Employee Financial Wellness needs to be addressed
In today’s fast-paced society, employee stress and employee financial wellness has become a prevalent issue that businesses need to address. While mental health and wellbeing have received considerable attention, one factor has emerged as the leading cause of stress for many Australians – money. With financial pressures, inflation, and the rising cost of living, it’s no surprise that money concerns are taking their toll on employees across the nation.
46% of Australians are living paycheck to paycheck
Financial analysts estimate that over 46% of Australians are living from paycheck to paycheck, with no financial fallback (1). This means that approximately 5.9 million Australians would be in deep trouble if they suddenly lost their jobs. They depend solely on their monthly income to meet their financial obligations.
Furthermore, a staggering 60% of Australians do not believe they will ever achieve financial security, adding to their anxiety and worries about the future. This is despite the fact that more than three-quarters of Australians (77%) do consider financial security as one of their top goals. (2)
Amidst a challenging economic environment, employers may not always be able to solve this issue with pay raises for all their workers. However, there are still meaningful ways in which companies can support their employees’ financial wellbeing and help with employee stress. One approach is through financial coaching, where employees can seek guidance and advice on managing their finances effectively. This can help them develop better money management skills and alleviate the stress associated with financial uncertainty.
Another avenue for support is implementing programs that encourage regular saving can empower individuals to build an emergency fund, providing them with a safety net during unexpected financial setbacks. Additionally, considering flexible wage options, such as allowing employees to choose when they receive their salary, can provide them with more control over their finances. This flexibility can help employees budget effectively and reduce financial stress.
Employee stress related to money affects turnover
Statistics reveal that employee stress related to money has become a pressing issue in Australia. With the country experiencing its highest job vacancy rate since 1970, it is crucial for employers to offer adequate support to retain their talented workforce. Failure to do so can result in increased turnover rates, with some industries already reporting turnover as high as 57.3%. The Australian Bureau of Statistics and Australian Human Resources Institute (AHRI) report the average turnover rate for staff in Australia is around 18%. (3)
The expectations surrounding jobs have evolved over the years, extending beyond simply being a source of income. Jobs play a significant role in fulfilling not only our basic needs but also our psychological needs. In line with Maslow’s hierarchy of needs, individuals expect their jobs to provide more than just financial security; they seek a sense of belonging, esteem, and the opportunity to reach their full potential.
Employee Stress affects organisations
The impact of financial stress on employees impacts on an organisation. Stressed employees are more likely to experience decreased productivity, lowered engagement, and increased absenteeism. By addressing the issue of employee stress related to money, businesses can demonstrate their commitment to their employees’ overall wellbeing and create a positive work environment.
In conclusion, while mental health and wellbeing have taken center stage in recent times, it is crucial not to overlook the impact of financial stress on employees. Money has emerged as the leading cause of stress for many Australians, affecting their overall wellbeing and job satisfaction. Employers can support their employees’ financial wellbeing through initiatives such as financial coaching, digital budgeting solutions and with flexible payroll. By addressing employee stress related to money, businesses can foster a happier and more productive workforce.
Sources:
(1) Most Australians Living Paycheck To Paycheck, Survey Shows – Traders Bible
(2) https://www.news.com.au/finance/money/australians-share-their-life-goals-and-money-sits-at-the-top/news-story/7b067cbfe7f8723217cd1c362ecb2086
(3) https://www.ahri.com.au/wp-content/uploads/turnover-and-retention-report_final.pdf