The state of employee financial wellness  report

Insights from 5000 employees and 500 HR professionals on employee financial stress, employee financial wellness programs & performance 

Today's financial landscape is fraught with challenges: inflation, wage stagnation, and a challenging job market. Financial stress has made its way into the workplace—in more ways than many of us may realize. As Forbes put it: 

“As leaders, we must recognize that financial stress is not just a personal problem but a critical business issue that affects productivity and engagement at work. Financially stressed employees are often less motivated and less productive.”

This report answers: 

• How financially stressed are today’s employees, and how does it impact their work performance? 
• How does employee financial stress impact HR teams in achieving their existing goals? 
• What can employers and people leaders do to mitigate the impact of employee financial stress on organizational performance? 

Methodology: A holistic approach to quantifying financial stress 

In order to create this report, we sought insights from both the employee and employer side of things to allow for a holistic picture of employee financial wellness and its impact on employee well being, performance and organizational success. 

Employee survey: We surveyed 5000 employees who work for businesses just like yours across 8 industries. They’ve shared their biggest financial struggles with us and have made it clear—in no uncertain terms— what you can do to help.  

Employer survey: We commissioned a survey of 500 senior U.S. HR professionals about how employees’ financial struggles impact HR’s ability to operate and what impact financial wellness programs have had on their teams. 

Below you can find a few highlights from the report. For comprehensive data insights, in-depth analysis, and key takeaways, be sure to download the full report.

The state of employee finances 

It’s safe to say that since the pandemic began in 2020, the financial landscape has been a challenge to navigate for many employees and businesses alike. In this section, we will get into what impact this has had on your employees, their stress levels and ability to bring their best selves to work.

Are employees financially stressed? If so, how much?

Almost 52% of respondents stated they are stressed about their finances daily or multiple times per day. And, a staggering 20% stating they are “very stressed” about their finances on a daily basis. 40% are at least “stressed” about their finances daily. 

Almost half of your team could be dealing with money worries so big that it’s a daily focus—taking up valuable time and energy that could otherwise be spent on work.

HR pros on employee financial stress 

You might not recognize some of the telltales of how financial stress impacts your workforce. You might not even believe it's impacting your team. If that's the case, then you're in the minority. 

Most HR pros are grappling with the consequences of financial stress. And it's impacting their ability to get things done.

In the past 12 months, have you become aware of any of your employees experiencing the following financial struggles: 

More than half (61%) of HR professionals stated that their employees have been living paycheck to paycheck. 

And almost all respondents stated their employees have experienced at least one severe situation due to their finances (homelessness, property repossession, personal bankruptcy, food insecurity, wage garnishment or eviction). 

Often when we think of financial stress, it’s easy to think that it is simply a worry, maybe of having too little to spend on discretionary costs. 

But, as these results show (and will continue to show), today’s employees are more than a little financially worried, they’re consistently stressed as they are struggling to survive. 

In the full report, hear from employees on these questions (and more): 

• What stresses you out the most about your finances?
• How do you deal with financial stress? 
• How much cash (or negative cash) do you have left over at the end of the month after bills and required expenses?
• What has been the most impacted by inflation for you over the past year?

And, from HR pros on questions like: 

• In the past 12 months, have you become aware of any of your employees experiencing the following financial struggles (living paycheck to paycheck, wage garnishment, eviction, food insecurity, personal bankruptcy or repossession, or homelessness)? 

Quantifying employee financial stress & performance

We know that today’s employees are financially stressed and it’s impacting their personal lives.

But does financial stress impact employee performance, the employee performance management process  and organizational success? The short answer is: big time, and this section will show you how. 

Employee financial stress and its impact on performance

Employee survey: Does financial stress impact your performance at work?

• 36% of employees said “yes” 

This finding underscores a critical challenge facing organizations today: the intersection of financial wellness and productivity.

Financial stressors such as: debt burdens, living expenses, and unexpected costs can create distractions, diminish focus, and increase absenteeism in the day to day lives of employees. It’s not just about individuals either—low morale and less engagement can spread across your whole team and organization (more on this below).

