Have you ever found your thoughts wandering in the middle of the day from what you’re supposed to be doing to thoughts around money and, more specifically, your financial state? I know I have more often than I would like to admit. Especially now, with student loan repayments starting, I bet your employees are also finding themselves more distracted at work on a daily basis. Financial stress is actually cited as one of the most prevalent sources of stress for Americans, according to the American Psychological Association (APA).
Financial stress is one of the top causes of stress for employees today. With rising costs of living and mounting debt, many employees spend work hours distracted by their financial worries. This impacts the individual's health and wellbeing and hurts workplace productivity and retention. There is a clear need for employers to address this issue through financial wellness programs.
Financial stress and job performance are linked a lot more than you might think, so let's explore what this may look like. The effects of stress in the workplace can lead to employees who are more likely to:
- Miss work or be late frequently due to preoccupation with financial matters
- Experience reduced work performance and output due to inability to focus
- Make errors in job duties due to distraction and lack of concentration
- Feel dissatisfied with their pay level despite poor productivity
- Waste work time obsessing over finances instead of working
- Ultimately quit their job due to finances, increasing turnover
Chronic financial stress can also have severe health consequences, including anxiety, depression, sleep disturbances, headaches, and a weakened immune system. Employees suffering from prolonged financial strain are also more prone to developing heart disease, hypertension, and mental health issues.
The impact of employee financial stress also translates into substantial costs for employers. Financially strained employees who are absent, distracted, error-prone, and unsatisfied with their pay contribute to larger organizational problems including:
- Declines in overall productivity and output
- Increases in mistakes and potential safety hazards
- Higher healthcare premiums due to stress-related illnesses
- Greater expenses for recruitment and retention due to turnover
- Lower engagement levels leading to poor customer satisfaction
According to PwC’s 2023 financial wellness survey, employees spend an average of 3+ hours per week stressed over finances instead of working. With numbers like this, it's clear that unresolved employee financial stress significantly hurts the bottom line.
To combat the effects of financial stress, forward-thinking companies are now offering financial wellness programs as an employee benefit. These programs incorporate:
- Financial education workshops and seminars on topics like budgeting, debt management, saving, and investing
- Access to individual financial counseling and coaching
- Online tools and resources for assessing financial health
- Company-matched savings and retirement accounts
- Student loan repayment assistance
-AI insights like our product, YML Plus offers, which shows you when you have duplicate charges, suspicious activity, etc. to keep you in the know
This focus on financial wellness at work demonstrates an employer's commitment to health and work-life balance. Employees appreciate the resources to improve their financial literacy and the sense of stability these programs promote. As a result, organizations find that financial wellness programs increase employee productivity, engagement, and loyalty while reducing stress and absenteeism.
As financial stress continues to mount for today's employees, implementing financial wellness programs has become essential for organizations to improve productivity, retain top talent, and demonstrate social responsibility. The benefits for both employees and employers make this a win-win.