A recent survey highlights the financial challenges faced by many UK workers.
- Data reveals that 23% of UK adults have run out of money before payday.
- Young workers and those in lower-paid roles are particularly affected.
- Many are resorting to loans, extra work, or moving in with family to cope.
- Recent government changes aim to address some related financial issues.
The ongoing cost of living crisis has resulted in nearly one quarter of UK workers experiencing financial depletion before their next paycheck, as highlighted by a recent survey commissioned by HR and payroll provider Ciphr. The study surveyed 2,000 UK adults and found that 23% encountered financial shortfall before payday at least once this year. This not only affects employed individuals but extends to 36% of the unemployed and 42% of students, indicating a widespread issue.
Younger workers are disproportionately impacted by these financial strains. Employees under 34 are more likely to incur loans or relocate with family to mitigate expenses, with 25% of those aged 18-34 having taken these actions compared to the average of 10%. Furthermore, 29% have continued to work through illness due to the financial repercussions of taking sick leave, with this figure rising to 55% among 18-24-year-olds.
The survey underscores the insufficient provision for sick pay, with many workers having no access to adequate company sick pay and relying instead on statutory sick pay (SSP), which currently only becomes available from the fourth day of illness. However, anticipated government reforms are expected to improve this situation by offering SSP from the first day of illness and removing the minimum earnings threshold, thus benefiting lower earners and part-time employees significantly.
Claire Williams, chief people and operations officer at Ciphr, commented on these findings, suggesting that while the proposed changes to the SSP system are a positive step, there is room for further enhancements. Williams emphasised the need for employer responsibility in supporting both the mental and financial wellbeing of employees through flexible work practices and health-orientated benefits, which can alleviate the stress of financial instability.
In response to these financial pressures, workers are adopting various strategies to bolster their finances, such as reducing household expenditures, cutting insurance coverage, and altering pension contributions. Approximately a quarter of employees are exploring higher salaried roles or taking additional hours, with some taking on side jobs to enhance their income. Notably, 15% of workers over 55 have delayed retirement, reflecting the pervasive impact of financial uncertainty across different age groups.
The survey illustrates significant financial challenges faced by the UK workforce, with ongoing reforms and employer support needed to mitigate these difficulties.
