Almost four in ten employees in professional services have financial worries, impacting their work performance and mental health, according to a major study of the UK workforce.
The survey by Salary Finance saw 37% of professional services workers reporting financial worries, with 47% suffering stress, 32% feeling more prone to panic attacks, and 26% feeling depressed. Accountants, consultants and other similar workers estimate spending 1.9 hours worrying about their finances each week.
Sleeplessness was also a concern for 28% of professional services employees in the nationwide study. Significantly, 26% of respondents stated their work quality was affected by financial worries, and 23% report not finishing daily tasks as a result.
In the extensive study of over 10,000 people from 25 sectors, respondents in the sector were more likely to say that financial worries were causing them stress and negatively affecting their quality of work, compared to the overall average. Salary Finance has created a short video to demonstrate the impact of financial worries in the workplace.
Surprisingly, the research showed little correlation between rates of pay and levels of financial worry, meaning that higher salaries don’t necessarily mean fewer money troubles. Forty-nine percent of those earning over £100,000 a year had money worries, compared with 40% of people overall.
The study identified that how people spend, save and borrow are key to whether or not they have financial worries. Respondents were asked ten questions about their money habits, resulting in a financial fitness score from 1 (‘Not in Control’) to 5 (‘Financial Freedom’). Eighty-two percent of those with a score of 1 had money worries, versus only 8% of those with a score of 5.
Those scoring lower were more likely to run out of money before being paid, causing reliance on short-term, high-interest borrowing including payday loans. Fifty percent of the professional services workers questioned scored ‘3’ or below.
Low levels of financial literacy also emerged, with ISAs, pensions and income protection ranking as the least well-understood financial products.
Having ‘no money to plan’ and ‘no-one to trust’ were the most common reasons given by participants for not getting to grips with understanding finance.
Salary Finance has used this research to develop a Financial Fitness Improvement Toolkit for employers who want to improve the financial wellbeing of their employees, potentially saving up to 17% of their annual salary costs.
Asesh Sarkar, co-founder and CEO of Salary Finance, said: “This research shows that personal money worries are having a real impact on employee wellbeing and performance, as well as business productivity. However, it also indicates that higher levels of financial literacy and access to responsible finance have the potential to improve the situation.
“In this groundbreaking study we have developed a Financial Fitness Score which is a quantifiable objective measure and can act as a KPI. CEOs and HR professionals can use this to benchmark how they are performing versus their peer group. More importantly, this study identifies what employers can do to improve their fitness score KPI and reduce the cost of ‘financial unwellbeing’ in their business.
“Employers in the professional services sector are in a unique position to provide support on both fronts, through financial education, salary-deducted savings and loans, to help employees increase their financial fitness and ultimately get their finances in shape. The added dividend for businesses comes in the form of a healthier and more productive workforce.”
Across all sectors, 77% ‘trust their employer to keep their personal financial situation private from their colleagues and manager’, and 45% ‘would value a low-cost loan from their employer.
Salary Finance partners with employers to offer employees a range of salary-linked benefits designed to help them get their finances in shape by improving financial wellbeing, saving money and borrowing responsibly.