 Employer survey:  Do employees who struggle financially perform worse at their jobs?

• 63% of respondents said “yes” 

It’s clear from both the employer and employee side of things: financial stress impacts performance. Balancing personal finances isn't just a headache at home; it's like a storm cloud hovering over the workplace. 

“Stress hacks away at morale. Employees burdened by money matters are nine times more likely to have troubled relationships with coworkers and are twice as likely to be searching for a new job.” - Salary Finance, Inside the Wallets of Working Americans report

In the full report, you’ll find exactly how financial stress is impacting your team performance in ways like: 

• Focus
• Work quality and output 
• Team and employee morale 
• Mental health
• Attitude 
• Absences
• Employee productivity

Mitigating employee financial stress

We know that employees are stressed about their finances and it's impacting their performance at work in more than a few ways. So, where do we go from here?

Businesses are catching up to the fact that they can reduce financial stress and increase performance by financially empowering their employees with financial wellness programs or financial wellness benefits.. 

What are employee financial wellness programs?

Simply, providing employees with resources and tools to manage their finances. This can include access to a financial wellness solution like:

• Financial educational and literacy resources
• On-demand payment tools like Earned Wage Access 
• Budgeting tools
• Debt management resources
• Retirement planning

These resources financially empower employees to become more financially literate, manage their money , reduce financial stress, and achieve their financial goals.

Earned Wage Access (EWA): A financial wellness & empowerment tool 

A popular employee financial wellness tool for employers is Earned Wage Access or on-demand pay. 

EWA allows employees to access their earned wages ahead of payday. Employees can access a percentage of the wages they've already earned whenever they want, interest-free. 

In 2023, we asked almost 2500 employees who use ZayZoon’s Earned Wage Access:

Has Access to Earned Wage Access improved your overall financial well-being and financial stress?

• 74% said yes, with almost half (47%) citing significant improvement in financial stress 

Employer investment & employee financial wellness 

Employee financial wellness programs that include EWA address financial stress but are also a benefit that employees are hungry for and desire. 

In our employee survey, we asked employees: “should your employer invest in your financial wellness and literacy?” 

• 81% said yes 

Here are some of the tangible impacts investment in employee financial wellness programs could have on your team. 

HR pros on the impact of EWA and financial wellness programming

We asked HR professionals who offer EWA about its impact on organizational success.

Morale and productivity boosts

• 64% of HR leaders who have used EWA say their workplaces experienced increased morale
• 63% of workplaces report a rise in productivity after adopting EWA

Absenteeism decrease

• 25% of employers offering EWA saw decreased absenteeism
  
  

Reduce employee stress 

• 46% of respondents observed a reduction in employee financial stress when offering EWA 

 Ability to attract talent

• 42% percent of employers found that offering EWA helped attract top talent
• 81% of HR leaders believe that offering EWA provides a competitive advantage in attracting skilled employees.

Reduced turnover

• 29% of companies using EWA also saw a decrease in turnover

This data makes a compelling case for EWA as a practical solution to increasing the impact of your HR or people operations teams. EWA can bring you closer to the goals you’re already working towards this year like employee retention, talent acquisition and performance management. 

Further, by addressing employee financial stress, financial wellness programs with EWA are a critical piece in creating a more adaptable, responsive payroll and operational system that meets the critical wellness needs of today’s employees. 

Takeaways in this report 

This report will give you  a deeper understanding of the financial stress your workers are under and its implications for your team. As it turns out, financial stress impacts your business (and HR team) as much as it does your employees.

• Over half (50%+) of served employees experience daily financial stress, which employees and HR professionals alike note negatively impacts employee focus, morale, and overall work quality 

As far as takeaways go, this report goes over what you can do right now to help your employees and set your business apart.

Starting with:

• Identify the biggest financial stressors your employees are dealing with. Struggling to pay for meds? Gas prices too high? Cash flow issues? Use this report to guide and inform you. ݁

If you'd like to speak with a real person to learn more about empowering your employees, financial wellness programs, Earned Wage Access, or how ZayZoon can help alleviate your employees' financial stress, please don't hesitate to reach out. We're always happy to have a conversation.