When was the last time you worked through vacation or typed an email to your boss from the dinner table?
The modern-day office has turned into any place you can take a smartphone, and employers have set expectations for “always on” access to employees.
According to the United Nations, 86% of males and 67% of females work more than 40 hours per week in the U.S. And Millennials, which make up the majority of the workforce, are hit the hardest: 60% are expected to be accessible off-hours, while 70% work up to 20 hours or more outside the office each week.
This begs the question: Are employees getting back what they’re putting in?
Employee stress is incredibly high, with three out of four employees reporting work as stressful. Businesses have aimed to soften the demand and ease stress through a variety of measures. Some are implementing nap rooms, basketball courts, yoga classes, and gourmet food to create a pleasant working environment and happy employees in and outside of the office. But the reason these flashy perks won’t be successful is because financial concerns are the most widespread cause of stress for workers.
A recent study found that companies acknowledge financial stress is a major concern for employees as 61% of HR respondents reported employee financial health as “fair,” “poor,” or “very poor.”
Financial stress is not good for businesses or employees. Studies have found that stress can cause “higher health care costs, more sick days, and a short working lifespan” for employees. These facts translate to a $300 billion per year cost to employers.
Nap rooms and yoga classes are not going to resolve concerns like paying rent, chipping away at student loans, or avoiding those ominous overdraft fees from banks. Rather than devoting resources to luxury perks like high-grade sushi and massages, businesses need to focus their employee aid on the core of employee stress: finances.
Consider these tips to reduce employees’ financial stress and your overall costs as a result.
A low credit score causes immense stress by putting employees at risk for financial exploitation and penalizing individuals with high banking and credit card fees. Credit scores above 650 will generally allow employees to purchase their desired cars and homes and avoid high fees from banks and credit cards. Help them achieve these goals by bringing in experts that can advise individuals on ways of improving their credit.
Debt is a national epidemic, with U.S. debt reaching $11.52 trillion–and rising. One in three U.S. adults (that’s 77 million people) have accounts that are “in collections.” Debt can be a crushing weight on the soul, so help your employees out with debt reduction strategies and tactics.
If you don’t offer a 401K or pension plan, do it. And if you do, be sure your employees understand how to use them optimally. Too many companies make the mistake of simply offering a 401K as part of a checklist, but they also need to walk their employees through retirement planning and investments.
Retirement plans like 401Ks are terrific, but most Millennials are more worried about paying the rent rather than planning their retirement. Be sure to implement budget management, credit monitoring, and adjustment services that are more geared toward your younger employees.
Real-time work deserves real-time payment. This is the generation of instant gratification, and wages should be included in this category. Employees are looking for compensation benefits that are far more instantaneous and can help them achieve financial peace of mind.
Rather than compensating employees every two weeks, or dangling the possibility of a bonus three months down the line, both sides should evaluate the benefits of a real-time pay model. Mobile apps for payroll enable employees and employers with instant insights into how much an employee works and is entitled to daily–it’s time we start leveraging technology to bring real-time pay to the masses.
Don’t get me wrong, at 22 I would have loved my employers to foot the bill for lunch as well as a gym membership to burn it off later. But it appears these perks are not addressing the primary challenge for employees, which is managing their finances.
Reward your employees for working longer hours with financial guidance and accessibility, and you in turn will be rewarded with happier, and therefore more productive and affordable, employees.
—Ram Palaniappan is the CEO of Activehours. He previously ran RushCard and pioneered direct deposit onto prepaid cards as an alternative to check cashing.