Employees are embarrassed about their financial literacy - HR teams should step up and support

Less than half (46%) of HR professionals foster a culture of openness about financial concerns, and only 16% of workers feel they have this kind of support at work, according to new research from Pluxee UK.

In the midst of rising living costs, the current UK workplace has overlooked the crucial necessity of providing employees with essential financial education. Consequently, workers grapple with financial challenges, impacting both their health and accumulating debt.

A staggering 51% of employees are embarrassed about their level of financial literacy, as a result.

With less than half of HR professionals actively promote a culture of financial openness, only a mere 16% of employees actually feeling this support at work.

This significant gap underscores the challenge in creating supportive workplace environments for financial discussions, with 48% of surveyed employees stating that their employer does not offer any financial wellbeing support.

HR teams are falling short

This lack of financial support, coupled with the stigma surrounding money issues, hinders employees from seeking help. To cultivate a supportive workplace, businesses must not only bridge this gap but also address the discomfort associated with discussing financial challenges.

The impact of this financial unease is reflected in the anxiety experienced by the UK workforce, 75% worrying about money at least monthly or more often, and over a quarter (26%) dealing with daily concerns.

The survey also reveals a reliance on friends/family (43%) and search engines (29%) for financial education, while only 12% turn to their employers for advice.

Employees falling into debt

Amidst this financial unease, the survey highlights around 2 in 5 employees surveyed are currently in debt— of those who are in debt, a fifth say it’s not manageable.

Recognising the need for change, HR professionals acknowledge their role in supporting employees. Three-quarters believe they need to do more to enhance financial wellbeing, with 84% that the current cost of living crisis has heightened the importance of supporting their workforce’s financial wellbeing.

This acknowledgment stems from increased demand, as 68% of HR professionals report a surge in requests for financial education or support initiatives in the past year.

On average, almost a fifth (19 per cent) of their current workforce proactively approached them seeking financial wellbeing support. Overall, it’s clear that current support is not enough to meet the demand. 

Employers are also recognising the tangible impact of poor financial wellbeing on their teams. Over half (53%) of HR professionals have witnessed negative effects on employees, including increased stress (66%), decreased productivity due to distraction (62%), lowered confidence (39%), and an increased likelihood of taking sick leave (35%).

Ensuring employees have the right support

As the weight of rising inflation strains household budgets, companies have a vested interest in ensuring their people have the financial literacy and resources to stay afloat. Beyond being the right thing to do for employees contending with the cost-of-living crisis, research shows money-worried staff are more disengaged, less productive, and quicker to change jobs.

That’s why leading HR teams make financial wellbeing a priority through proactive education, advice, and policy support. Budgeting seminars, access to financial coaches, and compassionate payroll advances cost little to provide but pay dividends in loyalty.

Meanwhile, other companies go a step further with accommodative flexibility around pay cycles. The ability to secure some wages early without relying on predatory lenders eases many workers’ biggest headache – making ends meet between pay checks.

While the cost-of-living crisis won’t vanish overnight, arming employees with literacy and compassionate backup makes weathering the storm that much easier according to experts. And that’s a win for both financial and physical wellbeing.

HRD Connect Curators of the New Business Landscape. HRD Connect produces industry-recognized content for senior HR leaders. Through articles, case studies, Q&As, podcasts, events, and more, we offer truly progressive and cutting-edge insights designed to help people leaders address core HR challenges and add greater value to their business.

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