Why financial wellbeing matters
Just under half of HR professionals don’t believe that employees bring their financial worries to work. Perhaps they need to think again
When presented with an unexpected bill of £300, 23% of people would have no option but to borrow in order to pay that bill. That’s 11.8 million adults. Many would probably reach for their credit card.
According to the National Audit Office, spending on credit cards issued by high street banks reached £11.1 billion in July 2018. That’s up 8.1% of the previous year. When it comes to the under 34 age group, as many as 70% say they borrow regularly to cover their basic needs.
Some of these people are almost certain to be your employees. According to our own research, 45% of HR professionals wouldn’t expect an employee to bring their financial problems to HR. Hardly surprising as most employees would be more likely to discuss the issue with a friend or family member (52% say they have done so). This obviously has the potential to make the impact which financial concerns have in the workplace harder to identify. But those consequences are there – and they are having definitely having an impact on work performance.
Our 2018 DNA of Financial Wellbeing shows that overall 63% of staff have been affected in some way by financial worries in the previous 12 months. Worse news is that this has increased from 58% the previous year. Of that 63%, 35% feel stressed, 26% said they’d lost sleep, 20% felt depressed, and 10% said they struggled to focus while at work. These figures get worse for those in the 18-24 age group – where 41% said they felt stressed and 22% had lost sleep.
Perhaps it would be better for everyone if they did bring their financial concerns to HR?
In fact, employees would actually welcome support from employers to help them deal with financial issues. Our study shows that 55% would like help with understanding and managing their finances, so the appetite to be given the tools to take control is there. There are also plenty of external organisations who can help and support you to provide this, such as Step Change and Pay Plan, as clearly many working in HR don’t have the necessary skills to provide financial advice, with four in ten feeling they’re not equipped to do so, and almost half feeling it isn’t within their remit to do so.
That’s a pity, as above all the best thing you can do is to provide a supportive environment where employees can feel free to talk about their financial concerns and stop bottling these issues up until they start to have a serious impact on their health and attendance (10% of 25-34-year-olds, for example, have taken time off work due to financial worries). Having a non-judgemental manager or recognised support programme are excellent ways to start to tackle these issues before they become serious concerns. This also shows that you as an employer take financial wellbeing seriously, and that willingness to engage the issues and provide support will be welcomed by many.
Finally, it’s worth also looking again at employee benefits. When an unexpected bill could cause financial stress for such a significant number, having benefits which take away that stress – and knowing how to access them should you need them – is one way to ease those possible financial concerns. Whether that’s critical illness cover or such things as optical or dental insurance, these benefits can make a significant difference to the way that employees feel about their financial security.
This is the first of three articles in which we’ll explore a range of aspects about financial wellbeing - which we believe deserves to be far higher up the HR agenda. It’s clear that financial worries do have an impact in the workplace – and that can have a significant impact on employee and therefore business performance. But above all, being able to talk about it and share the issues it raises, can quickly make a difference. And that’s got to be good not just for the bottom line but for the overall happiness and engagement of a significant part of your workforce.
Heidi Allan is head of employee wellbeing at Neyber