Wellbeing Week 2 draws to a close on the Juggle Blog. We’ll have one more Pub Quiz question for you on Friday afternoon then it’s back to regular broadcasts.
There’s more to wellbeing than just the physical, that much is obvious. But mental wellbeing goes a long way beyond simply coping with stress. Many mental health issues are at heart a case of worrying too much, or worrying about things we cannot change. But it is OK to worry about things; some things deserve to be worried about. And addressing problems – when you can – will do as much for your mental health as a hundred meditation sessions.
So let’s talk about financial wellbeing. In a recent survey nearly 90% of businesses included had concerns about their employees financial status (there’s a societal question to be asked here, but we’ll save it for another article). However, less than half of those same companies had any sort of programme in place to aid employees with their financial wellbeing.
- More than one in ten UK employees think that they are financially ‘slipping’ – struggling to make ends meet, spending more than they earn or having to use short-term borrowing solutions (which are always expensive).
- Almost two thirds of people at work in the UK are financially ‘balancing’ – making ends meet, but spending basically all of their earnings on just maintaining in the present, with no money saved for the future.
- Nearly half of employees actively worry about their finances (CIPD has found that financial woes are the biggest source of stress for UK employees), with 20% saying they sometimes struggle to sleep because of money worries.
- 40% of people have only about a month’s worth of savings to tide them over. Nearly half of the people working in the UK think that an unplanned emergency expense of just £500 would have serious consequences – perhaps beyond their ability to handle alone.
Why should businesses care?
A fair question, although it’s tough not to imagine some stereotypical fat cat corporate executive when you ask it, perhaps smoking a cigar or twirling and evil moustache. “I ain’t runnin’ a charity here,” they might say, and they’re correct, they aren’t. But there’s a solid business case for caring about your employees’ financial wellbeing alongside their physical health.
Any sort of worry affects productivity and therefore the bottom line. And worry isn’t something you can switch off when you walk through the door at 8:55. 1 in 10 UK workers are secretly agonising about their finances most of the time, and 20% of employees surveyed think that their financial situation negatively affects their work. A third say that they would move to a company that puts financial wellbeing as a priority (the vast majority of employees say that their employer either does nothing to guide them to better financial wellbeing or not nearly enough). Money worries also contribute to absences and presenteeism. The FCA estimates that in total, financial stress costs the UK economy £121 billion and 18 million working hours in time off work each year.
There’s also a major disconnect going on here. Businesses think that they’re helping enough, employees disagree. The Barclays report states that 7 in 10 employers thought employees “felt their organisation is concerned about their financial wellbeing”… compared to 1 in 10 employees. This kind of disconnect is damaging. A company that misinterprets the key drivers of engagement is a company that’s courting disengagement, and disengagement leads to staff turnover and dramatically lowered productivity.
In short, if your employees really care about something, and you quite patently don’t, lowered productivity follows. Your business should care because its employees care.
Can’t we just get paid more?
Another excellent question! But… one that’s probably not just going to get answered in the affirmative. Although more than 75% of employees see earning a good wage as the key tenet of financial security, we’re unlikely to see a sudden net rise of wages any time soon. Before we get on to the other things businesses can do apart from simply paying people more, it’s worth noting the following:
- Many businesses still have lingering biases/prejudices that lead to inconsistencies in pay policy.
- Compensation value, fairness and consistency are rarely re-assessed, and are often dictated by recruitment needs or market forces rather than an honest discussion about a role’s responsibilities and importance.
- Employees are discouraged from talking about their wages and getting a broad picture of what everyone earns, which allows manipulation of both wages and advancement by employers.
- There are many, many reasons that businesses fail. We’re yet to see “overpaying junior employees” make any Top 10 lists.
What can businesses do to help with financial wellbeing?
This is one of those questions that has a thousand answers and just one. So before we get on to a (short) list of suggestions, we’ll put forward the one that incorporates and represents them all: care about it.
Every report we’ve seen says basically the following: this is a key problem, businesses know about it, the majority aren’t doing anything about it and a surprisingly high number are deluding themselves by thinking that their employees don’t notice or don’t care. So the best that a business can do is just… start. Start doing something. Include financial wellbeing as part of your overall wellbeing strategy (you do have one of those, right?) Implement any of the ideas below – which are taken from among the myriad suggestions in the reports we’ve linked to, there’s plenty more in those.
We’ve tailored our suggestions to apply to every type of business, from SMEs, to professional service sector staff, to large organisations with a variety of roles and compensation schemes.
- Create internal sources of help and advice for employees, or at the very least direct employees to the many external sources available. Explanation and direction to something like the Money Advice Service costs literally nothing. Government and non-profit services will be happy to create bespoke advice solutions for your firm – but you have to contact them first.
- Promote, explain and facilitate the many online calculators and digital tools. You can use these to help plan your budget, savings and pension.
- Work on empowering your employees to understand and take control of their pensions.
- Host financial education sessions to educate employees on particular financial topics, especially long-term financial planning. No idea what topics would be of most interest to your employees? Survey them and find out.
- Consistently assess the value of your compensation packages, asking yourself: is this fair reward for the work done? Is it free of bias or prejudice? Could it be more flexible to suit individual needs?
- If you have an HR department, make financial wellbeing one their structured goals and begin to collect data on employee lifecycles with the aim of improving it. If you run a small business, work with an employee champion and empower them to help deliver information and guidance sources to their peers.
At Juggle we vet the culture of our business partners, and that includes compensation packages. We have no interest in securing a bad fit for professionals (for one thing, we only get paid if the placement is successful long-term). And although we know that salaries ARE important, our focus on high-quality self-managed professionals has taught us that workplace wellbeing is about much more than one number.
The future of work – the one we know is coming – will increasingly value results over traditional structures like the 9-5. This means high-quality professionals will have an increasingly direct understanding of the value of their work, the reward it deserves and the type of wellbeing focus they need and rightly demand from their employers. Businesses that fail to recognise this are going to get left behind.