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Returning to Work: Tips and Strategies for a Smooth Transition

Returning to Work: Tips and Strategies for a Smooth Transition

In the wake of the pandemic, as the hum of daily routines gradually returns, many professionals find themselves at the crossroads of resuming office life or continuing with remote working. Navigating this transition can be both a challenge and an opportunity. Here, we explore strategies for returning back to work with ease and delve into the economic underpinnings supporting a more robust return to work process, while acknowledging the pivotal preferences of employees.

The Changing Landscape of Work

The Office for National Statistics (ONS) reports that the uptake of remote working has seen a substantial increase, with many employees enjoying the flexibility it offers. However, recent data from the Confederation of British Industry (CBI) and the British Chambers of Commerce suggests a notable shift, with large employers advocating a return to office-based work. This move is seen as essential for boosting collaboration, creativity, and overall productivity – factors that are crucial for economic growth.

For instance, financial giants like HSBC and top consultancy firms have been firm in their return to work policies, highlighting tangible benefits such as enhanced team dynamics and sustained employee development. The broader economic argument supports this view: having employees back in office hubs stimulates local economies, from the coffee shops to the public transport systems that thrive on commuter traffic.

Balancing Preferences and Economic Needs

Yet, it’s not just about economic imperatives. Employee preferences play a crucial role in shaping the future of work. Data reveals a significant number of employees still favour working from home, citing improved work-life balance as a primary reason - 8 in 10 employers have lost staff due to mandating return to work policies according to Forbes. The challenge for employers is to figure out how to incentivise workers to return to the office on their own accord, not through mandating or coerced policies that will see staff exit, but through progressive and proactive policies that aim to provide financial benefits outside of the clear social and career progression opportunities that being "present" in the workplace present.s

One compelling solution gaining traction is the enhancement of staff benefits to incentivise a return to work. According to a Towersgate Survey, employers had implemented measures such as more on-site socials (41%), free drinks and meals (40%) on-site wellbeing days (38%) or access to in-person counselling (38%) to encourage a return to office working. Others are including free commuter costs, onsite and paid for professional development opportunities and free meals in a bid to incentivise attendance. 

But of all these, the largest cost that working parents have to bear in London is childcare and conversely, if offered for free at a school on site or near by, would incentivise 90% of workers to return to the office on a full time basis. And employers can do so, without impacting their profit and loss account, via the Workplace nursery scheme

The Cost of Living Crisis in London

In London, the cost of full-time childcare for a child under two years old is a significant expense for families. As of 2024, the average cost of full-time nursery care in inner London was over £428 per week, which is over £22,256 a year, per child, from the post tax income of a working family. The median annual earnings for full-time employees in London were £47,455 in 2024, which means an average two-parent household with both parents earning the median salary, the combined annual gross income would be £94,910. After accounting for income tax and National Insurance contributions, the net household income would be approximately £70,000 to £75,000, depending on individual circumstances.

In broad strokes, that suggests that the cost of having just one child in full time day care would cost that average family 30% of their net household income. 

And that's before we factor in the cost of actually owning or renting a home in London. According to a report from The Telegraph published in August 2023, homeowners in London and the South East are spending nearly 50% of their income on mortgage repayments in London, where the costs of owning a home are almost 9.3 times the average regional earnings. Financial advisors often recommend that housing costs, including mortgage payments, should not exceed 28% to 35% of a household’s gross monthly income to maintain financial stability so families in London are under significant financial duress.

To recap on what that suggests for the combined costs of childcare and mortgage costs alone:

  • Median Gross Household Income: If both parents earn the median London salary (~£47,455 each), the combined gross household income would be £94,910, and net income (after tax and National Insurance) would be roughly £70,000 to £75,000.
  • Childcare Costs: 30% of net household income - £22,256 per year (~£428 per week) for a full-time nursery place for a child under two in London.
  • Mortgage Payments: ~49% of net household income on average - £34,300 to £36,750 per year
That suggests that working families are spending c. 75% to 85% of net household income on mortgages and childcare, leaving just 15% available for food, utilities and other essentials in life.  To put that in perspective, in order to cover your running costs as a household, a sustainable gross household income would likely need to be at least £120,000 to £140,000 per year. According to data from Trust for London, average gross household incomes vary across London’s boroughs. For instance, in Wandsworth, the average household income is £74,000, while in Barking and Dagenham, it is £46,000. This indicates that a £140,000 income is substantially higher than the average in these areas. 


The Financial Strain and Impact on Families

This financial strain is not without consequences. A report from the Greater London Authority discusses the declining number of primary school-age children in London, with forecasts predicting a continued drop by 52,000 primary school children by 2028. High living costs, exacerbated by childcare expenses, are driving families away from the city, impacting the social fabric and future workforce.

