Employee financial stress is a growing concern for most employers and employees. Employee financial stress not only impacts individual employees, but such stress on employees is also a noteworthy expense to employers. The company experiences Employee financial stress in the form of lost productivity, absenteeism and a lack of focus while on the job. John Hancock’s Financial Stress Survey reveals how employees financial stress can cost an employer upwards of $2,000 per employee per year. That’s an amount, significant for employers to take the expense seriously.
Employers should take note of their workers’ money stressors. When it is possible an employer should consider offering financial literacy programs and wellness support functions to help all employees. These programs can help employers reduce internal cost related to employee financial stress on employees. Taking these actions can result in a happier and fiscally healthy workforce.
Willis Towers Watson (WTW) studied the impact of employee financial stress in the workplace. The firm’s 2017-2018 Global Benefits Attitude Survey demonstrates a correlation between employees’ money concerns and workplace engagement, on-the-job performance, and absenteeism. The study reveals that employees who are struggling financially:
- Have 41% more work-time-lost, due to absence than their peers;
- Have lower engagement at work than their financially sound peers (29% vs. 51%); and
- Have less productivity than peers without financial stress (5% vs. 32%).
The study conducted by WTW ranked employee financial stress as being at levels of high, medium and low. The firm also looked at the relationship between employee financial stress and lost work time in categories such as non-pregnancy-related disability leave, sick days and unpaid leave. Highly stressed employees took 1.75 absence days to everyone full absence day that was taken by employees at a low-stress level.
Employee financial stress is a topic which employers should be monitoring. According to WTW, there is no one-size-fits-all solution to alleviating employee financial stress in the workplace. The make-up of an employee cohort, including life stage, education and income level, all contribute to how employers should approach building the financial well-being and confidence levels of a workforce. When considering any group, an individuals’ values, wants and needs to differ by generations. It is important for employers to tailor benefits to individual generations precisely for this reason.
As a preliminary step in addressing employee financial stress, WTW suggests employers assess the level of employee financial stress among an entire workforce and decide which financial stressors are of the higher concerns. Employers who understand and address employee financial stress in the workplace will gain a competitive advantage by increasing productivity and reducing absenteeism. This should reduce the costs associated with employee financial stress and be a win-win outcome for employers and employees.