More than six in 10 (61%) senior HR executives have seen a rise in financial wellbeing issues affecting employee mental health and work performance, according to MetLife UK.
But these HR professionals expressed concern that they don't have a strong enough understanding of this area. Two-thirds (66%) said they need to know more about the link between financial wellbeing and mental health issues, and the same proportion said there needs to be more clarity around best practice for tackling financial wellbeing at work.
The research, which surveyed 200 UK HR professionals, found that there is widespread agreement that addressing financial wellbeing issues will bring business benefits. Nearly two thirds (64%) said that tackling financial stress will help boost productivity and engagement in their organisation, while 58% said that there is growing momentum to provide support.
Additionally, 60% of HR managers said they believe financial wellbeing advice should be part of employee assistance programmes (EAPs), aimed at helping address mental health issues.
The research coincides with the release of the ONS's Personal and economic well-being in the UK: April 2019 report, which revealed that in the year ending December 2018, 19.7% or about 10.3 million people in the UK reported high levels of anxiety around their finances, a proportion that has remained similar since 2014. It also found that people's perception of their financial situations has fallen by 0.3 since last quarter.
Jeanette Makings, head of financial education at Close Brothers, stressed the key role employers and HR should be playing here. “Worrying about money not only affects people at home, it also affects their productivity at work and is one of the biggest causes of stress and anxiety and so impacts mental health if unchecked," she said. "Almost three-quarters of people currently worry about their finances at work to the extent it impacts their individual wellbeing, and their performance in the workplace."
She added the importance of encouraging employees to build a financial safety net: "One of the causes of [anxiety around money] is that not enough people have enough of a buffer to call on for unexpected financial costs. As incomes are finally climbing above inflation, for many, there is an opportunity to revisit their saving plans, and build an ‘emergency fund’ of three to six months’ worth of monthly costs.
"Employers are very well placed to educate their employees on matters like this and the whole spectrum of financial wellbeing. Doing so will improve employees’ financial wellbeing, reduce their level of stress in the workplace, and fundamentally improve performance and retention. It’s a win-win.”
Researchers at MetLife UK defined financial wellbeing as a combination of factors. These were: being in control of your finances; having the capacity to withstand financial shocks; having confidence in the future; and having choices on how to spend and save.
“Financial wellbeing in the workplace is a growing issue for businesses, with organisations reporting a rise in concerns about the impact on mental health and company performance,” said Adrian Matthews, employee benefits director at MetLife UK.
Matthews added that while there is no quick fix to improving financial wellbeing, employers could benefit from a better understanding of the issue: “Companies appreciate they need to understand more about the issue so they can provide support for employees, but at the same time there is concern that there are no agreed best practice standards on how to implement financial wellbeing programmes.
“There is no magic solution to improving financial wellbeing in the workplace, but a well-designed employee benefits programme is a good place to start. The potential business benefits in terms of more productive employees are clear.”