Dan Schawbel says in the midst of continuing economic uncertainty, employers need to pay more attention to their workers’ financial wellbeing.
As we plunge well into the second half of 2023, the continuing state of global economic uncertainty is affecting workers and business leaders alike.
In a survey conducted by my company, Workplace Intelligence, and BrightPlan, the vast majority of employees said they were concerned about high inflation, a potential recession, rising cost-of-living and market volatility.
On top of feeling anxious about these external economic conditions, 92 per cent of employees were stressed about their personal financial situation.
Nearly half said they had more debt than they could manage, and 35 per cent had no emergency savings or only enough for up to two months.
Financial worries are impacting the work people do, with around half reporting that their engagement and productivity had declined as a result.
Many workers are taking matters into their own hands. At least eight out of 10 said they were improving their financial habits or cutting expenses.
However, employees can’t turn things around on their own — and most leaders recognise this.
The vast majority of executives we surveyed believe that their organisation should provide guidance and tools to help their employees grow their wealth, improve their financial literacy, and manage their money on a day-to-day basis.
Here are three steps employers should take to address the poor state of workforce financial wellbeing.
Take a pulse check on your workforce.
As a first step, executives need to gain a more accurate understanding of their workforce.
This is critical, because our survey uncovered multiple disconnects between employees and business leaders.
For example, just nine per cent of employees said their financial situation was ‘excellent’, but leaders estimated that 26 per cent of their workforce had an ‘excellent’ financial situation.
Gathering this information doesn’t have to be difficult or time-consuming — an anonymous employee survey can provide an abundance of insights.
Leaders may also wish to hold meetings or town halls with employees to discuss in greater detail how people are feeling and where they’d appreciate more support.
Upgrade your financial wellness benefits.
One of our more concerning findings was that 74 per cent of employees were not satisfied with their financial benefits.
For example, workers said they’d like access to an emergency savings fund, debt management services, home ownership assistance, a financial advisor, and personal or home loans.
There’s certainly a price that comes with adding new financial benefits, but savvy employers recognise that the benefits far outweigh the costs.
Organisations should also consider the potential impact that a best-in-class financial benefits package can have on retention and talent attraction.
Boost benefits usage and awareness through better communication.
While adding new benefits will help move the needle on people’s financial wellbeing, this should go hand-in-hand with boosting communication efforts.
That’s because many workers simply don’t know what’s available to them.
This lack of awareness is likely driving low benefits usage, another pressing issue revealed by the survey.
Leaders who take the initiative around this will not only help their employees improve their financial situation, but they’ll also bolster their organisation’s effectiveness as an employer of choice.
In the face of widespread economic uncertainty, this proactive approach will be critical to ensuring continued success.
*Dan Schawbel is a bestselling author and Managing Partner of Workplace Intelligence, a research and advisory firm helping HR adapt to trends, drive performance and prepare for the future.
This article is part of his Workplace Intelligence Weekly series.
