Financial issues are burdensome and distracting for everyone. In fact, when one of your employees is concerned about financial security, you lose them as an engaged employee.
Imagine living paycheck to paycheck and balancing which bills you’ll pay now, and which bills you’ll incur a late fee for because there isn’t enough money to go around. Payday is slightly out of sync with your bills. And, suddenly your financial burdens consume your thoughts. This scenario is far too common.
It turns out, financial stresses are very common in the workplace. According to the Employee Financial Wellness Survey, conducted by PricewaterhouseCooper's (PwC's) in 2016, responses from 1,600 full-time employees, showed that:
- 52 percent of workers worry about their finances.
- The younger the worker, the more likely he or she is worried. 64 percent of millennials said they are stressed about their finances.
- 45 percent said their finance-related stress had increased over the last 12 months.
These stresses are affecting productivity and employee engagement as well. Also, the same study shows 46 percent of workers spend three or more hours during the workweek dealing with financial issues.
Financial stress lessens workplace productivity
If your employees don’t feel comfortable in their personal lives, then their attention is split. They may not be able to devote an ample amount of engagement to their work life. One study by the University of Warwick estimates that unhappy employees are 10 percent less productive compared to happy employees who are 12 percent more productive than baseline.
A Gallup survey shows even more dire statistics. They found only 13 percent of employees are engaged at work. This means the vast majority of working adults don’t enjoy their work. This lack of productivity and engagement affects a business's bottom line. The same Gallup study shows lowered productivity costs US companies roughly $450–$550 billion annually.
While financial stress and lack of engagement are common, it’s not plausible for an organization to increase wages in an effort to offset the burdens. However, it still be important to be aware and empathetic to the financial hardships your employees might be facing. Additionally, our friends over at Customer Fanatix put together a list of things that make employee engagement impossible.
Employees need security. How can an employer help?
Financial wellness is one way to improve employee engagement. With less personal distractions employees will have more capacity to be engaged at work. DailyPay, which is free to businesses and non-disruptive to payroll, can lessen financial worries for employees.
DailyPay offers employers a way to pay their employees daily without disrupting the payroll process. DailyPay is not a loan, but rather a solution for paying employees what they’ve already earned. An employee can see how much money they have earned through an app and elect to withdraw available funds as often as they’d like. Here, the difference of one or two days could help employees get themselves out of small financial binds, and lessen financial stresses.
In a national campaign which offered free DailyPay services to rideshare/delivery drivers, productivity and engagement results were staggering. Not only did attendance rate increase for employees that participated in the study, but they worked harder, too. Individuals in the test group increased their productivity by 51 percent.
DailyPay is a great tool for retention, too. It is a software is a special incentive your competition might not have. Do you want to learn more? Request a demo from DailyPay to see how you can improve employee engagement.
Connect with someone from our community team and arrange a discovery call to assess whether DailyPay would be a fit for your company. Learn more.