Picking up the tab: Why you should care about financial wellbeing in the workplace

The cost-of-living crisis shows no sign of slowing down. Furthermore, the financial pressure on employees is growing by the day. As expenses rise, many people struggle to keep up, with the effects following them into work. The result? Stress, distraction, and a knock-on impact on performance.

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More companies are choosing to support financial wellbeing in the workplace for this reason. However, what does this really mean? How does it affect your business?

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What is financial wellbeing in the workplace?

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‍Financial wellbeing in the workplace refers to how confident and secure employees feel about their finances while at work. It includes their ability to manage money, meet regular expenses, plan for the future, and deal with unexpected costs — all without stress or fear.

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It also includes financial literacy — understanding spending, saving, borrowing, and planning long-term goals. When employees worry about bills, debt, or the rising cost of basics, their financial wellbeing drops. This situation can often drag their mental and physical wellbeing down with it.

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Further reading: How to support your employees’ financial wellbeing?

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What are the benefits of supporting employee financial wellbeing?‍

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In an ideal world, employees would have their ‘home life’ and financial situation separate from work. As we all know, however, workers are human beings, and can be severely affected by external factors, even when they’re doing their job. Their financial situation is one of these factors.

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With 34% of adults in the UK feeling anxious, 29% stressed, and 10% hopeless regarding their finances, this is a serious issue that needs to be addressed by employers, as their main income provider. Supporting your staff’s financial wellbeing has many advantages for the business.‍

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Engage your employees‍

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‍When someone’s worried about how they’ll pay rent, it’s hard to focus on anything else, especially work. According to PwC, 45% of employees dealing with financial stress spend time during the workday thinking about it. That’s nearly half of your workforce mentally checked out.

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A supportive financial wellbeing programme helps people feel more secure. It sends a clear message–you value them and are here to help. When employees feel supported, they engage better with their work and are less likely to burn out or mentally disconnect.

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Enhance productivity‍

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Rates of productivity continue to fall significantly around the world. Maintaining a productive workforce is a high priority, but it will only continue to decline without financial wellbeing. ‍

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According to the Financial Post, productivity losses linked to financial stress cost more than $40 billion in 2022. That number isn’t surprising when considering how money worries affect energy levels, focus, and decision-making.

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When staff take on extra jobs to make ends meet, they often arrive at work exhausted and less productive. Supporting financial wellbeing allows employees to focus on doing their best instead of scraping together enough to get by.

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Reduce turnover‍

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As the primary source of income, a job has a particular impact on an individual’s financial wellbeing. If they do not earn a living wage, or enough for them to live comfortably, the first thing they might change about their lives is their work. Understandably, low pay was the top reason for employees to leave for a new job, with 63% stating this as a reason.

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Turnover is a huge concern for businesses today, considering the high cost of replacing an employee. Not to mention, it causes disruption and impacts engagement.

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However, the turnover rate today stands at 47%. This makes it a pressing issue. ‍Offering fair pay and financial wellbeing support is one way to hold onto your team and avoid the cost of constant rehiring.

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Improve performance‍

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Your people are your performance. If they’re struggling, your results will too. Financial stress affects the mindset, physical health, time off, and productivity. 80% of employees believe that stress around their financial wellbeing negatively affects their performance at work. Nevertheless, it doesn’t end there.

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WebMD reports that low financial wellbeing is linked to sleep issues, high blood pressure, headaches, digestive trouble, and even heart problems. These issues lead to more sick days and reduced output. Absenteeism alone can cost between 2% and 16% of a person’s annual salary.

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Support your team’s financial wellbeing. You can help them bring their best to work more often and thoroughly.

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How Thrive supports financial wellbeing in the workplace

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Employees who feel secure and confident about their finances improve their engagement, productivity, and wellbeing.

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Thrive’s psychometric hiring assessments help businesses identify the right candidates and avoid costly mishires. We also offer a performance and development tool that gives insight into team strengths, gaps, and behaviours.

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These tools give you the data and direction to build stronger, more resilient teams. Create a workplace where financial wellbeing is part of the bigger picture.

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Want to learn how the Thrive platform can help you improve your employees’ financial wellbeing? Book a demo with us today.

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