Stress caused by financial worries is having an impact on employee productivity, according to PricewaterhouseCoopers’ (PwC) 2011 Financial Wellness Survey. Among U.S. workers, 29 percent of respondents said personal financial issues have been a distraction at work and 48 percent said they've handled their personal finances during work hours.
Being distracted by personal financial issues at work was highest among employees aged 35 to 44 (40 percent) and, surprisingly, those earning $100,000 or more (37 percent), showing that financial stress is not just an issue for young and low-income workers.
Overall, the survey found that:
• Almost half (49 percent) of working American adults find it difficult to meet their household expenses on time.
• Nearly one-quarter (24 percent) report using credit cards to buy monthly necessities because they couldn't afford them otherwise.
Primary financial concerns among American workers included:
• Not having sufficient emergency savings for unexpected expenses (25 percent of respondents).
• Not being able to meet monthly expenses (20 percent).
• Not being able to retire when they want to (18 percent).
Lost Hours Add Up
When employees' financial issues affect their performance at work, "these ‘lost hours’ can really add up and have a significant impact on an employer’s bottom line. Increased stress levels also may lead to higher health care costs and impact morale,” said Kent Allison, a partner in PwC’s financial education practice.
“Empowering employees with the information they need to become financially successful will result in a more engaged, stable and healthy workforce while potentially allowing employers to cut ineffective, costly programs,” Allison advised. He urged employers to take a more holistic approach to ensure that the broad needs and concerns of employees are met.
“Given the success of health wellness programs, organizations may want to take an approach similar to that which is used in addressing physical wellness,” added Nik Shah, a PWC principal. He recommended structuring financial wellness programs that:
• Provide employees with a confidential financial fitness assessment and direct them to appropriate resources and advice.
• Give employers an overview of employee issues by key demographics.
When employers have a better understanding of the financial challenges their employees are coping with, they can design proactive and targeted education and advice programs that address employee needs, Shah noted.
Financial Education – Stress = Improved Productivity, HR Magazine, June 2012
Assessing and Developing Employee Financial Competency, SHRM Templates and Tools, December 2010
Gen Y Workers, Under Financial Stress, Value Their Benefits, SHRM Online Benefits Discipline, December 2009
Address Financial Ills to Reduce Other Workplace Problems, SHRM Online Employee Relations Discipline, June 2008
SHRM Online Benefits Discipline