Employee Benefits | FJG/FYI
Industry SpotlIght: Impact of Employee Financial Stress on Health and Productivity
As more employers turn towards corporate
wellness programs to control insurance and
claims costs by helping employees improve
their health, some are looking at the impact
of their employees’ financial wellness
upon their health and productivity.
A recent study titled “Negative Health
Effects of Financial Stress” found that
51% of employees reported that they
are under “moderate financial stress”,
with 35% claiming to be under “severe”
or “overwhelming” financial stress (1).
The study also indicated that 82.5%
of respondents said that their financial
stress resulted in negative health effects,
including headaches, digestive problems,
depression, high blood pressure, insomnia,
and appetite disorders.
Another similar study found that 25% of
employees suffer from serious financial
stress, with almost half of those employees
reporting that their health has been
negatively affected by it (2). Eighty percent
of those employees also indicated that they
deal with their financial issues during work,
including time spent communicating with
their creditors.
It is estimated that the cost of employee
financial stress to employers is $15,000 for
each affected employee. This cost is what
is driving some employers to consider
adding financial counseling services to
their employee benefits offerings. Eighty
percent of employees say that they are
interested in receiving financial counseling
through their workplace, and would
use this service if offered. In addition to
helping improve their health and reduce
healthcare costs, improved financial wellbeing
among employees can result in a
30% increase in productivity (2).
Employers may turn to a variety of sources if they choose to provide financial counseling to their employees. In addition to offering these services as a single employee benefit, many Employee Assistance Programs (EAPs) and some wellness companies are beginning to integrate financial counseling into their packages. An integrated approach can help employees understand the impact that financial stress has on their physical and mental health, and learn better ways to cope with their finances and mitigate the impact of financial stress.
(1) Employee Benefit News. Financial, EAP
Counseling Can Improve Fiscal, Physical
Health. March 1, 2007.
(2) Employee Benefit News. More Employees Report Floundering Financially. February 2, 2006.