Dive Brief:
- While 42% of U.S. employees said their financial status has improved in the last two years, nearly as many — 38% — report living paycheck to paycheck, according to the results of a Feb. 11 Willis Towers Watson poll.
- The report revealed 39% of workers couldn't come up with $3,000 if they faced an unexpected need within the next month. And 18% of workers who earn more than $100,000 a year live paycheck to paycheck. Seventy percent of respondents said they are saving less money for retirement than they should. Accordingly, nearly a third said money problems adversely impact their lives; among the 27% of respondents who said they struggle with money, 39% said "money concerns keep them from doing their best at work."
- "Financial health is not just about income. The impact of financial problems on employees' health and stress, even for those who aren't living paycheck to paycheck, is unmistakeable," Steve Nyce, WTW's senior economist, said in a media release. "No matter the source, financial stress has a negative impact on their lives, underscored by hampering their ability to perform effectively at work."
Dive Insight:
To keep employees on board, stress-free and productive, employers may need to come up with strategies for helping workers with financial problems. Many employers have expanded their well-being programs to include a financial component, but a Mercer study found that to attract and retain younger workers, a competitive base pay is needed.
Given the widespread nature of financial problems, well-being initiatives, in addition to fair pay in benefits, will likely help at least some workers. Most employers in a WorldatWork survey (70%) have chosen to help workers with their finances by expanding their financial well-being offerings with programming such as budgeting assistance, debt consolidation services and tuition assistance.
To see true effectiveness, however, employers may need to rethink their financial well-being strategies, Bob Armour, CMO at Jellyvision, said in a 2019 article for HR Dive. Some strategies include prioritizing financial benefits guidance, rebranding open enrollment as a yearly financial check-up and providing unbiased financial advice.
