Reading the Stress Barometer

Most employees, with 86% of Gen Z included, feel anxious about their financial circumstances, which in turn can cause a loss to productivity, according to an annual employee wellness report.

According to the firm’s Wellness Barometer Survey, workers lose more than 7 hours of productivity every week because of their financial worries, while Gen Z reports over 8 hours a week in lost productivity.

Workplace financial strain also contributed to increased turnover of employees, according 78% of leaders. This challenge is expected to exacerbate as younger generations, who exhibit heightened stress levels and expect more support from their employers, gain more prominence in the job market, the researchers noted.

“Among the leaders we surveyed, 75% admit that their company places more importance on profits than employee well-being,” Marthin De Beer, founder and CEO of BrightPlan, said in a statement. “What leaders don’t recognize, however, is that ignoring workers’ needs for financial support is having a sizable impact on their bottom line. Investing in financial benefits isn’t just the right thing to do for your people— it’s also critical to driving business success and longevity.”

The report comes as many retirement plan advisers are focusing more on how to guide plan sponsors toward effective financial wellness options for participants. BrightPlan is just one of a host of vendors, including from recordkeepers and advisory firms, offering wellness programs that provide access to financial educators and, if requested, certified financial planners—with plan sponsors prioritizing the best options, according to a recent DC survey from investment consulting firm Callan.

Disconnect

According to the wellness barometer, a disconnect exists between what workers require and the support provided by employers. Although leaders believed that 30% of their workforce has an “excellent” financial situation, only 12% of employees shared this perception. While 76% of workers expressed dissatisfaction with their company’s financial benefits, 92% of leaders were convinced that their company offered the necessary financial support for employees.

Since workers not getting enough guidance from their employers, many are turning to other sources, BrighPlan reported. According to the report:

Nearly 8 out of 10 respondents say they’ve received bad financial advice, for example from friends (52%), family members (51%), co-workers (43%), and social media influencers (41%). Meanwhile, over half (55%) report that they’ve made financial mistakes based on the misguided information they’ve received.

Due to these factors, many employees are experiencing low levels of financial preparedness, according to the researchers. For example, 38% report having no emergency savings or only enough for up to 2 months, and 42% report unmanageable debt. Nearly half (47%) report saving either nothing at all or less than 10% of their income for retirement.

As a result, employees are facing inadequate levels of financial readiness, as 38% indicated they have no emergency savings or only enough for a maximum of 2 months, while 42% struggled with unmanageable debt. Almost half (47%) admitted to saving either nothing at all or less than 10% of their income for retirement.

“[Companies] need to revisit their benefits and ensure they’re meeting employee expectations — especially if they want to recruit Gen Z talent,” Dan Schawbel, managing partner, workplace intelligence, said in a statement. “These young workers are struggling the most with their financial situation, and they also expect more from their employers in terms of support and benefits.”

BrightPlan’s study surveyed 1,400 workers at companies that have a global presence with 1,000 or more employees in the U.S. in January. All statistics are from an analysis of the survey data performed in March.