deciding instead to accept jobs in other cities, citing the cost of renting a home as a major factor.
“And even higher earners are deciding to move out of the region because the size, and quality of the home they can afford is significantly greater away from London.”
