Are you already fed up with 2012? The year has certainly started with a slew of bad news for employees. For those who commute, the hike in train fares means an average of 8% of their salaries is now eaten up by the journey to work, according to global management consulting firm Hay Group.

The Chartered Institute of Personnel and Development (CIPD) forecasts a drop of 120,000 people in work by the end of this year, bringing UK unemployment to 2.85 million (8.8%). Research by analyst Bersin & Associates shows the top business challenge for 2012 is reducing operating costs, cited by 42% of firms surveyed - and we all know what that really means.

Meanwhile, by last Wednesday (January 4), 53% of people in full-time employment admitted they had already spent all their disposable income for January [MyVoucherCodes survey].

Another CIPD report finds staff across all sectors readjusting pay expectations after a disappointing 2011. The CIPD’s Employee Attitudes to Pay report reveals that, in the year to November 2011, 48% of employees did not receive a pay rise and a further 5% saw their basic pay drop. Those lucky enough to get an increase typically gained a miserly 2.5% extra at a time when Retail Prices Index inflation was 5.2%.

This does have a major impact on The Grocer’s readers - people are spending less. Nearly three-quarters of survey respondents cut back on spending in the last six months of 2011 to make ends meet. More worryingly, some 57% say they will be cutting back on living expenses, such as food and fuel, in the coming six months.

Encouraging people to part with their money will be the marketing battle of 2012. But there is also something employers can do, and that is to make staff feel as positive as possible. Since the CIPD’s survey began in 2008, employees feel less valued, less proud of their employer and less motivated. They also say their employer does not communicate well with them. And only one in five believes their reward accurately reflects their performance, so why work harder?

Be more transparent about what you expect and how this connects to reward and recognition, and you can help staff understand why they have received a certain reward. Failure to do so will hit motivation and productivity in a year in which both of these will be sorely needed in business.