IKEA Starts Employee Social Fund to Help Cash-Strapped Workers

The program is not a loan and helps employees deal with inflation.

November 14, 2022

STOCKHOLM—IKEA’s largest franchise group INGKA Group is launching a 10 million euro ($10 million) social fund and increased employee discounts to help its employees grapple with high cost of living, reports Reuters.

"Each INGKA Group country will give support to co-workers who may need 'one-off' financial assistance to, for example, pay electricity bills or for housing costs," the company said in a statement.

The social fund will be available in all 31 markets that INGKA does business in, and the money is not a loan, according to a company spokesperson. Each staff member is eligible for the financial assistance, but they have to apply, and the company will determine if employees receive money and how much on a case-by-case basis.

"The cost-of-living crisis is hitting many people hard. Some more than others," the company said. "We want to be able to support co-workers through this time, while balancing the needs of our business, always guided by our values."

INGKA Group controls 367 of the 422 IKEA stores and employs around 170,000 people. It plans to double its employee discount to 30%, and workers can use their discount at its store-in-store food markets and on more than 2,000 energy-saving products such as water saving taps, light bulbs, bedspreads and appliances.

The company spokesperson could not determine how many workers would seek financial assistance.

"Like many people and businesses around the world, we find ourselves in a new reality, triggered by the energy crisis and rising inflation," she said. “This extra support is meant to support co-workers faced with unforeseen costs they couldn’t possibly have planned for."

INGKA is also exploring additional compensation enhancements. The group has invested in increasing employee pay and benefits over the last several years, according to the spokesperson.

The annual inflation rate in Europe was 9.9% in September 2022, up from 9.1% in August, according to Eurostat. It was 3.4% a year ago. In September, the highest contribution to the annual euro area inflation rate came from energy (+4.19%), followed by food, alcohol and tobacco (+2.47%).

In the U.S., inflation slowed slightly last month, with the consumer-price index up 7.7% in October year over year, down from 8.2% in September and the four-decade high of 9.1% in June.

NACS has partnered with The Good Jobs Institute on how c-store operators can provide “good jobs,” which meet people’s basic needs and offer conditions for engagement and motivation. The Good Jobs Calculator, designed exclusively for NACS members and the convenience industry, allows retailers to use their own data and customized assumptions about the amount of improvement or uplift achievable, enabling executives to run scenarios on the bottom-line impact of a Good Jobs system.