A new study in the Stanford Social Innovation Review shows that employees’ financial stress has a significant impact on their employers’ bottom lines, and workforce coaches – like those in Workforce Connection – can limit the stress and boost the bottom line.
Workplace benefits, especially those for low-wage workers, “are often framed as a moral issue,” the author writes, but there is also a business case to be made for employers to offer decent wages, stable hours and robust benefits for all employees. Not only are benefits a way for an employer to differentiate itself from competitors, they can ease the ongoing financial stress that causes fatigue, distraction and sloppy performance among employees.
According to the study, Americans at multiple income levels are in a precarious financial position, with minimal savings and an increasing reliance on debt. As a result, American workers spend an average of 150 hours per year worrying about finances while at work. Researchers conducted a series of experiments that demonstrated how financial stress leads to workplace mistakes.
As John Bernloehr, President of Consolidated Metal Products, recently said in a conversation about Workforce Connection: “I don’t know if this is a true axiom or not, but I believe it – a happy employee is a productive employee.” The article in SSIR supports that notion. The author wrote:
“When people are worried about their personal finances, it hinders their ability to be productive and perform. Financial precarity has also been linked to a range of health ailments and conditions, which can further drive down productivity and increase costs. Thus, our research suggests that there is an economic cost associated with widespread financial precarity that is borne by employees and employers alike.”
Researchers found that active intervention was more effective than mere education in reducing stress. For instance, having a workforce coach who can connect a stressed-and-distracted employee to community resources to address an immediate need.
Employees who had access to workforce support programs reported having better sleep, more energy and fewer ailments. “Moreover,” the author wrote, “the program was implemented at relatively low cost … and offered considerable benefits in the form of a healthier and more productive workforce.”