- Financial wellbeing
- 4 minute read
The financial pressure of the COVID-19 crisis can harm employees’ mental health and, consequently, their engagement. How can employers support their employees’ financial wellbeing during hard times?
It’s well understood that supporting your employees’ financial wellbeing is an effective way to strengthen employee engagement, secure talent and drive up productivity. When your people are suffering from financial stress, every aspect of their lives can be affected. Money worries are one of the single biggest causes of stress, leading to poor performance at work.
Our recent research, Changing Trends of Financial Wellbeing, found that, even before COVID-19, 42% of employees admitted to losing sleep as a result of money worries, and nearly 40% of employees felt distracted at work. Younger employees are especially vulnerable to financial stress, with 45% of those aged 18-24 having suffered mental health problems as a result of money worries.
COVID-19 has only made things worse. 46% of employees felt financially unprepared for the emergency. As employees use their savings to cover costs and have concerns over job security, it’s no surprise that 36% of employees now worry more about their financial health than before COVID-19.
Also, many people are using lockdown to reconsider their careers. One recent study suggested that 19% of people considering a career change are doing so as a result of poor treatment by their employer during lockdown.
These difficult times are an opportunity for employers to step up and proactively support their people. It’s a challenge, certainly considering that most businesses have had to drastically change the way they work and, for many, get used to managing employees remotely.
Here we explore some of the ways you can support your staff to reduce the impact of financial stress:
- Keep talking
Communication is key. Empower your managers to check in with their team regularly. Staying connected, especially if your people are working remotely, means it’s easier for them to recognise when a colleague is having problems. Upskill your managers with active listening skills to support productive conversations with employees. Every employee is different. Some may just want an understanding ear and to be heard to feel better - Remove financial shame
The only good thing about the pandemic is that it gives you an easy way in to raise the subject of financial wellbeing with your employees, if it’s not something already in your company culture. Acknowledging that the pandemic is a no-fault cause of financial stress will reduce the financial shame that many people can feel, and bring the issue into the open. - Champion financial preparedness
The financial shock of COVID-19 has changed the way employees think about money. In our research, 50% of workers have plans to enhance their financial preparedness, with around 25% already having made changes. Financial preparedness is a hot topic. Start having conversations and offering resources that will help your employees become more financially resilient.
Employers who provide resources for financial advice/ guidance during the coronavirus pandemic have proved popular. Around one in five (21%) say they are likely to use them, but this rises to 27% among those aged 25-34 and then to 38% of those aged 35-44. - Address job security
If you’re sure that your employees’ jobs are safe, tell them. If you’re not sure, be open and transparent about it. - Reduce non-financial sources of stress
Lockdown has highlighted potential new ways of working that could reduce non-financial stressors for your employees. Remote working, done well, means no commuting, more time with family or for hobbies, and a better work-life balance. Work with your employees to engineer new ways of working to reduce overall stress levels, post-pandemic. - Highlight the importance of self-care
Self-care isn’t a soft option. Self-care activities such as exercise, meditation, good nutrition and good sleep impact positively on mental and physical health. Self-care is especially important during times of extreme stress, such as COVID-19. Give your people the time and flexibility to attend to these most basic needs. - Give employees access to financial education resources
More and more, employees are looking for financial wellness as a workplace benefit, and financial education is a key part of your offer. Knowledge is power, so giving your staff access to COVID-19-specific financial resources that can help them manage their finances during the crisis will make them feel more in control and therefore less stressed.
COVID-19 is an opportunity for employers to step up to the challenge of improving their business outcomes by supporting the financial wellbeing of their staff through the crisis. The pandemic has increased employees’ levels of financial stress but it’s also engaged them more proactively in their own financial health, and brought financial issues into the open. It’s your chance to create and deploy a powerful financial wellness strategy that will keep your staff loyal and engaged.
Here at Close Brothers, we offer financial education services to organisations and employees at every stage of their career. To discover how you can improve financial education for employees in your business, request a call back today.