The research behind The Employer’s Guide to Financial Wellbeing found that over 40% of people have financial worries. These worries have a large impact on their daily lives which, in turn, creates a considerable cost for employers. We estimate the average employer is losing the equivalent of 13-17% of their total payroll cost to poor financial wellbeing.
The survey results show how severely financial worries can affect an individual’s performance at work. Those with money worries are:
- 8.8x more likely to have sleepless nights.
- 7.6x more likely to not be able to finish daily tasks.
- 6x more likely to see the quality of their work go down.
- 5.7x more likely to have troubled relationships with their colleagues.
Clearly poor financial health erodes people’s productivity at work. These employees are turning up to work tired, unable to concentrate, and stressed.
Continued stress, struggling to complete tasks on time, absenteeism and troubled relationships contribute to increased employee turnover. Financially worried employees are also 2.2 times more likely to be looking for a new job than those who do not have money worries.
A recent Harvard Kennedy School study reported that the cost of losing an employee is between 16-20% of annual salary. This is the combination of recruitment costs and onboarding costs, training costs, lost productivity and reduced staff morale.
Putting all this together, the lack of financial wellbeing is costing the average employer 13-17% of their total payroll cost. We estimate the cost to all UK employers could be as high as £39-51bn pa, or a staggering 1.9-2.4% of GDP.
You can find out more about The Employer’s Guide to Financial Wellbeing and download your copy at: