The impact of financial problems on workplace wellness is a “hidden epidemic” with serious risks for employers from lost productivity and relationships with customers, MetLife’s Rethinking Employee Financial Wellbeing Symposium was told. Contributor Dr Charlotte Duke, Head of the Behavioural Economics Team – London Economics.
The symposium heard more than half1 (55 percent) of employees with financial problems admit they achieve less at work than they would like while nearly two out of three (66 percent) of those with financial worries show signs of poor mental health.
But employers can address workplace mental health and financial wellness issues by adopting techniques from behavioural economics which do not need major investment but can deliver short-term and long-term business benefits.
The event delegates heard from leading behavioural economics experts Dr Charlotte Duke, head of the behavioural economics team at consultancy London Economics; Dr Heather Kappes from the London School of Economics; and Prasad Ramani, co-founder of consultancy Syntoniq who worked with MetLife on its report, A Behavioural Approach to Employee Financial Wellness.
MetLife’s own data 2 shows nearly two out of five (39 percent) of employees live from payday to payday and 60 percent are concerned about job security underlining the worrying impact of uncertainty on work output and quality as well as employee relationships.
Adrian Matthews, Employee Benefits Director, MetLife UK said: “A comprehensive approach to employee mental health has to include efforts to support financial wellbeing across the workforce ”.
“Employers are uniquely positioned to help but there is no one thing that will address the issue in totality and providing financial education on its own is not sufficient especially for people under stress or suffering poor mental health. The sheep dip approach where everyone gets a 15- or 20-minute talk needs to be a thing of the past.”
Financial wellbeing is driven by a combination of being in Control; having the Capacity to withstand financial shocks; Confidence in the future; and Choices on how to spend and save. But if any one of the four Cs is missing financial resilience is weakened.
Actions to help promote financial wellness can be relatively low-tech and do not involve major investment, the symposium heard. Changing financial behaviour can be as simple as amending communications and forms as well as adapting scripts for call centres.
Employer concerns that addressing financial wellness is going to be expensive and time-consuming need to be addressed as the worry about cost is wrong, the symposium was told.
Employees need to buy in to the process and solutions for their financial issues need to be signposted and focused on progress and commitment. Behavioural techniques such as closing the intention behaviour gap and leveraging social norms to help drive good habits can help. However, experts advised that the key issue is to have the conversations about financial worries and increase engagement with staff about benefits and how employers can help.