Financial wellness is an increasing concern for many Australian workers – and after a turbulent year filled with uncertainty, it’s not hard to see why. But while our Employee Benefits Trends Study found that most employers believe they have a duty of care to their employees and understand that a healthy workforce is a productive workforce, financial wellness doesn’t rate as a high priority of most Australian businesses. So, why the disconnect?
From an employer perspective, the care is there. Three-quarters (75%) of employers claim that improving the overall health of their employees is important to them, and the majority (70%) of employers say they believe mental health is the most important aspect of overall wellbeing in the wake of COVID-19.
The divergence comes when you consider the underlying drivers leading to employee stress and poor mental health. While the majority of Australian employers have developed a “healthy workplace” definition, many of these don’t address all aspects of employee health – and financial health is least likely to be considered by employers as part of their healthy workplace framework.
For employees, on the other hand, financial health is the aspect of their wellbeing they are most concerned about as they adjust to life in the wake of COVID-19 – and half of employees feel unsupported by their employer with regards to their financial health.
Understanding financial stress
For employers to help their employees manage financial stress, they first need to get to the bottom of what’s causing it.
Australian employees say their number one financial concern is having enough money to pay the bills if someone in their household loses their job or is no longer able to work. This is followed by having enough money to cover out of pocket medical costs that aren’t covered by Medicare or health insurance; outliving their retirement savings; being able to afford the cost of healthcare in retirement; and being able to save for a big expense, like a home, car, or university degree.
On a day-to-day level, the top drivers of poor financial health include worries about the everyday costs of living, like paying for groceries and utilities; having or getting into debt; threats to job security, like the COVID-19 pandemic; and not having an emergency fund to dip into if things go wrong.
With these concerns in mind, the link between poor financial and mental health amongst Australian employees is clear.
Bridging the benefits divide to build financial wellness
While most employers believe they have a responsibility for the health and wellbeing of their workforce, 4 in 10 employers do not feel this responsibility extends to their employees’ financial wellbeing.
In addition, many employers believe they are already supporting their employees’ financial health. Forty percent of employers strongly agree the benefits their employees receive improve their financial wellness. In contrast, only 27% of employees strongly agree the benefits received from their employer improves their financial wellness.
This suggests two things - that better understanding the link between financial and mental health may change many employers’ views on the importance of financial wellbeing; and that the financial benefits on offer aren’t being communicated clearly to employees.
Reconnecting the understanding and expectations around financial wellness between employers and employees will benefit both parties. Happily, the solutions are relatively simple – building a shared knowledge of the relationship between mental and financial wellness, and greater communication of the benefits that already exist to aid employees looking for financial support.
For employees, these steps will give them access to the tools they need to better manage their financial stress and feel safer, happier and more productive. For employers addressing financial wellness will more effectively help their workers’ mental health and allow them to reap the benefits of a more satisfied and secure workforce.
For more information read the MetLife Australia 2020 Employee Benefits Trends Study