5 Ways Poor Financial Wellbeing Affects Your Employees

Introduction

Financial stresses of UK citizens are becoming more than just personal problems – they are now posing a greater problem to businesses in the form of poor employee performance. 

Employees who are struggling with money problems have reported that they are less present and focused at work – with increase in sick days taken and also prone to job hopping – to get a higher salary each time. 

This is putting businesses in challenging situations – feeling the pressure to support employees financially in other forms than just a pay rise. 

Sure, a pay rise will fix the problem but it’s not sustainable nor is it the answer to helping your employees build financially sustainable plans for their future.

4 ways employees are affected by money worries 

1. Increased absenteeism

Employees suffering with financial stress are noted to be taking more time off work – due to anxiety and stress-related illnesses, or the need to manage these personal issues in their working hours. 

There is also a notable change when employees are present – their productivity is lower as they are distracted and focused on solving their personal challenges and just ‘getting through the day’ at work. 

Studies in the UK shows that 5.5 hours are lost each week per employee – up to 20 hours per month! This might be insignificant on an individual level, however for larger companies this loss in hours is being felt across the board – in profits, service levels and employee morale. 

2. Reduced decision-making ability

The effects of financial stress and the mental instability it poses can be deep rooted – often eroding self-confidence in individuals. 

Over time, this self-doubt and lack of confidence works its way into the workplace and reduces employees ability to step into decision making roles when needed.

77% of employees say that money worries impact their performance at work and within their teams. With only a quarter of the workforce functioning at normal capacity – businesses in the UK are feeling the strain of a half committed workforce. 

3. Higher employee turnover

Money talks – and employees are no longer loyal to employers just because of the friendly work culture or free pizza on a Friday. Organisations are reporting a highly competitive recruitment landscape at the moment – as fickle employees jump from role to role in the pursuit of a higher paycheck. 

Up to ￡30000 is lost with each employee needing to be replaced – a cost UK businesses cannot keep absorbing much into the future. .

4. Increased workplace conflict 

With ¾ of the workforce feeling the financial pinch – it is common to see increasingly strained relationships. This is especially true when pay disparities or incentives arise. 

Conflict also increases when employees are burnt out or feeling disengaged. Even with employers doing everything they can to support their employees and create a positive company culture – this often is not realistic and employers find themselves scratching their heads when employees report that they are unhappy. 

What employers can do about it

There is a simple answer to this complex problem: employers need to provide better financial support to their people. How, you ask? Enlist the services of a financial wellbeing provider who can provide guidance on the best solutions to implement and how to manage them all. 

Here are 4 things you should ask from a financial wellbeing provider: 

1. A holistic solution – complete with education resources, tech-driven money management tools, access to experts and support for every stage of life 
2. On-demand digital education resources which help build confidence and basic money management 
3. Enhance your current employee benefits strategy by offering cost savings schemes like pension salary sacrifice, childcare salary sacrifice, and tech scheme salary sacrifice. 
4. Tailored programmes such as debt management support, credit applications, mortgage planning and estate planning. 

Conclusion

The financial landscape doesn’t need to hit your business so hard. They are clever ways to support your people, making their lives less stressful and ultimately  happier at work. 

Check out Maji financial wellbeing to learn more about enlisting a financial wellbeing solution.