And the impact is being felt more broadly in changing socio-cultural and demographic trends. The United Kingdom is experiencing a notable demographic shift characterised by declining birth rates, an increase in single-person households, and escalating living costs. In 2023, the birth rate in England and Wales reached a record low of 1.44 children per woman, significantly below the replacement level of 2.1.  Concurrently, the number of individuals living alone has risen, with 8.4 million people, or 13% of all households, recorded in 2024; this figure is projected to increase to 10.7 million by 2039. These demographic trends, coupled with the rising cost of living—where 89% of adults have identified it as a significant concern—are contributing to a decrease in school enrollments. Consequently, educational institutions, particularly in urban areas like London, are facing closures due to dwindling student numbers, as we've seen above

More can and should be done - employers clearly have a vested interest in seeing more mature, working parents who often sit in senior and managerial level positions in their organisations remain close to the workplace. Experience can help steer and train younger workers, who are at risk of becoming the only personnel within the work environment should this trend continue. 

What Hatching Dragons does to help our Families Reduce Costs

Hatching Dragons Nursery is committed to supporting families in managing the financial demands of childcare through a variety of innovative discount and subsidy schemes:

  1. Workplace Nursery Scheme - an employee benefit in which your employer pays for childcare from your pre-tax income, reducing your PAYE and their employers NICs. We've saved some families over £10k on this measure alone. See further details on Enjoy Benefits, Yellownest, Kinsail and Mintago
  2. 15-30 Hours free Childcare - 15 or 30 hours of childcare 38 weeks / year are funded by the local authority for children aged 9 months to 3 for eligible families and for all 3-4 year olds. Check your eligibility here
  3. Universal Credit - 85% of your fees are repaid by Universal credit for qualifying families up to a cap of just over £1000 a month. See here for more information
  4. Student Childcare Grants - 85% of childcare costs are covered by Student Finance for full time students. Read more here
  5. Tax Free Childcare - HMRC will top up any contributions made by qualifying families to their childcare tax account online with a 20% payment, up to an annual contribution of £2000 a year. For more information, click here
  6. Public Sector Discounts - of up to 50% for those working in charities, the civil or public sector or government
  7. Referral Discounts - 5% off for 6 months for every family you recommend, uncapped by the number you do.
  8. Sibling Discounts - 5% off for any sibling that enrols
  9. Advanced Payment - up to 10% off for families who pay down in advance

And we allow many of these discounts and subsidies to be bundled together to maximise your savings with us

Why not book in a visit at one of our schools to discover how we can help you?

A Strategic Return to Work with Enhanced Benefits

By incorporating the workplace nursery scheme as part of the return to work process, employers can make a significant difference. This scheme allows working parents to deduct childcare costs directly from their salaries, thus reducing their taxable income, affecting huge savings in tax payable for both employer and employee, which at a time of increasing tax take by HMRC really needs to be a considered strategy for a company's workforce management. In turn, this financial relief can enable families to allocate more resources towards mortgages and living expenses, making it feasible for more families to remain in London. When combined with other measures, such as the 15-30 hours extended entitlement, and / or an employer who exercises their ability to leverage corporation tax deductible contributions towards the childcare providers delivering care for their teams,

Incentivising a return to office work through such schemes not only supports employees but also serves to stabilise the workforce within the city. This broader approach aligns with the government’s vision to revitalise urban centres and sustain economic vitality.

Refer your Employer Today

 

Practical Tips for a Smooth Transition

For those returning to work after a long absence, a smooth transition is key. Here are some practical strategies:

  1. Gradual Adjustment: Start with a hybrid model, combining office and remote work. This gradual shift can help ease the transition for both employees and employers.
  2. Open Communication: Engage in open dialogues with management about work preferences and any concerns regarding the return to work process. Transparency fosters trust and collaboration.
  3. Work-Life Balance: Leverage flexible working hours where possible to maintain a healthy work-life balance. This flexibility can alleviate stress and improve overall well-being.
  4. Childcare Solutions: Explore employer-supported childcare options. The workplace nursery scheme can be a game-changer for parents managing work and family commitments.
  5. Professional Development: Take advantage of training sessions and workshops offered by employers to enhance skills and career growth during the transition period.
  6. Health and Safety: Stay informed about health protocols and ensure that the workplace is adhering to necessary safety measures to protect all employees.

Looking Ahead: A Collaborative Approach

The future of work is undoubtedly evolving. While economic arguments for returning to the office are compelling, accommodating employee preferences through enhanced benefits is equally important. A collaborative approach, where employers and employees work together to find mutually beneficial solutions, will be paramount.

As we navigate this landscape, it's crucial to remember that returning back to work is not just about resuming old routines but about redefining and enhancing them for a more balanced, productive, and sustainable future. By embracing flexibility and innovation, both employers and employees can contribute to a thriving work environment that meets the demands of the modern world.

In conclusion, the journey of returning to work after a long absence is not just a logistical shift but an opportunity to reimagine the workplace. By addressing economic challenges, recognising employee preferences, and implementing supportive measures like the workplace nursery scheme, we can pave the way for a smoother, more fulfilling transition for all.