Many employees are struggling to break the taboo of talking about their financial situation which is having a significant impact on their mental health, according to the 2019 Mental Health at Work report, published by Business in the Community, the Prince’s Responsible Business Network, in Partnership with Mercer Marsh Benefits.
Out of 4000 people surveyed, 21% of employees say they struggle to make ends meet financially, a number highest among18-29 year olds (26%) and women (23%), compared to 19% of men. More than a third (34%) say that they spend more money when they are feeling down. This again affects the youngest employees the most, with 44% of 18-29 year olds agreeing that they do this compared to just 28% of those in their 50s.
The principle of good work – employment that offers security, rights and a fair income, opportunity for progression and a supportive and inclusive environment – is key for employers wanting to address these challenges. Employee benefits can be an effective tool to improve the working lives of all your employees.
Business in the Community’s new toolkit, published today in partnership with Salary Finance provides guidance for HR teams to create an employee benefits package that improves the financial wellbeing of all workers.
Recommendations from the toolkit include:
- Engage senior leaders – Make the case for change in your business. It is important for senior leaders to understand the lived experiences of people who may be struggling within your workforce, as well as the potential impact of poor financial wellbeing on business performance.
- Identify the needs of low earners – While an employer knows who within their business is on low pay, they are unlikely to know their total household income, whether they’re in debt or struggling with childcare, or whether they are working one or two other roles (high paid or otherwise).
- Promote culture changes to make it ok to talk about money. -As with mental health we need to foster environments where it is ok to not be ok financially. Making changes to the culture of your business will enable other changes around financial wellbeing to be more effective. Invest in internal communications which raise the importance of talking about money, encouraging business leaders and management to share their own experiences and lead by example.
The business case for better financial wellbeing
When employees are struggling financially, the impact is felt on engagement and productivity. Research from Salary Finance has found that productivity lost due to financial concerns equates to 9-13% of total salary costs, and employees worried about money are 50% more likely to be looking for another job (Salary Finance 2019).
Nicola Inge, employment campaign director at Business in the Community, said:
“Employers need to create the kind of environment that break down the barriers around people talking about money to help all their employees.
“We need more employers to take a different approach to their employee benefits packages to make sure that they are meeting the needs of their whole workforce and getting the most value from the benefits they offer.”
Dhiren Master, global insights director, Salary Finance said:
“Our research shows that in the UK today, people are more stressed about money than their health, career and relationships. This leads to low financial wellbeing, which directly correlates with poor mental health, that in turn impacts significantly on all areas of people’s lives. Therefore, the enormous importance of providing a support system to help employees navigate their money journey can appear overwhelming.
“But it doesn’t need to be. People who have low financial wellbeing don’t need to be told what they need to do. They need practical support that will enable them to get out of the situation they are in.
“We believe there is a critical and unique role that every employer can play. Employers that put wellbeing at the heart of their business objectives and work collaboratively with their employees will see a happier, healthier and more productive workforce. This issue will not go away on its own and the time for employers to act is now.”