With the cost-of-living crisis set to continue for the foreseeable future, supporting employees with their financial wellbeing must be a top priority for every employer, something that we recently explored in our latest report: Cost of Living Crisis: Financial Stress and Employee Wellbeing.
The findings are fascinating, revealing how financial stress is intrinsically linked to both employee wellbeing and productivity. For organisations, the moral and business case for supporting employees with their financial wellbeing (and wider wellbeing) have arguably never been greater. So here are some practical steps you can take to improve the financial wellbeing of your people.
Finances are the top cause of stress outside work
The report findings show that financial pressure is the most common cause of stress outside work. Our previous data showed relationships to be the leading external cause of employee stress, so the influence of financial stress on employee wellbeing is clearly growing.
Over a third of employees surveyed reported that financial pressure was a cause of stress – compared to just 27% for parenting and 11% for COVID-19.
Leaders must take specific steps to support employees experiencing financial stress and provide financial wellbeing coaching, either internally or through partnering with external wellbeing providers. There are also free external resources.
Financial stress takes its toll on mental health
The research also revealed a link between financial pressure and clinical symptoms of both anxiety and depression. At its most severe, professionals experiencing financial stress are more than twice as likely to experience thoughts of suicide or self-harm.
Employers must act right now – that's why I'm calling on all leaders to train their teams in mental health. By doing so, you can significantly increase the chances of struggling employees getting the help they need at the right time.
The case for a holistic approach to wellbeing
As well as mental health, our data revealed that financial stress is linked to many other areas of wellbeing – from sleep to stress, to productivity and beyond. And no two employees will experience financial stress the same way.
Leaders must develop and utilise a holistic approach to workplace wellbeing strategies. Rather than addressing financial wellbeing in silos, these strategies must encompass all areas of wellbeing and address the unique challenges experienced by each employee throughout the cost-of-living crisis and beyond.
The young are hit hardest
The cost-of-living crisis has not impacted everyone equally. Our data reveals that employees between the ages of 25-34 are more likely to experience financial stress compared to their older counterparts.
However, recent research by Aviva shows that younger employees are also more likely to seek and engage with financial wellbeing support. This means that younger employees represent a demographic where employers can generate significant impact with their financial wellbeing support.
Here, it's important to understand the pressures facing younger employees on a granular level by gathering and collating information on their financial wellbeing.
Turning insight into action
The picture that emerged from our data was one of a workforce under pressure – with financial stress straining both mental and physical health. Naturally, these strains on wellbeing will also affect productivity. Therefore, from both a moral and business standpoint, employers must act. By providing the right support at the right time we can make a difference.
Whether that's empowering our teams with financial expertise or committing to supporting all areas of wellbeing – we can support our teams at a time when they really need it.
Small steps will go a long way – both for our employees and our organisations.