While employees struggled with their personal finances during the COVID-19 pandemic, a recent survey finds that the financial impact on organizations is even greater.
According to results from BrightPlan’s annual Wellness Barometer Survey, financially stressed employees reported an average of 15.3 hours of reduced productivity and engagement each week, leading to an estimated $4.7 billion loss per week for employers due to worsening employee financial health.
Employees did take steps during the pandemic to reduce their financial stress. According to the findings, 56% contributed more to retirement savings and 64% feel comfortable enough with their finances to plan a post-pandemic splurge.
And while governments and other institutions struggled with the pandemic response, the survey reveals that employees gave companies high marks for their pandemic response, particularly human resources, where 93% of employees reporting their trust in HR has increased or stayed the same.
The findings also show, however, that the pandemic hit some groups of employees harder than others both mentally and financially, which exacerbated existing gaps. For example, women and people of color reported that their mental health, engagement at work, and work/life balance worsened more than other groups:
- Worsened mental health: women 37% vs. men 24%, people of color 35% vs. white 28%.
- Lower engagement at work: women 26% vs. men 20%, people of color 30% vs. white 21%.
- Worsened work/life balance: women 24% vs. men 19%, people of color 27% vs. white 20%.
Blacks are also more likely to say that their emergency savings decreased during the pandemic (65% of black vs. 54% of white, 46% of Hispanic and 35% of Asian).
Consequently, financial wellness is top of mind for employees and employers, especially in a post-COVID workplace. In fact, the pandemic triggered 81% of employees to reassess their financial situation and 94% of HR professionals say employers need to make major benefits changes to keep employees satisfied and productive, with wellness topping the list.
Additionally, most employees want support and guidance from their employers on personal finances, not only for retirement and financial education, but also financial planning, investing and day-to-day money management, the study notes. Financial resources employees want from employers include:
- financial education (82%);
- tools for investing (82%);
- access to a financial professional (78%); and
- unbiased money resources (70%).
Employees also reported that improved benefits would motivate them in many ways, confirming findings that supporting employees can directly boost the bottom line, the study notes. More than 9 in 10 (93%) say access to enhanced employer-provided benefits would have a positive impact.
“It’s imperative that employers make holistic financial wellness benefits available to all their employees, as they not only impact employee engagement and well-being, but the business success of companies and the economy at large,” says Marthin De Beer, founder and CEO of BrightPlan. “The data makes it clear that as we move into a post-COVID work environment, companies need to continue to invest in breakthrough solutions to help reduce employee stress, engage their workforce and bridge the $5B gap,” he adds.
CITE Research conducted the survey on behalf of BrightPlan among 1,500 knowledge workers at companies with 1,000 or more employees in the U.S. between April and May 2021. This included a mix of HR leaders and employees in various industries including technology, healthcare, manufacturing and energy.