Here’s an evergreen New Year’s resolution—try not to be financially stressed in 2019.
Willis Towers Watson recently explored the association of financial stress and on-the-job performance using a large employer’s experience.
The goal was to measure the magnitude of the difference in the performance of financially stressed employees and non-stressed employees.
Its finding?
Nearly a quarter of the workers are in the “high financial stress” group.
“Financial stressors might be triggered by phone calls, or ongoing financial worries could become an overwhelming distraction,” according to the company. “These effects could degrade the quantity and quality of work output as employees take longer or more frequent work breaks or, because of divided attention, take more time to perform tasks correctly.”
Such an impaired job performance observed in the employees with high financial stress are concerning “because of the potential impact on customer satisfaction and customer retention, both key determinants in profitability.”
Moreover, it adds, the impact could be more pronounced and worrisome in industries where worker impairment can create a hazard for coworkers or the public, such as utility, transportation, construction, petroleum, food, chemical and pharmaceutical production and manufacturing, and medical, to name just a few.
In addition to job performance, Willis Towers Watson found higher instances of sick days, unpaid and non-pregnancy-related disability leave among highly-stressed employees, who took 1.75 absence days to every one day taken by low-stress employees.
And it notes that financial stress varies according to life stage.
Middle-age employees (age 35 to 54) were far more likely to be in the high and medium financial stress groups than their younger (age 18 to 34) and older (age 55 and over) cohorts.”
“It is easy to understand why middle-age employees are more financially stressed. Middle-age years are the peak for the expenses of family building and child-rearing, typically including pivotal financial decisions concerning housing, automobile, education, technology and day-care needs as well as more volatile medical costs.”
The study results showed that 69 percent of the high-stress group had children compared with 42 percent of the low-stress group.
Additionally, more than a quarter of the high-stress group were single heads of households, compared with only 10 percent of the low-stress group.
What can employers do?
“An employer’s first step to devising a strategy for employee financial wellbeing support is to assess the level of financial stress in the workforce, gain insight on the specific situations where financial stress is most severe and identify the opportunities to best address the root causes.”
And it added that there is no one-size-fits-all strategy for supporting the financial wellbeing of an employee population.
“Whatever is the right course of action for your organization, the lesson is clear. Those organizations that address financial wellbeing can reap the competitive advantage of higher employee engagement, fewer absences and greater levels of productivity.”
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
