Half of workers say that their current financial situation is affecting their mental health, according to new research from Aviva.
This report shows that a deepening debt crisis and the rising cost of living is having a significant effect on employee wellbeing in the workplace.
Aviva’s ‘Age of Ambiguity’ report — which has been tracking employee wellbeing from before Covid 19 — found that four out of five (79 per cent) workers were concerned about the increasing cost of living. Around one third of workers said they were just getting by financially, while a similar proportion (34 per cent) said they did not feel they were financial prepared for unforeseen life circumstances, be it illness, accidents or redundancy.
Aviva said that this situation was particularly marked among lower income employees and women in the workplace.
Nearly a third (30 per cent) of employees on lower incomes (under £30,000) said current debt levels were detrimental to their wellbeing. And six out of 10 of those earning under £24,000 said the current financial situation was impacting their mental health.
Meanwhile less than half (49 per cent) of women described their financial wellbeing as good, compared to 67 per cent of men. Women are also more likely to be concerned about their finances in light of the increases to the cost of living, than men (81 per cent to 76 per cent).
In total three quarters of all employees that have experienced a reduction in their income said they had experienced additional stress as a result.
Aviva says that its report shows feelings of financial distress were widespread even before the economic and political upheaval that has heightened during the Autumn.
The report highlights the role employers can play in helping employees with their personal finances and financial wellbeing. Aviva says open conversation around money, and signposting support that is available, will help to make sure a range of people across different incomes, ages, genders and other groups are catered to.
It adds that employers can also provide support for employees’ broader mental wellbeing. This support can come in the form of employee assistance programmes or provision of mental health and wellbeing apps, but most importantly, by offering a culture where employees feel able to talk about mental health without fear of discrimination or judgement.
Aviva UK Health medical director, Dr Doug Wright says: “The relationship between debt and mental health is long established, but in these challenging times, employers need to be closely attuned to their employees’ financial wellbeing, signposting help for those who need it but are unsure of where to find it.
“Being financially responsible does not necessarily guarantee stability – even for people who are experienced with budgeting, the current cost of living crisis is presenting new challenges to their personal finances.
“Employers should look to offer support that bolsters employees’ confidence, as well as offering practical solutions that appeal to their full breadth of employees. Workplace education campaigns about personal finances, including credit ratings and budgeting, can be a great way of helping people feel more secure with their monthly pay cheques.”