Paul Barrett, Head of Wellbeing at the Bank Workers Charity a wellbeing campaign champion member, calls on business to focus on employee financial wellbeing alongside other wellbeing considerations. Paul is an occupational psychologist with over 25 years’ experience in the employee wellbeing field.
One aspect of wellbeing that features far less prominently in organisational wellbeing strategies is financial education and money management. This appears counter-intuitive given the important role money plays in all our lives. The likely reason is that people are as reluctant to talk about money problems, as historically they have been, to talk about their mental health. So if these concerns aren’t being voiced, then they probably remain beneath the radar of organisations taking an interest in employee well-being. It’s invisibility as an issue isn’t helped by the fact that until recently, there has been little research into the impact of people’s financial circumstance on their overall wellbeing. That has changed. Over the last five years, there have been a wealth of studies establishing the links between people’s financial circumstances and their physical, psychological and social wellbeing. CAB found that 79% of those with debt worries were losing sleep most nights and 54% experienced physical symptoms. Another survey found that 42% of those seeking help with money problems needed to be prescribed medication to help them manage the stress.
When you consider how many people struggle with their finances ((ONS found that 16.5 million people have no money at all in their bank accounts), the scale of the problem becomes clear. With so many seriously preoccupied with their personal finances, you’d also expect there to be some spillover into the workplace. In fact, a number of recent studies have shown that when people are struggling financially the business suffers too.
What the research has also found is that employees would like their employers to actively support their financial well-being. The effects of poor financial wellbeing on the community are also seen on a daily basis at BWC. We see how money worries manifest themselves in poor mental health, psychological problems and a deterioration in their social wellbeing, as they become unable to afford to participate in some of the life-enhancing social interactions we all need.
There is a clear convergence of interest here because if employees become more financially literate and manage their money better, there will be a positive knock-on effect for the business and the wider society and everyone wins. This is what prompted us to publish our new white paper, Employee Financial wellbeing: Time to do more. It reviews the impact of poor financial wellbeing at work and highlights some of the innovative ways UK businesses have addressed the issue.
- Poor financial planning costs business 4% of their productivity1
- Employee money problems cost business £120bn a year 2
- 70% of employees waste one-fifth of their time at work worrying about money3
- 32% of employers are now prioritising financial education 4
At BWC, we feel strongly that businesses need to act and that financial wellbeing should be treated every bit as seriously as other wellbeing domains.
The Bank Workers Charity exists to help former and current bank workers and their families.
Visit the website for more information: The Bank Workers Charity>>
1 Barclays wealth report
2 CIPD community blogs
3 The C Suite
4 Employee Benefits