This year, PwC’s Employee Financial Wellness Survey incorporated the views of 1,600 Full-time employed adults, and it marks the first time a decline in specific areas associated with employee financial wellness.
Although the topic of Financial Wellness has been a hot topic within the voluntary benefit industry for the past several years, the biggest issue is associated with financial stress – which has increased to 52% in 2016. The bottom line, according to the PwC survey, is that “financial wellness is emerging as a key factor in an employee’s overall well-being.”
With a decrease in productivity and a rise in absenteeism combined with an increase in the cost of health care, employers are getting hit with the effects of their employees’ financial stress from multiple sides.
Here are 9 areas where financial stress is impacting your company:
- Fiscal Responsibilities on the Rise:
There is a 7% increase in the past year of employees needing to help their parents, and the aging population is leaving a significant portion of their health care costs to the next generation. Approximately 22% of employees are responsible for providing support to their parents.
- Personal Finances a Distraction at Work:
Last year, PwC reported that 20% of employees acknowledged that their financial situation has been a source of distraction at work. This year it has increased to 28%, with many sharing that they spend at least 3 or more hours each week stressing about or addressing issues associated with their financial situation.
- Lack of Emergency Funds Available:
Nearly half of Americans would have trouble finding $400 to pay for an emergency.
- Increase in Credit Card Balances:
When employees don’t have an emergency fund, they turn to credit cards to address the crisis, resulting in increased debt and additional long term financial stress.
- Unable to Fiscally Function with Potential Job Loss:
Sometimes job loss may occur - less than 41% of employees shared that they could survive for an extended period. However, that means that 59% of employees would not be able to financially survive in case of potential job loss.
- Change in Spending Habits:
The PwC survey cites that employees are trying to cut spending and are making an effort to improve their financial situation. However, limiting spending in certain areas isn’t reducing their financial stress.
- Finances the Major Source of Stress:
In the areas of mortgage, health, relationships and their job – financial stress is listed at the top, with almost half citing it was their biggest worry.
A shift in workforce occurred in 2015, with Millennials making up the largest portion. Their stress in the past year increased 15% from 22% in 2015 to 37% in 2016!
Almost half of full-time millennials are more likely to be distracted at work by their personal finances.
- Impact in Other Areas
An employee dealing with financial stress understands that it impacts their health, relationships and overall job performance. The PwC survey reflects that there is a willingness by employees to improve their financial situation and that they would take advantage of opportunities if they were available.
Having a personalized Financial Wellness Program that is comprehensive enough to address their financial situation is just such an opportunity.
 2016 PwC Employee Financial Survey