UK adults believe their financial situation will worsen, says new CIPD research. With economic factors driving down wages and raising living costs, just 15% of the population say they live comfortably.
Financial pressures are always highlighted as particularly damaging to mental health, work-life balance, personal stability and identity and relationship health, all of which have a knock-on effect to productivity in the workplace.
A CIPD survey earlier in the year found one in four people are performing poorly at work due to money worries, while a Barclays survey found that 60% people were “balancing,” or concentrating on immediate financial issues rather than saving for the future.
The Barclays survey also found that poor financial wellbeing reduced business productivity by 4%. At a national level, financial stress among employees costs organisations £120 billion in lost productivity and sickness absence.
A further report from Neyber [PDF] found that 17.5 million working hours are lost each year due to financial worries of UK employees.
What should organisations be doing?
It can be tempting to treat the symptoms but not the cause because it's easier.
But unfortunately, financial literacy in the UK is very low - and it's this area organisations should focus on. It's the "give a person a fish, or teach a person to fish" mentality.
An article on our sister site HRZone points to a study out of the US that the preferred approaches for delivering financial education were live, in-person seminars, one-to-one coaching, webinars and self study/video tutorials. A multi-track approach would be idea.
The same study found that after attending a one-to-one session, 80% of employees took steps to improve their financial position, showing that these kinds of interventions can have real impact.
There's a huge amount that financial wellbeing training can include, such as:
- How technology can assist long-term thinking: apps such as Pennies, automated regular saver payments
- Shifting the mindset: the power of compound interest, the impact on wellbeing of having long-term financial plans
- Downsizing and planning: the effect of meal plans on the cost of food, or how to gain confidence in cooking wholefoods and buying in bulk
3 Responses
I am a maths tutor as well as
I am a maths tutor as well as running adult courses and I am staggered by how little preparation is done in schools to help students understand finance. No understanding of loans; APR; how to work out your tax and NI; interpreting gas and electricity bills; pension workings.
Let’s not talk about skills for commerce such as profit and loss; gross margin etc.
Bryan
http://www.abctrainingsolutions.biz – off shelf training materials and course delivery
Agreed and not only that but
Agreed and not only that but key concepts like compound interest which have the capacity to change your whole life outlook. And the idea of your money ‘working for you.’ These are both concepts that can be easily translated to even primary school level.
We are a new Social
We are a new Social Enterprise based in N Ireland that provides Financial Wellbeing for Community , Employers and Employees, I agree Financial Wellbeing has been over looked by many companies and yet financial concerns to employees is one of the major issues that staff face, employers also have a duty of care to look after employees who have financial problems, you can call us on 02890 307977