The United Nations Development Programme (UNDP) estimates that an additional 71 million people around the world face being pushed into poverty. The worst affected countries include Armenia and Uzbekistan in Central Asia; Burkina Faso, Ghana, Kenya, Rwanda and Sudan in sub-Saharan Africa; Haiti in Latin America; and Pakistan and Sri Lanka in South Asia.
And a May Ipsos poll for the World Economic Forum found one in four people struggling financially in 11 developed countries.
Co-ops are stepping up to help cushion the blow – and they have a number of tools at their disposal, from staff bonuses to price controls.
In Italy, where inflation has hit 8.4%, consumer co-op Nova is allocating a €200 (£174) bonus for 5,000 employees. NovaAeg, a company active in the electricity and gas sector that is owned by Nova Coop, has extended this bonus to its employees.
Meanwhile, Norwegian retailer Coop is introducing a price ceiling on 200 everyday products for the rest of the year, keeping them at the current level or lower.
“In a time of strong inflation, consumer-owned Coop has a responsibility to help maintain Norwegians’ purchasing power,” said Håvard Jensen, director of the iCoop Norway chain. “When our suppliers increased our purchase prices sharply with effect from 1 July, we withheld parts of the price increase from the consumer. We are now further contributing to contain inflation by introducing price caps.”
The measure also applies to discount chains Extra and Obs!, the supermarket chain Coop Mega and the convenience stores Coop Prix, Coop Marked and Matkroken.
“We have used our unique customer insight to select 200 popular everyday products within, among other things, fruit and vegetables, fresh produce, dinner and cold cuts,” added Jensen. “The list includes both Coop’s own brands and brands from our suppliers.”
A similar initiative was undertaken by retail co-op NTUC Fairprice in Singapore, which provided a special discount on Pasar Fresh Eggs (30s) in April. Between 25 May and 1 June the group also offered a special discount of 10% for four popular cooking oil products for a week. The retailer recently announced a wage structure to help increase the salaries of workers.
Similarly, in Turkey the official inflation rate exceeded 80% for the first time since 1998 in August, markets run by agricultural co-operatives started offering more than 30 items at discounted prices.
Around 1,400 stores operated by the Agricultural Credit Cooperatives across the country on Monday offered various items at discounted prices in August. Discounts were applied to a range of products, including meat, poultry, flour, sugar, rice, onions, sunflower oil, liquid soap, paper towels, diapers and some fruit. Discounts varied depending on brands.
In the UK, where inflation has climbed to its highest rate in 40 years, one in seven adults says they cannot afford to eat every day – an increase of 57% since January.
Retailers John Lewis and Waitrose, which belong to employee-owned John Lewis Partnership, are offering free food to all Partners and temporary workers from 3 October to 6 January to help with the cost of living. The two businesses will offer staff members working a four-hour shift one free meal – breakfast, lunch or dinner – depending on the time of day.
Those working an eight-hour shift can choose two meals. The meals offered will vary depending on the type of activity performed and the workplace. Those working in larger stores, head offices and distribution centres will have their meals in canteens. Long-distance lorry drivers would pre-order packed lunches and staff in smaller convenience stores would receive sandwiches or salads.
Some co-ops and mutuals are making direct payments to help their workers. Nationwide Building Society is giving more than 11,000 staff who earn £35,000 or less per year a £1,200 one-off payment. It also introduced a 4.5% pay rise for all staff earlier this year and raised the base salaries of 4,000 of its lowest paid workers by around 5% at the end of March.
In addition to providing financial support, Nationwide will offer cost-of-living training to all frontline staff.
CEO Debbie Crosbie said: “The months ahead will be worrying for many people and we’re always considering new ways to help our members. But rising prices affect our colleagues too and that’s why we’re providing this additional support.”
Other co-ops are making a difference by supporting vulnerable communities. Co-op Holidays, which is part of the Midcounties’ Co-op Travel Group, is working with charity Go Beyond to enable vulnerable children from across the UK have a getaway break. Over the past year the initiative benefited more than 760 children aged 8-15, who are facing serious challenges in their everyday lives, such as bereavement, abuse, bullying, poverty or being a carer for loved ones. The breaks include a mix of residential stays and day visits where children can have new experiences, learn skills or make new friends free of charge.
Co-op Holidays is also donating £1 per passenger to the charity for every holiday package booked. Over the past year, the travel group has made a £50,000 donation to help offset any impact of the coronavirus pandemic from holiday booking donations.
Co-op Holidays has pledged to donate a further £50,000 to the charity to mark their second year of the partnership.
Sara Dunham, chief officer of travel and leisure at Midcounties, said: “We’re thrilled to be partnering with Go Beyond for a second year. As a travel business, we recognise how important a break can be for your mental health, so it’s great to be able to provide these getaways for young people who face challenging situations
“Not only that, but as part of a co-operative, supporting our local communities is at the heart of everything we do. We’re so proud to be able to support Go Beyond thanks to the help of our holidaymakers and it’s great to see first-hand how we’re helping young people create ‘forever moments’, grow in confidence and make new friends.”
Such measures help, but the world is in this for the long haul. Economists warn that the cost of living crisis is likely to last until the second half of 2023. NielsenIQ estimates that UK consumers will add an additional £500 to their overall food spend this year while those in the US will add an additional $481 to their total grocery food bill.
According to NielsenIQ’s research, external pressures on consumers’ day-to-day spending differ around the world.
In some markets, inflation affects multiple categories while in others price increases are isolated to just a few categories.
While these trends continue, co-operatives will have an increasingly important role to play in meeting their members’ needs and helping communities cope with the cost of living crisis.