2 min read
Globally, people are extremely worried about their financial situation. And who can blame them? Inflation and stress on supply chains are driving costs through the roof, and wages aren’t keeping pace. But why are there so many negative feelings toward money? Because financial wellbeing feels unattainable for many.
Our 2022 research revealed that 37% of earners around the world are struggling financially, living paycheck-to-paycheck. And this anxiety is increasing - 70% of people globally feel anxious about their financial situation - a staggering 55% year-on-year increase. The cost of living crisis is very real and isn’t going away any time soon.
It’s clear the impact that financial anxiety can have on employee wellbeing, but let’s not overlook the impact it can have on business too.
Here are three ways financial anxiety can impact your business:
1. Retention
Financially-stressed employees are more likely to be looking for a new job. Bearing in mind the high cost of turnover, including recruiting and training plus the loss of high-performers, employers should consider financial wellbeing a key part of their benefits strategy - ensuring to highlight programs and support available to help employees make their money go further.
PwC’s 2022 Financial Wellbeing research found that 76% of people said they’d be more attracted to another company that cared more about their financial wellbeing. Is your benefits program future-proofed to retain and support your people through the cost of living crisis?
2. Productivity
Research found that those with poor financial wellbeing are seven times more likely to be unproductive and eight times more likely to produce lower standards of work. If your people are distracted by money worries, their mind might not be on the task at hand.
An investment in your people’s financial wellbeing will allow them to focus on their own finances, and those of their family, before the worst effects are felt. This in turn will improve productivity and quality of work as employees' financial anxieties ease and a secure future seems attainable.
3. Engagement
Those with poor financial wellbeing are four times more likely to be completely disengaged with the business. In fact, research by AXA, found that 5% of individuals admit to having taken time off work in the past 12 months as a result of money worries.
We have discovered that people feel anxious about their financial futures, which is impacting employee engagement. But what if employers empowered them with the skills and knowledge to take control of their financial situation?
Financially empowered employees (who receive financial education and effectively communicated benefits) are 24% more likely to feel connected to their employer. The opportunity for employers to save the connection with their employees is there for the taking, the question is: if not now, when?
View our latest infographic to dig into the data, and better understand how to rebuild the employee-employer connection.