Summary:
How do finances affect emotional wellbeing?
How can financial wellbeing affect work performance?
How can you support your employees?
Reasons to implement a financial wellbeing programme
The Link Between Financial Wellbeing and Mental Health
Workplace mental health issues have been on the rise for over a decade, and understandably spiked significantly during the Covid-19 pandemic.
There are many possible reasons behind poor mental health at work, including non-work related issues, but worrying about money is one of the biggest drivers of stress in UK adults.
Let’s take a look at the link between financial wellbeing and mental health, and what you can do as an organisation to support mental health at work.
How do finances affect emotional wellbeing?
Studies have demonstrated a clear link between finances and emotional wellbeing. Two thirds of employees who are struggling with financial worries have at least one sign of poor mental health that affects them at work. This includes:
- Loss of sleep
- Poor concentration
- Reduced motivation
Financial stress and mental health statistics in the UK
Not convinced by the link between financial stress and mental health? Consider these four statistics from the Money and Mental Health Policy Institute:
- 46% of people in debt have been diagnosed with a mental health issue
- 86% of people in debt and who have been diagnosed with a mental health issue report that their debt makes their mental wellbeing worse
- The combination of depression and debt makes it 4.2 times more likely people will still have debt 18 months later
- People in debt are three times more likely to contemplate taking their own life as a result of their debt
How can financial wellbeing affect work performance?
Studies have shown a ‘strong association’ between financial stress and job performance, with workers suffering from high financial stress performing significantly poorer than workers with low financial stress.
However, financial worries also lead to much poorer mental wellbeing as a whole, which also has a big effect.
If your employees are experiencing depression or anxiety, both of which can be caused by financial stress, their productivity falls, they feel more fatigued and they make poorer decisions.
Absenteeism is significantly increased too. Approximately 32.5 million working days are lost in the UK every year due to work-related stress, depression and anxiety.
Increased stress also ultimately leads to burnout, and a 2016 study conducted by Kronos found this was cited by 95% HR leaders as one of the biggest challenges for staff retention.
How can you support your employees?
The stakes are high for organisations across every sector, but fortunately there are several ways you can support your employees with their financial wellbeing and mental health.
Provide financial guidance
According to the CIPD, one in five workers would value broader financial guidance, debt management and counselling from their employers. Consider bringing in an outside expert to talk about financial issues and provide advice and support.
Employee Assistance Programme (EAP)
An EAP is an easy and efficient way to connect your employees with mental health support. Our EAP solution provides 24/7 access to counsellors who are members of, and accredited to, the British Associations for Counselling and Psychotherapy (BACP), and can provide support if your employees are struggling with financial worries.
Salary sacrifice schemes
A salary sacrifice scheme, whether that’s used for energy efficient cars, travel season tickets or childcare vouchers, can help your employees’ money go further.
For example, if an employee pays for their train season ticket needed for their commute through a salary sacrifice scheme, they can make significant savings on their National Insurance Contributions (NICs) and spread the cost across the year without having to take out expensive lines of credit.
Employee benefits platform
An employee benefits platform is another great way of empowering your workforce to make the most of their salaries.
A comprehensive employee benefits solution can offer money off on everything from the weekly shop to family holidays, easing the financial burden of essential purchases as well as making it easy for your staff to continue doing the things that make them happy.
When you choose Sodexo Engage as the provider of your employee benefits package, our specialist account management team will support you in identifying the perfect benefits for your team.
Reasons to implement a financial wellbeing programme
There are a number of reasons you should consider implementing a financial wellbeing programme within your organisation.
- Workers who have or had have mental health issues make up a significant part of the economy, contributing £225 billion every year (12.1% of UK GDP)
- You can mitigate the impacts to employee performance that comes from worrying about money
- You can increase worker productivity. A study conducted by BT and Oxford University’s Saïd Business School found that we’re 13% more productive when we’re happy
- A financial wellbeing programme is more effective than increasing salary when it comes to increasing job satisfaction. Research by BDO UK found higher pay only worked for employees who were ‘extrinsically motivated’
Here at Sodexo Engage, we’re best placed to help your organisation support its employees with their financial wellbeing and, ultimately, their mental health.
We offer a broad range of solutions that cater to both their financial and emotional wellbeing needs, while we will also work with you to identify the ideal products for your workforce. We don’t believe in a one-size-fits-all approach, and our dedicated account management team will deliver a strategic plan for getting the most ROI from your financial wellbeing programme.
To find out more about our expertise and over 60 years of industry experience, get in touch with us today.