Over the past year, more than half of full-time employees struggled to cover monthly living expenses, and another 37% lived paycheck-to-paycheck, according to a survey of 1,105 U.S. full-time employees from voluntary benefits company Purchasing Power, conducted by the Harris Poll. An important finding from the report is that financial pressures aren’t exclusive to lower-income employees: Among households with an income of $100,000 or more, 17% have been unable to cover monthly living expenses over the past year, and 25% have lived paycheck to paycheck, barely covering monthly living expenses, according to the survey.
What it means to HR leaders
Compounded by the ongoing COVID-19 pandemic and soaring inflation, employees are struggling with their finances—and it’s having a big impact on all aspects of their life: 34% report it affects their physical health, 45% report it affects overall stress at home and 25% report it affects their job satisfaction. Financial stress also is affecting their work, with 28% of employees saying it affects their ability to focus at work (up from 24% who said so in 2021).
Those figures show the importance of employers and company leaders paying attention to their employees’ financial stress. In fact, according to the Purchasing Power survey, 72% of employees believe that employers have a responsibility to help employees improve their financial wellbeing.
While higher pay and better offerings are universally helpful, it’s not always feasible for organizations dealing with budget constraints of their own. Employers can help fill the gap with “more robust and comprehensive voluntary benefits offerings that include a holistic approach to employees’ financial wellbeing,” says Trey Loughran, CEO of Purchasing Power. “In fact, 80% of full-time employees say the benefits their employer offers have an impact on their decision to stay at their current job.
“Employers who implement a spectrum of financial wellbeing benefits will gain from increased employee performance and retention,” Loughran says.