Despite the strong economy and low unemployment, many American workers are still struggling financially.
According to the Federal Reserve, 4 in 10 adults say they would not have the money to cover an unexpected $400 expense.
Data from our MyChoiceSM Recommendation Engine backs up this statistic. During the 2019 annual enrollment, members indicated they aren’t prepared to handle a large unexpected expense; 42% say they would go into debt, dip into their retirement savings, or simply not know what to do. Even among employees earning $100k or more, 20% say they would go into debt.
Of course, most HR professionals don’t need federal reports or enrollment data to tell them how much employees are hurting. The recent government shutdown made us all acutely aware of the fragile state of American workers’ savings.
Why should HR care?
As a strategic partner in producing the desired business outcomes for your organization, HR needs to understand the impact of poor employee financial well-being. According to a recent survey, employees who are stressed about their finances are:
- Nearly five times more likely to be distracted by their finances at work
- Twice as likely to spend 3 hours or more at work dealing with financial matters
- Twice as likely to miss work on account of their personal financial issues
- More inclined to cite health issues caused by financial stress.
What’s HR to do?
Think beyond retirement. Supporting employee financial well-being is not entirely new territory. HR professionals already have a pretty good track record of helping employees easily save for retirement. But there’s much more to it than retirement security. Employees are having trouble funding everyday expenses which is causing negative ripple effects throughout the modern workplace.
To support employee health, increase productivity, and improve your organization’s profitability, start by focusing on their “here-and-now” concerns. Find out what’s keeping them up at night.
By thinking outside the box, you can be the hero employees need today to help them achieve financial well-being tomorrow. How?
Start by looking at the data in your benefits administration system. Employee surveys can also be a helpful tool to understand specifics about your unique workforce population. Remember, one-size-doesn’t-fit-all.
As you review your findings, look for similarities across generations and life stages. Some employees may need help with emergency savings. Some may benefit from financial literacy education. Others may need resources for managing credit card debt. Some could be ready to learn about buying their first home, while others may need guidance saving for their kids’ education.
So what if you’re not faster than a speeding bullet, more powerful than a locomotive, or able to leap tall buildings in a single bound. Solving the employee financial crisis doesn’t involve superpowers, just empathetic HR professionals armed with the right benefits solutions. Take a deeper look at the data in our infographic below.