3 reasons why investing in employee financial wellbeing is good for business
If you were struggling financially, would you have anyone you could go to for support?
For many people, the answer is no.
With the Cost of Living Crisis squeezing everyone’s income it is not surprising that many households are struggling to access financial support. According to one recent survey, 30% of respondents said that they would not have anyone or any organisation they could go to to help them if they were in desperate financial need.
And the impact of this being felt nationwide.
The same research discovered that 64% of staff are stressed about their finances. There is no doubt that stress will be affecting every area of their life - including their work life.
These surprising statistics and others like them highlight why employers are starting to put employee financial wellbeing at the top of their welfare agenda.
But as well as being a morally good thing to do, investing in your staff’s financial wellbeing at work can yield significant benefits for businesses.
In this blog post, we will explore three key reasons why investing in employee financial wellbeing is good for business
1. Increased productivity and engagement
Financial stress can significantly impact an employee's productivity and engagement at work. When employees are burdened with financial worries, it can be challenging for them to focus on their tasks and responsibilities.
However, by investing in their financial wellbeing, employers can help alleviate this stress and create a more engaged workforce.
One way to support employees in this aspect is by offering financial wellbeing programmes as an employee benefit. These programmes normally take the form of online platforms that include resources and workshops on budgeting, saving, and investing, as well as one-on-one financial advice. They also include additional services such as opportunities for employees to borrow money to manage their financial challenges.
By providing employees with the tools and knowledge to manage their finances effectively, they can feel more confident and in control, leading to improved productivity and engagement.
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2. Enhanced Employee Loyalty and Retention
Secondly, providing resources that improve your employees’ financial welfare can really help improve retention.
Employee turnover can be a significant cost for businesses, both in terms of time and money. When looking for a cost to put against employee turnover, figures differ wildly. And this in itself is telling. Not only are you paying a fee to recruitment agencies, but you are having to onboard, train and bring an employee up to full productivity. The actual cost of staff turnover is unpredictable, and as such is hard to budget for.
However, when employees feel supported and valued by their employer, they are more likely to stay with the company for the long term. Investing in your employees' financial wellbeing demonstrates a genuine commitment to their overall welfare, which fosters loyalty and retention. This reduces turnover rates and associated costs. It could be that investing a small amount in a financial wellbeing programme saves you money in the long run.
3. Reduced absenteeism
Finally, financial wellbeing platforms improve employee health and wellbeing.
Financial stress can have a significant impact on an individual's overall health and wellbeing. It can lead to anxiety, depression, and even physical health issues, all of which can affect an employee's performance and attendance at work. According to research by Aegon, 4 million working days are lost each year as a result of financial stress.
By investing in employee financial wellbeing, organisations can positively influence their employees' overall health and wellbeing. This can help keep absenteeism down, which in turn can help keep productivity up.
Financial wellbeing: a win-win situation
Investing in employee financial wellbeing is a win-win situation for both you and your employees. By alleviating financial stress, you can expect increased productivity, higher engagement levels, and improved employee loyalty and retention.
As businesses strive to create a positive and supportive work environment, addressing the financial needs of employees should be a priority. By providing access to resources and support you can reap the numerous benefits of investing in your employees' financial wellbeing. Ultimately, by recognising and meeting their employees' financial needs, businesses can thrive and succeed in the long run.
