According to research by Close Brothers Asset Management, almost two-fifths (37 per cent) of employers they surveyed do not view a financial wellbeing strategy for staff a priority.
The Financial Wellbeing Index 2019 Reports, surveyed 1,003 employers that have over 200 or more staff, resulting in 5,003 employees across the businesses. Out of the 1,003 employers surveyed, 24 per cent do not perceive the value within establishing a strategy.
According to this survey, UK more than three quarters (77 per cent) of employees state that money worries impact their performance at work, resulting in a vast number of employees suffering from money worries (94 per cent).
The Close Brothers’ Financial Wellbeing Index analyses seven key areas of financial health and the relationship to UK employees, revealing the average score for UK employees to be 53.6 out of 100. The seven areas of financial wellbeing include planning, budgeting, savings, protection, investments, properties and mortgages, retirement planning, and tax. The lowest scoring areas among UK employees are protection (42.5), budgeting and planning (48.8) and tax (48.5).
Poor financial wellbeing holds a significant impact on employees and the workplace, revealed by the index. When evaluating specific groups within the workplace, money worries affects 87 per cent of millennials and 72 per cent of those age 35-54 whilst at work. Respondents aged over 55 report that they suffer the least, yet still almost half (47 per cent) still worry about money whilst at work.
With this in mind, organisations witness the effects through reduced productivity (22 per cent), loss of talent (22 per cent), higher short-term and long-term absences (19 per cent), reduction in retirees (17 per cent); and higher healthcare costs (13 per cent).
Alongside reward and pension schemes, the other most popular benefits to improve employee financial wellbeing are vouchers to assist with day-to-day expenditure (17 per cent), financial advice (13 per cent), retirement seminars (12 per cent), employee assistance programmes (12 per cent) and workplace loans (six per cent). Yet reinvestment within financial wellbeing and the fiscal health of employees has not currently been established as high on the agenda of employers.
Jeanette Makings, Head of Financial Education at Close Brothers, said:
“Employers are perfectly placed to play a significant role in making a difference to the UK’s financial health. Their reward and benefits help fund employees’ lifestyles; employers can reach large numbers of people with communications that are trusted; and employers can procure benefits and financial education, advice and investment solutions to help their employees improve their financial wellbeing.
“Yet despite the growing awareness of the need for workplace financial wellbeing, organisations seem to be struggling to find clarity, transparency, and meaningful measurement on this issue.”