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While the Central Bank of Ireland’s Household Credit Market Report has highlighted that household debt in Ireland is the fifth highest in the EU.
Money worries are common among the UK and Ireland workforce. As much as a third of people in Ireland are “very worried” about their personal finances and 31% of employees in the UK feel that their finances control their life.
The effects of a lack of financial wellness doesn’t end with the individual, it can cause severe harm for employers too. Salary Finance have estimated that a lack of financial wellbeing in a workforce can cost the average employer 13-17% of their total payroll.
This is why Debt Awareness Week—held on 23rd-29th March—is the perfect opportunity for employers to address the importance of financial wellbeing and to put measures in place to tackle the issue in the workplace.
Trying to determine if members of your workforce are struggling with their personal finances can be a difficult task. Often, employees will be apprehensive to talk about their finances (especially to their employer). However, by circulating anonymous surveys to all employees, you will be able to gauge an idea of what support your team require.
Reduce Commuting costs: For city centre workers in particular, car parking can cost team members a considerable sum over the course of the year. You can assist your staff by identifying areas around the workplace with either free or cheap parking. You could also introduce a cycle to work scheme, or encourage walking for those who live within a reasonable distance. This would have the added benefit of healthier staff, which could lead to a more productive workplace.
Be flexible: Offer flexible work schedules and consider remote working. These can reduce the financial burden of childcare fees for many employees.
Education: Provide financial education and guidance as part of a wider wellbeing programme. Even understanding their payslip can be complex for employees—simplifying some processes, and showing how others work, can reduce the burden of financial stress.
Keep well informed: Make sure that you are aware of any local changes that could affect the financial wellbeing of your team. For example, a sudden increase in living costs in your area or a spike in public transport fees.
Reduced absent rates: According to the Financial Capability Strategy, each year, 5% of employees are absent from work due to financial worries. By putting appropriate support measures in place, you’ll be helping your people stay financially and mentally resilient.
Improved focus and performance: One in five employees think their financial situation affects their work. By offering support to help your team improve their financial wellbeing, you will in turn have a more focussed and productive workforce.
Keep your best people: Research has found that more than a third of employees would move to a rival company who put financial wellbeing as a priority. With the average reported cost of replacing a member of staff being upwards of £30,000, losing an employee due to a lack of financial support can make a significant impact on your organisation.
Money worries have a severe impact on who your employees feel and behave inside and outside of work. By putting in measures to help protect your workforce’s mental and financial wellbeing, you will reap the benefits of a happier, healthier and more productive organisation.
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