WHITE PAPER: Financial Wellness
It’s Time to Tend to Your Employees’ Financial Health
July 29, 2022
In this article:
Financial well-being and your employees’ health
Entering into the third year of the COVID-19 pandemic, the lives of workers across the country have been disrupted in a number of ways. Employers have taken measures to reduce costs, including making layoffs, reducing salaries and cutting back on other benefits. This has resulted in a profound negative impact on both employers and employees, as several studies suggest that finances are the top cause of employee stress. According to the 2022 PwC Employee Financial Wellness Survey, 63% of full-time employees say their financial stress has increased since the start of the pandemic with younger employees making up the greatest percentage. Headlines about the virus are now being replaced with concerns over inflation, which has caused new financial challenges to employees.
Financial well-being can have a significant impact on mental and physical health. Employees who worry about their financial well-being may have a hard time being fully present at work. Employees may be experiencing financial difficulties that create anxiety, guilt and even fear in the workplace regardless of income level or financial education. These feelings are often hidden but can manifest themselves via stress, workplace distractions, decreased engagement, employee burnout or long-term mental and physical health concerns.
According to the Money and Mental Health Policy Institute, mental health problems can affect expenditures and the ability to save. Many people with mental health challenges report that their spending patterns and ability to make financial decisions change significantly, with a recent study showing 63% find it difficult to make financial decisions and 38% took out a loan that they would not otherwise have taken out.
Another recent study from the American Psychological Association revealed that stress about money is the highest recorded since 2015. 65% of adults noted money as a source of stress. The impact of the pandemic over the last few years has only exacerbated the issue for American workers.