With financial pressure on U.S. employees piling up, the results of a new survey suggest that most employees want guidance from their companies to navigate inflation.
The joint survey by TalentLMS, Enrich and Tapcheck reveals that economic uncertainty caused by rising inflation and recession fears is having a detrimental effect on the health and well-being of U.S. employees who are seeking more support from their employers than they are currently receiving.
Of the 1,000 U.S. employees surveyed, less than half of employees (49%) feel they are on track to meet their financial goals and retire by the desired age, with inflation (62%), insufficient income (48%) and coping with debt and high-interest rates (37%) being the top obstacles in reaching their goals. In addition, talks of a recession have made 7 in 10 employees more concerned about their financial wellness.
Moreover, nearly half (49%) of employees admit having experienced physical and mental health issues due to money-related stress. By generations, Millennials appear to be facing the greatest challenges, with two-thirds (66%) of respondents reporting that they have experienced mental health struggles due to money-related issues compared to 59% of Gen Z, 47% of Gen X and 24% of Baby Boomers.
To weather the storm, the survey found that, across four working generations, most employees are coping with financial insecurity by spending less and saving more. Going out, shopping and entertainment are the three main areas where employees have reduced spending because of inflation. The next coping strategy is learning to manage finances better, followed by looking for a new job that pays better.
Meanwhile, 73% of employees report that they are getting financial wellness benefits from their employer and 51% are receiving financial wellness training at work. Yet, less than half (45%) say their company is doing enough to improve their financial wellness.
Financial Wellness Priorities
As such, the survey report suggests there’s a lot of room for improvement in the current offer of employee-supportive financial incentives.
When it comes to financial wellness benefits, the majority of employees across generations chose retirement planning (53%) as the most sought-after benefit they would like to receive from their employer, followed by investment programs (42%) and emergency savings (38%).
However, diving deeper into the findings, there are differences in how different age groups prioritize other benefits. For example, for Gen Z the runner-up is emergency savings (43%), followed by investment programs and meal allowance (34%). Millennials also rank emergency savings in second place while the third spot differs, with financial coaching/advising (36%) taking it. Whereas for Gen X and Baby Boomers investment programs take second place after retirement planning, followed by emergency savings for Gen X and medical care cost planning for Baby Boomers, the survey shows.
Moreover, getting guidance from their employer on monthly spending resonates with younger employees, with 62% of Gen Zers finding this important; only 37% of Baby Boomers find it important, however.
Employees also care about financial advice beyond the traditional sense. Here, the survey found that 48% of employees believe it is important to get advice from their employer on new currencies (e.g. NFT, cryptocurrencies), while 53% believe it is valuable to get guidance on monthly spending and saving.
Financial wellness benefits may also have an impact on retention. More than two-thirds (68%) of employees indicate that they are more likely to stay longer at their current job if their employer offers financial wellness benefits. Similarly, more than half of employees (61%) are more likely to stay at their current job if financial wellness training and resources are offered. What’s more, as high as 80% of employees prefer additional benefits over a pay increase, the survey shows.
“Financial training and support is a low investment, high output benefit and, combined with financial wellness products (FSAs, investment options, contribution matching, etc.), will help create much needed stability and peace of mind,” says Christina Gialleli, Director of People Ops at Epignosis.
“This new data reveals how important financial wellness is to today's employees, especially with the financial challenges we are all facing,” adds Kris Alban, Executive VP at Enrich. “Because of this, employers have a unique opportunity to attract and retain employees by offering financial wellness benefits and education.”
The survey of 1,000 full-time employees in the U.S. was conducted online from Oct. 3-5, 2022. The respondents were from four age groups, with 250 respondents from each: Gen Z (18–25), Millennials (26–41), Gen X (42–56), and Baby Boomers (57–76). Forty-six percent of the respondents were male, and 54% were female.
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