While not unexpected in the current market environment, it’s concerning nonetheless—three in 10 U.S. workers are struggling financially, and more than two in five workers (43%) are having difficulty meeting basic needs.
“Three in 10 incurred a significant medical expense, while 23% were placed on furlough or had their hours reduced.”
New research from WTW also found a significant number of employees deferred medical care last year because of time constraints, COVID-19 concerns, and cost reasons.
Employee financial well-being has deteriorated since the start of the pandemic. According to the survey, more employees are living paycheck to paycheck—41% this year versus 38% in 2019.
Among workers earning $100,000 or more, the number of employees living paycheck to paycheck doubled from 2019.
Over half of workers earning less than $50,000 (52%), single parents (53%), and those in poor or fair health (57%) are also living paycheck to paycheck.
Additionally, employees living paycheck to paycheck are almost twice as likely to leave their employer for a 5% raise compared with those not living paycheck to paycheck.
Financial issues are widespread, according to the survey. Many workers reported having difficulty accessing or paying for housing, healthcare, or healthy food, while nearly half suffered a financial shock in the past year.
Three in 10 incurred a significant medical expense, while 23% were placed on furlough or had their hours reduced. About one in seven were victims of financial fraud or scams, while 13% experienced significant expenses due to a divorce or separation.
“The pandemic continues to affect the financial wellbeing of working Americans,” Mark Smrecek, senior director, Retirement, WTW, said in a statement. “The link between financial stability and overall wellbeing has become even more precarious as employees fret over inflation, economic instability, and workplace challenges. Employees are now looking to their employers for support. Employers, in turn, can help employees weather the storm and enhance their financial stability by factoring in wellbeing when considering programs.”
According to the survey, more than one-third of respondents said employer-provided resources helped improve their financial situation. That’s an increase from 27% in 2017. Additionally, nearly half of respondents want financial apps and tools to be a core part of their employee benefit programs.
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.
