With the pandemic leading many employees to focus more on workplace financial benefits, a new study finds that nearly all HR executives are placing a priority on reevaluating such benefits for 2022.
Findings from Morgan Stanley at Work’s inaugural State of the Workplace Financial Benefits Study reveal that employees are paying more attention to their financial benefits amid the “great resignation.” In fact, 61% of employees are now paying more attention to the financial benefits offered compared to a year ago. This is particularly true among Millennials, where nearly 7 in 10 (69%) respondents are more focused on reviewing these benefits.
And as one might expect, much of this sentiment comes as a result of employees losing financial footing during the pandemic. According to the findings, employee contributions to all financial accounts took a hit. The survey found that 59% of employees surveyed said they needed to reduce contributions to savings, debt or loan payments that occurred across 401(k) savings accounts (29%), long-term savings (28%), emergency and short-term savings (25%), and debt and loan payments (25%).
The pandemic has also blurred personal and professional boundaries, which may account for greater visibility of specific financial hardships, the study notes. In fact, employees and HR executives alike see the impact of personal financial stress on worker productivity and performance. For instance, 64% of employees report that financial stress is negatively affecting their work and personal life, while 82% of employers are worried that personal financial issues are affecting employee work productivity.
As such, most employees agree (83%) that employers should be more involved helping with specific employee financial troubles. Employees also link financial benefits to retention. Here, the survey found that more than 9 in 10 employees (91%) say they would feel more invested in staying with their employer if offered financial benefits that met their needs. What’s more, nearly the same amount (90%) of employees say their company should prioritize reevaluating its financial benefits package in 2022.
Help with Financial Stress
HR executives apparently agree that employers should be more involved in helping their employees with personal financial troubles—and nearly four out of five (78%) HR executives say employees have requested support that would fall under financial benefits that their company does not offer. As such, employers recognize that there is more work to do to stay competitive, with 79% of HR executives believing that a lack of financial benefits will result in attrition.
This apparently has led HR executives to call for benefits to help employees better manage financial stress. According to the findings, 95% of HR executives say their company’s reevaluation of their financial benefit package for 2022 will be a priority.
“Employees are now looking for employers to offer a full spectrum of financial benefits tools and guidance to help them along the right path financially,” notes Brian McDonald, Head of Morgan Stanley at Work. “As a result, those companies that offer a robust benefits package that includes retirement planning, equity compensation, student loan refinancing plans, and overall financial wellness benefits will differentiate themselves in the face of unprecedented competition for great talent.”
Findings in the study are based on a survey conducted Sept. 21–28, 2021, by Wakefield Research among 1,000 U.S. employed adults and 600 HR executives, with quotas set for both groups to match representative distributions, including for company size, benefits status and seniority.
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