Much is always being made about worker productivity.
It is even a measure that economists use in assessing overall economic health.
It is no wonder then that companies are constantly looking for ways to make their employees more productive.
Productivity stems from a worker’s focus, health, and motivation to work for their company. A happy worker is a productive worker.
Companies are beginning to recognize that treating the employee right leads to more benefit for everyone.
One emerging factor in this effort is workplace financial wellness.
Financial Stress Undermines Productivity
Stress, in general, is known to have negative effects on focus, health, and quality of work.1 And nothing causes Americans more stress than their finances.2
Employees who are worried about finances tend to bring that stress into work with them. There, it can have an effect on everything. 24% of workers admit to being distracted by financial stress at work.
And of those, nearly 4 in 10 admit to losing three or more hours a week to that distraction.
And that is if they even show up to the job at all. 20% of workers have admitted skipping a day of work to deal with a financial problem.3
On top of that, the coronavirus pandemic has impacted both finances and stress levels.
Economic shutdowns and business closures were widespread. Most Americans feel their jobs and finances were negatively affected by COVID-19, and 14% say the pandemic has decreased their productivity at work.2
How to Help
What can be done to help stem this productivity crisis? Focusing on financial wellness in the workplace can be a major step.
The majority of Americans lack basic financial literacy.4 That makes it hard for them to make good decisions with their money.
Poor financial literacy can lead to poor spending habits, lack of savings, and excessive credit card use.5
Employers can help by providing education and assistance through workplace financial wellness programs.
These programs are not only helpful, they are in high demand. 40% of employees say they want help achieving financial security. That number doubles for those who admit to being stressed about money.3
Financial wellness programs can offer a wide variety of options to help employees. Education is one aspect, in addition to tools, advice, and assessments.
It’s not just workers who want financial wellness. More than half of employers readily admit that financial education boosts worker productivity.3
And ongoing support matters. 85% of financially healthy workers feel more productive at work.6 They are also more likely to be satisfied with their job and proud of their company.3
Building an Effective Program
In 2014, the Consumer Finance Protection Bureau (CFPB) issued a report detailing the impact financial wellness programs can have on worker productivity.
The report focuses a lot on the Great Recession's impact, but its implications apply today as we continue coping with the effects of the pandemic.
A 2020 poll by the American Psychology Association (APA) found that stress about the economy is approaching levels last seen in the 2008 recession.
The CFPB report makes recommendations for effective financial wellness programs, including:
- Leveraging technology
- Peer-to-Peer support
- Providing an ongoing benefit, not a one-time event
These elements of a wellness program help increase engagement, which is key to an effective program.
Gamification and technology, in particular, are useful for younger workers who may be the most in need of financial education. 57% of Millennial workers find it difficult to meet their monthly household expenses.
And they are the most likely to carry credit card debt.7
The CFPB report also points out that just a few hours of additional productivity a year or a one-day reduction in absenteeism would likely offset any per-person costs of running an employee financial wellness program.
Financial wellness is now recognized as an essential element in overall wellness. A person cannot be well in one area if they are unwell in another.
Businesses have many reasons to include financial wellness in their employee benefits packages – increased productivity, higher worker retention, and better job satisfaction.
Reducing financial stress can even help reduce healthcare costs for employers.3
The pandemic threw workplace wellness – physical and mental – into focus for many Americans.
Employers recognize that supporting their workforce does not simply mean a healthcare plan and 401(k).
Workplace wellness programs often include health assessments, exercise challenges, mental health breaks, and now, financial education and counseling.
1 - https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3160620
2 - https://www.apa.org/news/press/releases/stress/2020/report-october
3 - https://files.consumerfinance.gov/f/201408_cfpb_report_financial-wellness-at-work.pdf
4 - https://www.usfinancialcapability.org/results.php?region=US
5 - https://www.councilforeconed.org/2014/04/29/the-risk-of-financial-illiteracy/
6 - https://www.metlife.com/employee-benefit-trends/ebts-financial-wellness-2020/
7 - https://www.theexperience.work/wp-content/uploads/2018/06/pwc-2019-employee-wellness-survey.pdf