The Financial Wellbeing Research 2023 highlights emerging trends in workplace financial support aimed at fostering employee resilience against economic risks.
- Research reveals high childcare, rental, and energy expenses as major financial strains identified by employers, with inflationary pressures also on the rise.
- A shift towards enhanced financial education and guidance is evident, with significant growth anticipated in financial coaching and advice offerings.
- Employers are broadening the scope of savings products available, including payroll savings schemes and tax-efficient wrappers like ISAs.
- There is a critical emphasis on increasing employee awareness of available financial resources to encourage proactive financial management.
In 2023, the Reward & Employee Benefits Association (REBA) alongside WEALTH at work published a comprehensive study on the financial well-being strategies that employers can deploy to mitigate economic challenges faced by employees. This survey elucidated the diverse set of financial burdens impacting employees, notably encompassing high child care costs, rent, and energy prices, with significant inflation exacerbating these challenges.
The findings articulated a notable rise in employer recognition of subpar financial literacy as a pressing risk, with two-thirds now viewing it as a significant threat to employee financial stability, up from past data. Despite only 19% of businesses planning to adjust salaries to keep pace with inflation, more than half intend to bolster spending on financial well-being initiatives. The strategic focus is manifesting in increased educational resources designed to empower employees in financial matters.
Furthermore, the study forecasts a near doubling in the proportion of organisations intending to provide independent financial education, advice, and guidance. Currently, a modest fraction of employers provide financial coaching, yet forecasts indicate a substantial surge, driven by a 241% planned increase over the forthcoming years. This trend underscores a shift towards equipping employees with the necessary knowledge to navigate financial complexities effectively.
Additionally, there is a remarkable growth in the provision of savings products within the workplace. Employers are considering a robust array of options like pay-as-you-earn schemes, incentivised payroll savings, share plans, and tax-free savings accounts such as ISAs. The availability of such schemes is indicative of a concerted effort to enhance financial security among employees.
The research stresses the importance of not only providing financial resources but also ensuring employees are well-informed about their availability and utility. Proper education and guidance can serve as a vital catalyst for empowering employees, promoting effective utilisation of available benefits and potentially transforming financial habits.
The shift towards comprehensive financial education and savings incentives marks a pivotal strategy in enhancing employee financial resilience.
