Close Brothers’ latest report highlights that despite escalating cost-of-living concerns among employees, financial wellbeing remains a low priority for many UK companies.
According to the survey, employees’ top concerns are paying for basic living expenditures (36%), worrying about not having enough money for retirement (35%), and handling mortgage or rent payments (32%). On business objectives, however, addressing these challenges comes in low; financial wellbeing comes in at number twelve, while help for cost-of-living difficulties comes in at number eight.
The survey also shows a discrepancy between company offerings and employee needs. Few businesses offer benefits that could significantly raise workers’ financial circumstances. For example, only 37% provide employee shopping discount programmes, 26% offer holiday purchase/sellback benefits, and just 19% provide mortgage advice and hardship loans.
However, some benefits are in line with employee preferences; these include death in service coverage (57%) and pension schemes (74%). But crucial services, like financial guidance (36%) and pensions advice (43%), are rarely offered, despite the fact that employees strongly value them.
The advice gap, which is the large discrepancy between employee requests and employers’ actual provision of financial assistance, aggravates the problem. Just 15% give general financial assistance and only 22% offer financial advice in conjunction with a pension provider for retirement planning, omitting important areas of employee support.
Jeanette Makings, head of workplace financial wellbeing says: “The events of the last three years have wrought a seismic change on working patterns and household finances. The pandemic saw people take stock and focus on their lives, which inevitably also brought a reappraisal of their finances. They recognised the importance of having an emergency fund, and wider financial protection for their family. It also prompted an increase in hybrid working, which saw people move house, or change their lifestyle.
“It is increasingly clear that workplace benefits and financial wellbeing programmes have failed to keep pace with these shifts. At a moment when employees are more engaged than they have ever been with their finances. And with the significant influence financial wellbeing has on mental wellbeing, there are huge benefits for employers that are alive to and agile in making changes to their workplace benefits and wellbeing programmes to better align them with employees’ needs.”
