Businesses are taking employee well-being seriously in 2020. Employers are encouraging staff to take frequent breaks, to maintain a healthy work-life balance and to discuss issues honestly and openly. All of these are effective methods of improving employee well-being, and a remarkable 80% of companies are predicted to be adopting a well-being strategy in 2020. However, there is one aspect of well-being that is often overlooked to the detriment of employees and businesses alike.
Holistic well-being means taking care of your employees’ physical, mental and financial health. When something is constantly preying on your employees’ minds, it will have a considerable impact on overall well-being. Financial well-being is something that unfortunately not enough employers are actively addressing, despite the fact that money worries are a huge source of stress for our workforce. Ongoing financial concerns are keeping our employees up at night, and it’s affecting how they perform and engage with their work during the day.
But should employers really be concerning themselves with private financial matters? Is it really our responsibility, as managers and business leaders, to step up and take action when it comes to poor financial well-being? Below, we’ll explore five reasons that illustrate exactly why businesses need to take this area of well-being seriously.
1. Poor financial well-being affects employee morale
There are many reasons why business leaders should care about employee morale. High morale leads to increased teamwork, improved office relationships, and increased levels of creativity, to name just a few. Furthermore, people with high levels of morale are more productive and loyal when compared to those who are generally unhappy and unsatisfied.
Financial anxiety can have a huge impact on mental health and well-being in general, as well as overall morale. Money worries can cause changes in mood, trouble sleeping and heightened stress. And when employees have been struggling with the same money worries for a prolonged period and see no end in sight, it won’t surprise you that they will have a bleak outlook.
When people are given the financial education and advice they need, they feel more financially stable and secure. It provides peace of mind, which will improve their outlook and morale whilst making them more appreciative of their employer who has actively supported them through difficult times and given them the tools they need to weather financial storms.
2. Poor financial well-being is linked to performance issues
We have some interesting (and persuasive) statistics to share with you. Did you know that while 88% of businesses believe their employees worry about money, only 30% think these money worries impact employee performance. In fact, 73% of employees say money worries impact them at work. Furthermore, according to Forbes, more than half of employees want their employers to help them with financial planning.
It makes sense when you think about it — financial worries cause stress. Fewer stresses result in increased focus, which means employees are more productive and work to a higher standard. When this is the case, companies perform better. Companies who underestimate the importance and impact of financial well-being and do nothing about it are likely to see increasing levels of stress within their organisation, leading to mistakes being made and a higher level of absenteeism.
3. Improving levels of financial well-being leads to an increase in employee engagement
A lot can be said about employee engagement — it’s a multi-faceted area. However, one thing we know is that employees are more likely to engage with their company and their work when they know their company is invested in them as a person. Employees want to know that they matter and that their thoughts, concerns, and well-being are being taken into account.
When a company goes the extra mile for its employees, they are going to feel more connected and engaged with that company. This of course, means they are more inclined to go the extra mile for their company. It’s all about discretionary effort, and has to come from both sides — the employee and the employer. Businesses can’t expect employees to care about the future of the company when the company doesn’t care about the future of the employee.
4. High levels of financial well-being can lead to reduced absenteeism
As we have previously mentioned, financial worries lead to stress. And we aren’t talking about short-term stress that can be shrugged off at the end of the work day — financial worries are often long-term. They can be mentally and emotionally exhausting, having an impact on our health, our bodies, and our relationships. We know that when stress reaches this level, absenteeism increases, which has a knock-on effect when it comes to productivity and performance.
Helping your employees by providing financial education and support will reduce stress, and provide peace of mind. This will ultimately improve health, whilst improving absenteeism and its associated costs.
5. Improved financial well-being results in lower levels of voluntary turnover
The reality is top-performing employees can have their pick of jobs today. We’re experiencing a war for talent that is causing a lot of concern for recruiters, and highly-skilled, capable employees are in high demand. We need to do what we can to retain them.
So what do employees really want from their companies? Again, this answer isn’t simple or straightforward. They want to be challenged. They want to be trained. They want recognition and reward, and they want their managers to be relatable, authentic, and motivational; most employees are looking for organisations that have their best interests at heart.
If your business is going to lengths to help your employees with their financial well-being, this demonstrates that they are valued. They are being treated well and provided with the tools they need to achieve their financial goals. Knowing this, they are unlikely to jump ship for a competitor who may not care for its employees in the way your company clearly does.