Financial concerns cause UK workers to take four million days off work every year, according to new research from Aegon. The insurance and asset management company carried out the survey in conjunction with the Centre of Economics and Business Research.
The Financial Wellbeing in the Workplace Report explores and analyses the financial state of UK employees, and works out the detrimental impact on productivity in the workplace. In addition to the massive amount of working days lost due to financial concerns, the report found that those who keep working lose up to two hours of productive output every day.
By combining absentee levels with ‘presenteeism’ (that is, employees attending work but operating at lower levels of productivity), it was calculated that this costs UK businesses £1.56 billion a year.
Small businesses suffer most
According to the research, younger workers experience the highest level of concern over finances. This generation also reports the lowest financial wellbeing scores. Despite this, they also consider themselves as the group of people who are doing the most to actively prepare for their future. Around 46% of respondents under the age of 35 believe that they are doing everything possible to improve their financial future. When it comes to people aged 55 and over, this drops to just 37%.
Employees working for SMEs suffer the most, with just over a third of staff working for small businesses (defined as fewer than 50 staff members) saying they only just get by financially. This compares to just over a quarter in large businesses (defined as more than 250 staff members). The report suggests that this lower number is likely to reflect the more impactful efforts made by large employers to encourage financial wellbeing among their employees.
Financial assistance needed
Around 35% of SME employees state that they would like to receive some kind of financial education or help, but only 16% are receiving this from their employer. However, Aegon also discovered in separate research that just under half (45%) of SME business owners think that it would be intrusive to approach their employees about their personal finances. Despite three quarters of SME employers saying that their workforce productivity is adversely affected by employees’ money worries, almost 50% state that it is not their place to get involved.
A wider campaign by Aegon aims to delve deeper into the financial wellbeing of employees in the workplace. Various recommendations include employers taking responsibility for raising awareness among staff regarding the Government’s £500 allowance available for advice on pensions. They say that employers should consider financial wellbeing as part of mental and physical wellbeing. As part of this, greater support should be made available by the Government to offer financial advice and education within their workplace.
James Turner, Managing Director of Turner Little Limited says: “The research findings show the impact on small businesses of poor financial wellbeing among employees. It’s an important issue that is negatively impacting both employees and employers in many cases. There is a significant amount of evidence that financial problems among the workforce are damaging productivity and mental health.
“Employers should be better supported in order to assist employees with their financial wellbeing. Lots of employers are unaware of the kind of help they can offer staff, while many others feel it’s not their place to do so. This should change. It’s clear from research that many employees actively want financial support from their employers, in terms of advice and raising awareness.
“It’s clear that this is an issue that should be addressed by small business owners as it has been a long-term problem for them. It’s likely that those who chose to focus on addressing the problem and offering financial help to their workforce will benefit.”
About Turner Little
Founded in 1998 in Yorkshire, UK, Turner Little is a specialist UK and offshore company formation, banking and corporate services provider. Our services include company formation, UK and offshore banking, asset protection, credit correction/repair, trademarking and trusts. Other services include Internet services, mail forwarding, wills and probate. Turner Little’s vision is to offer the best possible service, together with market leading products.