As many as 90% of employers now expect the financial worries of their employees to have an impact on productivity and, ultimately, their organisation’s bottom line.
Employees at smaller businesses are more likely to suffer from money-related stress than those at larger companies.
At SMEs with fewer than 500 staff, for example, 67% are likely to be worried about their personal finances, compared with 55% at businesses employing between 500 and 750 people.
Could this be part of the reason for the country’s productivity woes” For the last decade, the UK’s struggling productivity has been well documented. Study after study has emphasised how poorly Britain measures up compared to other advanced economies.
Last year, for example, the UK’s productivity measured both in terms of output per worker and hours worked ended up higher than only Japan and Canada, but was far lower than the US and its major European trading partners.
Employers in the UK are beginning to wake up to the fact that their company’s overall performance is intrinsically linked with the wellbeing of its workforce, including stress related to personal finances. FDs may have a bigger part to play in this now than ever before.
These findings are published in a new report from Neyber, the financial wellbeing company, looking at why finance directors are increasingly playing the crucial role of championing the financial wellbeing of workers at their organisations.
Revealing some alarming statistics about the impact financial worries are having on the wellbeing of workforces up and down the UK, the report suggests employers need to be doing more to educate staff on money matters and help improve their financial wellbeing.
Neyber’s data on the effect stress is having on employee wellbeing is particularly startling. At SMEs with less than 500 staff, 55% regularly lost sleep because of financial worries, whilst 44% admitted to feeling depressed because of it.
Some 67% of employees at firms this size claimed to have struggled to concentrate at work due to money-related stress, and 16% had even missed a day of work because of stress caused by poor financial wellbeing.
Although slightly improved, the statistics for larger SMEs those businesses employing between 500 and 750 staff were still a cause for concern.
Whilst only 18% of workers at these (slightly larger) companies said they?d lost sleep over their finances, 20% said their financial worries had made them feel depressed. Some 14% claimed to have struggled at work, and 12% admitted to taking sick days due to financial stress.
The rise in stress related to financial worry can be of little surprise when you consider how much personal debt Brits have accrued in recent years. According to data from the Bank of England, total UK household debt increased by 7% over the last five years, from £1,518bn in 2012 to £1,630bn last year.
Taking a closer look at those levels of household debt, it’s consumer credit and student debt that have increased the most (proportionally) over this period. In fact, rates of consumer credit, including credit card debt, have risen by 19% since 2012.
So, how should employers react to these statistics” And to what extent should the owners of fast-growing companies count on their FDs to help safeguard the financial wellbeing of their workforce
According to Neyber’s findings, 58% of company bosses would value employer-led support to help with the financial wellbeing of staff. With FDs increasingly assuming more influential roles at fast-growing SMEs, they could be perfectly placed to introduce such initiatives.
The signs are that some employers have already begun acknowledging the financial wellbeing of workers. The report showed that 44% of businesses currently offer staff some form of financial support and guidance, and a further 39% plan to do so in the next year.
Whilst 29% of firms already offer employees financial education, 42% intend to do so in the next 12 months. Meanwhile, 17% and 21% of employers respectively try to help workers access savings accounts and affordable loans, compared with 34% and 35% respectively that plan to do so in the year ahead.
Despite these encouraging figures, more needs to be done to help employees across the UK take back control over their money.
There’s now a growing body of evidence demonstrating that stress about finances contributes to poorer mental, physical and social wellbeing amongst workers, and it’s time for all employers to pay attention.
