You may view your employee’s financial troubles as a topic best left at home, but given the impact on both their health and productivity, as an employer it’s worth paying attention to.
Financial stress has been shown to lead to mental and physical illness, with knock-on impacts for businesses in terms of productivity, sick leave and staff turnover.
And the problem is neither small nor isolated. Last year, as many as 2.8 million employees, or one in four Australian workers, was under financial stress.
Casual workers, single-parent families and women were most likely to suffer, although even those in the top salary bracket show an increase in financial stress levels.
What causes financial stress?
Financial stress occurs when a worker is unable to achieve what they regard as the most important aspects of their financial well-being.
According to a recent study by CIPD, these factors include:
- A wage sufficient enough to enjoy a reasonable lifestyle;
- Being able to save for the future;
- Being rewarded for efforts in a fair and consistent manner; and
- Being able to comfortably pay off existing debts.
In Australia, the most common reasons behind financial stress are bad debt (50% of stressed workers), the need to save for retirement (35%) and providing for their family (34%), according to AMP research.
What are the health implications?
Stress has been clearly linked to trouble sleeping, panic attacks, anxiety disorders, depression, drug and alcohol abuse, and eating disorders.
There is also evidence that stress is linked to lowered immunity, increased risk of cardiovascular disease and type 2 diabetes, and symptoms of Irritable Bowel Syndrome.
Not surprisingly then, 72% of Australians say that stress is having at least some impact on their physical health.
How does that affect you?
If a staff member is under financial stress and suffering ill-health as a result, they are less likely to work to the best of their ability.
In fact, each week financially stressed employees lose an average 6.9 hours of productive work and are absent 1.3 hours due to stress-related sickness.
As many as one in five workers also say they have lost sleep over money woes and one third admit to being less careful as result of tiredness, suggesting stressed workers are more likely to have costly workplace accidents.
Staff turnover is also higher, with staff who are already financially stressed more likely to resign for a more lucrative position.
All this means lower productivity, higher costs and ultimately lost revenue, for your business.
Each week financially stressed employees lose an average 6.9 hours of productive work and are absent 1.3 hours due to stress-related sickness.
What you can do about it
If you’re concerned about an employee’s financial stress levels and the impact they may be having on your business, Bees with Honey is here to help.
See our Latest Thinking section for financial education content and expert advice that will help your employees regain financial control and stay focused at work.