For the first time since records began, UK households are more likely to be borrowers that savers, according to figures by the Office for National Statistics. This in itself should be reason enough to realise how integral it is for businesses to understand the impact that financial concerns can have on employee mental and physical wellbeing.
Be it the stress caused by pay levels, the absence of employee benefits or the lack of financial awareness, it can affect work performance and employee satisfaction drastically.
Similarly, the perception that employee contributions are not being recognised can have a huge impact on their self-esteem, health and productivity. The issue is real and we must do something about it.
Unlocking the human potential
4.1 million people in the UK are in serious financial difficulty, falling behind in bills and credit card payments with 25- to 34-year-olds most indebted, according to an FCA survey last year.
An obvious solution would be to pay workers more, but dig deeper into the matter and you’ll notice that that’s not necessarily which will improve employees’ situation in the long-term, nor will it necessarily help their self-esteem, health and productivity.
As some economists argue, labour market forces like technology and globalisation shift demand away from low- and middle-wage jobs. This pushes wages down and consequently makes employees suffer, impacting their overall health and wellbeing.
If that’s the case, surely employee training and development is a far better approach to the problem. It helps businesses deal with their own challenges whilst supporting workers by preparing them for a safer future and career.
Why are employers not choosing these benefits more often?
As employers, we often forget how stressful an employee’s responsibilities outside work can be. With fixed schedules to work around, and last-minute requests from senior team members, an employee’s day can easily turn into an endless list of chores dictated by others around them.
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For example, analysis shows that around three million workers cope with full-time work whilst looking after relatives. Sometimes they’re having to do so with two jobs, in order to be able to cover all their expenses.
Having to juggle so many responsibilities all at once can damage employee wellbeing. There are only so many hours in a day and the burden of stress that comes with routinely pushing the bounds of what is humanly possible can bring about consequences.
Employers can enhance their employee value proposition in that respect by taking active steps to offer them more flexibility. For example, flexible working or rights to be paid short-term leave.
Similarly, they can offer perks to address emotional health issues that may come about as a result of this pressure, such as assistance programmes so that employees always have someone to speak to no matter the time of the day or issue at hand.
77% of companies offer no financial advice to their employees, while of those who do only 13% do so for free. Similarly, 55% of companies offer no financial education to their employees, while only 21% of those who do, offer it for free.
There is a genuine debate around the responsibility for financial awareness and whether it should fall on employees or employers but my belief is that both parties should be working in tandem as there are clear benefits for both. The stress caused by a lack of financial awareness can affect work performance.
Moreover, a CIPD commissioned research surveying UK employers concluded that one in ten employees find it hard to concentrate/make decisions at work due to money worries, and 19% have lost sleep worrying about money. All of these aspects impact productivity.
Without doubt, employees’ financial problems can quickly become employers’ problems as well. Therefore, employers should feel the need to step in and take action.
Recognising employee contributions
Employees respond to appreciation because it confirms their work is valued. When this happens, they feel appreciated and their satisfaction and productivity levels rise.
Forbes reports that employees who frequently receive recognition for their work score an average of 72% in overall wellbeing compared with the just under 54% for employees who received little or no recognition.
Recognition costs little or no money and can work wonders to improve staff morale and keep employees happy and engagement. Sometimes, it’s all employees are asking for, a little bit of love and attention.
From the traditional ‘good work’ email from your line manager, to the shout outs on your workplace social media platform – be this Skype, Workplace by Facebook or Slack, they are all important attributes of a quality workplace culture.
The idea behind all these tips is simple: the more you look after your workers, regardless of how much you’re able to pay them, the better environment you create, the healthier your employees will be and the more chances you have to grow and stay productive as a company.
Put simply, it narrows down to investing more in your people.