employee financial stress

Employee Financial Stress Takes a Toll on the Workplace

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Employee financial stress isn’t something that workers can compartmentalize or think about only in their non-working hours. In fact, fifty percent of American employees surveyed say they spend three or more hours of their time at work each week dealing with personal financial issues with twenty percent of that group spending as much as five hours weekly[i].

“American businesses are collectively losing $500 billion per year thanks to employee financial stress, according to a recent survey of more than 10,000 Americans who were asked about their financial stress and its impact on work performance.”

Source: HR Technologist

Employers may not realize that debt-related stress is not unique to entry-level or lower paid roles. Sixty percent of employees making over $75,000 each month say they consistently carry credit card balances while thirty-seven percent of this group say they need credit cards to pay for monthly necessities, such as gas or groceries, that they couldn’t afford otherwise.[ii] Likewise, thirty-one percent of workers making more than $100,000 a year say they run out of money before payday each month[iii].

The Alarming Financial Reality

  • 1 in 4 Americans have struggled paying a recent medical bill.[iv]
  • 1 in 4 Americans have student loan debt and 69% of recent grads have student loan debt that averages $30,000[v]
  • 45% of American families have less than $1,000 in savings[vi].

Workplace Productivity Suffers from Employee Financial Stress

How does employee financial stress impact the bottom line of your organization? Over thirty percent of financially stressed employees say their financial worries effect their productivity on the job. [vii] Financially stressed employees are more likely to miss deadlines, function below par, produce lower quality work and miss added work days.

Not only do they affect an organization’s productivity through their diminished performance, anxious and distracted employees are more likely to experience stress related illnesses, further impacting cost to the company and productivity loss.[viii]

And of course, 2020 didn’t make anyone’s stress level lower. Sixty-three percent of the 1,600 fulltime employees surveyed for the 2021 PwC Employee Financial Wellness Survey, said their financial stress has increased since the onset of the global pandemic.

A Changing Dynamic

More and more organizations are coming to terms with the reality that they have no choice but to partner with their employees. They must come alongside their teams, from entry-level to highest executives, equipping each worker with the tools needed to achieve and sustain physical and financial wellness. Strong and stable employees make strong and stable organizations; it’s the only true win-win option American businesses have.

[i] Financial Stress and the Bottom Line (https://cdn2.hubspot.net/hubfs/172936/pwc-financial-stress-and-bottom-line.pdf)

[ii] Financial Stress and the Bottom Line (https://cdn2.hubspot.net/hubfs/172936/pwc-financial-stress-and-bottom-line.pdf) 

[iii] Inside the Wallet of Working Americans https://www.salaryfinance.com/us/

[iv] 2016 Financial Mindset® Study (https://www.aon.com/attachments/human-capital-consulting/2016-financial-mindset-study.pdf)

[v] Op.cit.

[vi] PWC 8th Annual Employee Financial Wellness Survey 2019 (https://www.pwc.com/us/en/industries/private-company-services/images/pwc-8th-annual-employee-financial-wellness-survey-2019-results.pdf)

[vii]Financial Stress and the Bottom Line (https://cdn2.hubspot.net/hubfs/172936/pwc-financial-stress-and-bottom-line.pdf)

[viii] Op cit.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. Any tax advice contained herein is of a general nature. You should seek specific advice from your tax professional before pursuing any idea contemplated herein.

Securities offered through Lion Street Financial, LLC (LSF) and Valmark Securities, Inc. (VSI), each a member of FINRA and SIPC. Investment advisory services offered through Lion Street Advisors, LLC (LSA) and Valmark Advisers, Inc. (VAI), each an SEC registered investment advisor. Please refer to your investment advisory agreement and the Form ADV disclosures provided to you for more information. VAI/VSI and LSF/LSA are non-affiliated entities and separate entities from OneDigital and Fulcrum Partners.

Unless otherwise noted, VAI/VSI, LSF/LSA are not affiliated, associated, authorized, endorsed by, or in any way officially connected with any other company, agency or government agency identified or referenced in this document.

Lion Street Advisors // Lion Street Financial

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