Breaking free from crisis: now must be the turning point for financial wellbeing support
For decades, when businesses thought about employee benefits and perks, they would invest in generic options like fruit bowls, gym memberships and healthcare. Finally, however, we are seeing financial wellbeing take centre stage.
Once on the periphery when organisations were considering employee benefits, financial wellbeing has fast become a cornerstone of employee support and HR. It is an invaluable tool in supporting employee welfare and resilience, boosting retention and talent acquisition, and even helping businesses cut costs.
The progress that has been made since the start of 2020 should be welcomed. Many employers are now more actively considering how best to improve their employees’ wellbeing, and there is a better understanding of how financial wellbeing is central to this. But much of the progress made has come out of necessity – organisations are extinguishing fires and reacting to socioeconomic crises.
That is why, as we look to the future of financial wellbeing support, a fundamental shift in approach is still to be made.
A whirlwind four years
The Covid lockdowns blurred the divisions between our professional and personal lives, altering working patterns. As flexibility became more in-demand – with people increasingly keen for more choice in how, when and where they work – employers needed to respond.
Simultaneously, many people experienced elevated levels of anxiety and more significant health concerns during the pandemic. Many employers reacted by acknowledging their social responsibility to support employee wellbeing, and recognising the relationship between physical, mental and financial wellbeing.
Crucially, the need for employers to consider their staff’s wellbeing is not only a moral or ethical issue; there is a clear business case for it too. Struggling employees are not productive employees. Indeed, Mintago’s research has found that half (49%) of Britons say their work performance is negatively impacted by stress and anxiety.
Not only will productivity be damaged by poor wellbeing, but so will retention. The pandemic triggered what became known as the ‘Great Resignation’, as millions reconsidered what they wanted from their job and who they wanted to work for.
Better pay, benefits and culture became the primary reasons most workers sought out a new job. During this highly competitive period it was vital for companies to respond by paying higher wages and enhancing benefit offerings like wellbeing support, to attract top talent and retain employees.
As pandemic pressures waned, the ensuing cost-of-living crisis thrust personal finance and financial wellbeing into the forefront of our minds. With inflation rampant, 2022 marked the UK’s worst year for real wage growth since 1977, leaving many workers struggling to make ends meet.
As many employers struggled themselves with rising costs, supporting employees through wage increases was not always an option, and some sought out better perks and benefits – such as financial wellbeing support – as an attractive, effective alternative to keep staff.
Meanwhile, the ongoing strain inflation has placed on finances has led to more employees proactively seeking support from their employers. For many workers it has become a sticking point, with nearly half (44%) of UK employees willing to leave their current roles for ones that offer better wellbeing support, according to Mintago’s research.
From reactive to proactive
While progress has evidently been made, financial wellbeing support still has a long way to go . Many employees remain dissatisfied with the level of support on offer, with less than a third of workers (32%) feeling their employer cares about their financial wellbeing.
A robust financial wellbeing strategy cannot be borne out of a reactive approach, ricocheting from one crisis to another and implementing token solutions that are not effective. Businesses simply cannot continue to put out fires as they arise where employee wellbeing is concerned – instead, they must be progressive and proactive in developing meaningful financial wellbeing support.
As we look beyond the pandemic and cost-of-living crisis, the future of financial wellbeing lies in implementing comprehensive, tech-powered strategies to fully equip employees with the tools they need to navigate their financial lives with confidence. In turn, businesses are primed to protect their top talent, fulfil their social responsibility to their workers, and reap the benefits of a contented, secure workforce.
Robust financial wellbeing solutions
Crucially, it must cater to each individual’s needs. Generic content or light-touch policies will not suffice. Whether it is for a recent graduate wanting to get their head around pension contributions, a 35-year-old wanting to understand how to effectively save or invest their money so they can buy their first home, or an older professional needing retirement planning advice, employers must ensure employees can find the support they need.
For example, there are now solutions that enable employees to manage their pension contributions via an online dashboard, that allow people to improve their financial wellbeing through access to a vast library of educational resources, and that use cutting-edge AI-powered chatbots to answer financial queries. Employers should also consider facilitating access to independent financial advisers, who can help employees manage more complex financial issues and provide personalised support.
There is no question that in recent years financial wellbeing support and recognition of its value has advanced significantly, largely in response to the pressures of the pandemic and current cost-of-living crisis. Yet, there is so much further still to go. Ensuring stability and happiness among employees means HR and business leaders taking a proactive, progressive approach to financial wellbeing, leaving no stone unturned and continually looking to bolster and future-proof existing support systems – even when the waves are calmer.
Mintago is proud to be leading the way in this space, with hundreds of organisations already adopting our platform to support their employees. Collectively we must all strive to break new ground in the financial wellbeing space – this will undoubtedly be a pertinent trend in the HR and management world in the years to come.