The financial well-being of your employees affects their health, their productivity and your bottom line.
A recent nationwide survey by Purchasing Power, Inc. found that:
Survey findings
- A high percentage of employees suffer significant financial stress. More than one in four workers surveyed (28%) find it hard to meet monthly household expenses and nearly half (44%) have less than $2,000 in emergency savings.
- They bring these concerns to the job. More than four in ten (44%) worry about personal finances during work hours.
- This stress leaves them less engaged at work and reduces productivity. Nearly three in ten employees (29%) deal with personal finances during work hours and almost half of these (46%) average two to three hours a week on money issues.
Purchasing Power Chief Revenue Officer Elizabeth Halkos offers recommendations to help workers maintain engagement and productivity at the office.
Recommendations
- Help them reduce debt by offering education, either in groups (through webinars or with a live speaker) or individually so that workers can learn about topics such as budgeting, intelligent use of credit and savings programs. A referral to a qualified credit counseling agency can provide useful follow-up.
- Give them access to responsible budgeting tools. Offering non-traditional voluntary benefits, such as employee purchase programs (which allow workers to acquire high-ticket items and educational services on a "forced saving" basis through payroll deduction) can help reduce their financial stress significantly.
- Encourage employees to participate in retirement programs such as a 401(k) plan. However, before workers do this, advise them to deal with debt and budgeting issues and tuck away a nest egg.
Our Benefits experts stand ready to help you ensure financial peace of mind for your workers — or ask an agent.
For related employer programs and solutions, see Big Brother Programs Insurance and Financial Institutions Real Estate Owned (REO) Property Insurance.
Frequently Asked Questions
How can employers identify if financial stress is affecting productivity?
Look for increased absenteeism, distracted employees, reduced output, or reports from managers about time spent on personal financial issues during work hours.
What types of education are most effective for reducing employee debt?
Practical sessions on budgeting, credit management, and emergency savings, delivered in short webinars or one-on-one counseling, tend to be most effective.
Are payroll-deduction purchase programs risky for employees?
When structured responsibly, payroll-deduction programs can help employees purchase needed items while enforcing disciplined saving, but employers should ensure clear terms and consumer protections.
How should an employer encourage retirement savings without increasing short-term financial strain?
Advise employees to address high-cost debt first and build a small emergency fund, then promote gradual retirement plan enrollment and employer match options.