UK workforce now spends half as much on client entertainment compared to the heyday of the 1960s, 70s and 80s
· On the 50th anniversary of the corporate credit card, new research finds the 1960s, 70s and 80s were the peak decades for employee expenses – with workers more frequently claiming on business travel, dinner and drinks than their counterparts today
· Corporate spending has evolved dramatically since 1968, when Barclaycard first introduced the corporate card to the UK, with the petty cash drawer now a distant memory in many organisations
· The expense management process itself has also become more formal, with a clear shift to self-service – almost two-thirds of today’s employees file their own expense claims compared to just over a third in the 1960s
· The 50th anniversary of the corporate card is another innovation milestone from Barclaycard, which introduced the UK’s first credit card in 1966, Chip and PIN transactions in 2003 and contactless payments in 2007
The 1960s, 70s and 80s were the heyday of workplace expenses, with a higher proportion of employees regularly claiming for client entertainment and business travel costs compared to today’s workforce.
New research from Barclaycard, which today marks the 50th anniversary of launching the corporate credit card in the UK, explores how spending habits have changed since the height of the ‘Mad Men’ era of business.
UK employees are now less likely to spend company money on entertaining clients than in decades past, with just 10 per cent saying that they often claim dinner at a restaurant with a client on their expenses. This is less than half the proportion who did so in the 1960s (34 per cent), 70s (27 per cent) and 80s (28 per cent), continuing a steady decline over the years.
Daytime schmoozing has also fallen out of favour, with just 13 per cent of today’s workforce claiming expenses for lunch at a restaurant, compared to 36 per cent of those in the 1970s and 37 per cent in the 80s.
Employees are also less likely to catch up with clients over drinks, with just seven per cent regularly footing the bill for a round – approximately a quarter of the proportion who say they did so in the 1980s (27 per cent).
A change of direction in corporate travel
Corporate travel spending hit a peak in the 1980s and 90s, with nearly half (48 per cent) of workers claiming for hotel accommodation in each decade. This is compared to a quarter (25 per cent) today. Airfare was also more frequently purchased in the 1990s and 2000s, claimed by 19 per cent of workers and down to just 12 per cent in 2018.
Technological shifts may have also driven changes in transport spending. 22 per cent of employees filed expenses for taxis hailed on the street in each decade from the 1980s to the 2000s, yet that has dropped to just 14 per cent in 2018. While the proportion of those spending company money on pre-booked taxis and cars was only at 8 per cent in the 1960s, the advent of apps may have boosted this figure to its current peak of 15 per cent.
Shift to self-service
The process of making purchases and claiming expenses has also been transformed. The biggest changes employees identified over the decades were: the process becoming more formal (36 per cent), the range of items eligible for expense claims narrowing (32 per cent), the introduction of the corporate card (14 per cent) and the disappearance of petty cash drawers for minor purchases (11 per cent).
There has also been a clear shift to self-service. 63 per cent of employees now file their own expense claims, compared to 38 per cent in the 1960s. One in five (21 per cent) workers also said that, 50 years ago, the office personal assistant processed their expenses – this is true for just 17 per cent of the workforce today.
Fit for the future?
One in ten (11 per cent) retired workers said that over the course of their career, the expense process became more digital. Today’s employees may see even bigger changes over the next 50 years, especially if they have their way with futuristic filing systems. Three in ten (30 per cent) say their ideal expense system would include an app that can both help them pay for business purchases and automatically complete the fields they need to claim their expenses. This was followed by an expense scanner that would take a picture of their receipts to automatically complete their paperwork (26 per cent).
Marc Pettican, Managing Director of Barclaycard Commercial Payments, said:
“Business spending has changed dramatically since Barclaycard introduced the first corporate credit card back in 1968. This was a major moment in the development of UK companies and how they managed because suddenly an entire generation of workers gained more flexibility in their day-to-day working lives.
“Fast forward 50 years and companies have become more complex and diverse, with very different needs. This is reflected in the range of expenses and the methods of claiming them that were popular then and now. Building on our rich heritage of payments innovation, we will continue to support businesses by introducing new methods of commercial payments, such as with virtual cards, to ensure they’re fit-for-purpose for another five decades.”
Where it all began, a brief history of Barclaycard’s innovation in payments
· 1966: Barclaycard launches the first UK credit card with a team of just 30 people headquartered in an old shoe and boot factory in Northampton. Barclaycard’s acquiring arm, which processes transactions, also gets started.
· 1968: Barclaycard introduces the UK’s first Company Credit Card to help businesses make payments and keep track of expenses among their staff.
· 1986: Barclaycard rolls out electronic card payment machines (PDQs) following the first deployment at a Miss Selfridge store in Brent Cross Shopping Centre, London.
· 1995: Barclaycard is the first UK credit card company to go online with Barclaycard Netlink. At first consumers were only able to pay utility bills, but by 1997 they could also check statements and settle their accounts with a debit card.
· 2003: Barclaycard rolls out Chip and PIN to over half of the adult population and almost 1,000 businesses in Northampton. An industry-wide rollout follows later that year.
· 2007: Barclaycard pioneers contactless payments in the UK with the OnePulse card, which can also be used on London’s transport network.
· 2012: Barclaycard is the first UK company to introduce wearable payment devices.
· 2014: Barclaycard worked with TfL on the first phase of introducing contactless to London’s tubes, trains buses and ferries by aiding the evolution of the yellow Oyster card readers to enable them to read contactless cards.
· 2015: Barclaycard creates the nation’s first payments fashion wearables through partnerships with TOPSHOP and Lyle & Scott.
· 2016: Barclaycard launches ‘Android Contactless Mobile’ and becomes the first financial services brand in the UK to allow customers to make contactless payments on their Android phone, by enabling high value contactless payments for up to £100 to be made without the need to use a card.
· Today: Barclaycard has 9.6 million consumer cardholders and more than 300,000 business customers in the UK.