Nine out of 10 employers expect their workers to experience financial difficulties in 2023, with growing numbers experiencing fuel poverty.
In total 97 per cent of employers expect the numbers of workers experiencing financial difficulties to increase and more than two-thirds (67 per cent) were actively aware of employers already struggling with personal finances.
Fuel poverty is defined as households spending more than 10 per cent of its income on energy. This could mean all families earning less than £30,000 could be in this position when the price cap rises in April. This will mean the cost for average consumption is capped at £3,000.
The survey, by risk management and insurance intermediary Partners& of HR, financial and C-suite professionals found that 59 per cent of organisations employ at least some workers on less than £30,000, with one of four saying most of their workforce are paid below this level.
The research also indicated that rising interest rates will impact people finances and their ability to service mortgage and others debts. The survey found that two thirds (62 per cent) of employers said the combined impact impact of inflation and high interest rates pose the biggest issue for workers in 2023.
Partners& wellbeing and benefits director Steve Herbert says: “It’s clear employers expect 2023 to be a financially challenging one for many or most of their employees. Some organisations remain financially strong and these employers may be able to reward their workers with healthy – possible even inflation matching – pay awards or one-off cost-of-living payments. Yet many others will struggle to make such payments during a potentially lengthy recessions, and will need to find other ways to support their workers.”
He adds that the organisations strongly encourages employers to offer financially wellbeing support to their workforce to help employees better manage their finances through the ongoing difficult period.