The global pandemic revealed how unprepared the world was for such an event. The inadequacies of healthcare systems and the fragility of supply chains were laid bare. So was the tenuous ability of the working class - and even the middle class - to weather financial hardship.
Employers are in a difficult position, making decisions that would have seemed beyond their purview before. Never have they had such clarity about the importance of a paycheck to employees teetering on the edge. For many, one payday is the difference between making it through another month or experiencing genuine financial hardship.
Employees worried about making ends meet are probably not the most productive in the workplace. It's difficult to focus on work when you're worried about having enough money to pay the heating bill on time.
Employers may think they're doing their part by providing employees with a job and a paycheck. However, they could be doing more. In the process, they might create more productive employees and a more profitable bottom line. Here are a few ways employers can mitigate financial precarity for those who work for them.
Choose Systems That Provide Tools for Employees
Employers routinely make decisions about systems for such things as payroll, communications, and project management. Competition among vendors is fierce, so many strive to make their products affordable for small businesses. They also incorporate features that employers can use to benefit their employees.
For example, Gusto's small business payroll solution includes a free app with a spending account feature that allows employees to gain access to cash between paychecks. The advance is taken out of their next check, but it prevents overdrawn checking accounts - or resorting to payday loans - in the meantime.
An app like this one also addresses a problem many employees face: lack of access to traditional banking. The spending account provides a place for their pay to land and a debit card to use. Employers may be providing the checking account an employee wouldn't otherwise have.
Companies that haven't reviewed their existing systems for a while (or ever) should do so. Take a look at what's out there, specifically seeking those employee-focused extras. Sometimes it costs a business nothing to give their employees tools that make their financial lives infinitely easier.
Provide Opportunities for Financial Education
Employers don't think twice about training employees to use a new piece of equipment or software program. Employees who are proficient at their jobs are productive. Therefore, devoting company resources to help them become skilled is a no-brainer.
Financial precarity can keep employees from being as productive as they can be. Money worries will prevent them from focusing fully on their work. Thus helping employees become more proficient with their finances should be a no-brainer as well. Employers can even bring the classroom to them.
Data shows that financial wellness programs like Enrich offer a substantial ROI as an employee benefit. They lower financial stress and boost employee contributions to retirement and savings accounts. It's a benefit that improves employee retention rates and keeps older workers on track to retire on time.
Employers do what they can to help employees make wise decisions online and on the assembly line. It likewise makes (dollars and) sense to help them manage their personal finances in an informed way. Financial wellness education is an investment employers should be willing to make.
Offer an Employee Assistance Program
Financial insecurity is one of the greatest stressors workers and their families face. As with any cause of stress, employees need to find a way to manage it. Otherwise, it will exact a toll on their mental health, relationships, and their ability to be productive workers.
Employee assistance programs (EAPs) offer screenings, counseling, referrals, and follow-up for workers struggling with personal or work-related problems. Participation is voluntary, confidential, and free of charge to employees.
Programs are designed to help employees with emotional and mental health issues ranging from financial stress to substance abuse. Employers contract services with EAP providers who generally operate virtually. That makes them accessible to both remote and onsite employees and to companies in locations where such services are scarce.
These employer-provided programs typically get high marks from employees. In a time when financial worries and health concerns are so prevalent, they're an even greater employee benefit. EAPs are one more way employers can retain good employees and keep them from falling off the edge.
The pandemic spurred many workers to take a long, hard look at the value of their jobs - or lack thereof. There has been a fundamental shift in priorities from earning the highest wage possible to living life to its fullest.
Even those whose financial precarity makes every day a struggle are seeking employers who care about them. Employers less concerned about their widgets and more concerned about their employees' well-being will reap solid returns on the investment. It is, after all, a job seeker's market right now.
Employers have opportunities to impact their employees' financial security in far greater ways than just handing them a paycheck. Employees keep the doors of a business open. Employers can open those doors to a brighter, easier, and less stressful life for those who walk through them every day.