When it comes to workplace wellness, the importance of including financial health and wellness in the conversation is crucial. Life is brought to work when employers care for their employees, and that means ensuring they are supported in all areas of their livelihood. This includes managing financial stress, the top stressor for Canadians from coast to coast.
Every September during the Canadian Payroll Association’s National Payroll Week, workplaces across Canada recognize the power of payroll to empower their people. To gain a better understanding of the impact of personal financial wellbeing on the economy, the CPA surveyed over 4,000 Canadian workers in their 2019 National Payroll Week Survey of Employed Canadians. This year’s results emphasized the role of the workplace in mitigating the increasing financial stress endured by employees through supportive financial health and wellness programs.
The weight of employee financial stress
The percentage of Canadian workers living pay cheque to pay cheque remains consistent from 2018, as nearly half (43 per cent) of employees live on their net pay. Approximately one-third of the survey respondents admit that their financial debt has increased since last year, with thirty-eight per cent of those with credit card debt revealing it will take them over a year to pay off their debts in full.
In direct reflection of the employees who work to survive on each pay stub they earn, 43 per cent of workers expressed being so affected by their financial stress that their work performance suffers as a result. So altered is their focus that one-fourth of workers say they spend 40 minutes each work day distracted by their personal finance matters. This results in an 8.1 per cent loss in productivity (based on an eight-hour workday) and in a huge deduction of $16 billion per year in lost productivity.
Judging from the survey’s staggering statistics, the costs of rising financial burdens, which include decreased job satisfaction, morale, absenteeism, and turnover, seem insurmountable. However, there are solutions that companies can implement to overcome the weight of employee financial stress.
Employees want financial wellness solutions
National Payroll Week recognizes the tireless contributions of over 13,000 certified payroll professionals overseeing the pay of over 1.5 million employers across Canada. With big numbers comes the big responsibility of payroll pros to keep employees paid accurately and on time, and to keep their organization compliant at all times.
The onus is on employers to step up and add to the work of payroll professionals by supporting their employees with their financial health, so that financial worries do not detract workers from bringing out their full potential.
Financial health and wellness programs contribute to a healthier workforce by helping employees:
- reduce workplace stress caused by financial concerns,
- prepare for retirement, emergencies, or major life events, and
- grow their financial literacy and feel in charge of their personal finances.
According to the CPA survey, employees want advice on how to improve their financial wellbeing. Nearly 4 out of 5 (78%) of respondents indicated their interest in financial education at the workplace, with saving for the future and budgeting habits as the two most popular topics they wish to see covered.
To encourage proactivity and healthy habits when it comes to financial savings, the “Pay Yourself First” initiative is a safe bet for organizations to implement. The program allows for employees to allocate a portion of their pay cheque (the CRA recommends 10% of one’s net pay) to be automatically deducted and then deposited into a separate savings account each and every pay day. This encourages better money management, a higher rate of savings, and the steady accumulation of emergency and/or retirement funds.
Making an effort to minimize the impact of employee financial stress in the workplace empowers companies and their people to thrive. As CPA President Peter Tzanetakis explains, “much like mental health, for Canadian businesses, actively addressing the financial wellness of employees could provide a competitive edge and deliver bottom-line results.”
Participate in National Payroll Week
Over one-third of employees are participating in “Pay Yourself First” programs, but only 55 per cent of employers offer the program to their workforce.
Rise is participating in the Canadian Payroll Association’s ‘Pay Yourself First‘ program by helping employees automatically save at least 10% of their earnings.
Rise customers can take part by following these instructions on how to direct a portion of participating employees’ pay into an additional account.