COVID-19 shifts focus to "financial well-being" of workers
The "Future of Pay" study by HR service provider ADP increasingly focuses on the "financial well-being" of employees and the associated challenges for employers.
Employee financial well-being is a key determinant of performance and thus has a direct impact on the organization, 98 % of employers agree. Most importantly, employee financial health impacts turnover, as 53 % of employers indicate, engagement (62 %) and productivity (67 %). This is according to the "Future of Pay" study by HR services provider ADP. The Corona Crisis and the anticipated economic downturn are putting increasing focus on employee financial well-being and the challenges it poses for employers.
Measures that go beyond mere salary payments
The fact that economic well-being affects the overall well-being of employees and is therefore a pressing issue is recognized by the majority of European employers (76 %). 72 % of employers believe that they should take an interest in the financial situation of employees. Nearly two-thirds of companies (64 %) believe that offering financial tools, such as apps that provide insight into financial data or tools to budget and track money, help attract top talent.
Employees are also convinced of the importance of financial well-being. A large majority (59 %) of European employees believe employers should take an interest in this issue, and an almost equal share (62 %) would like to work for a company that actually cares about employees' financial situation. 30 % of employees say the availability of financial management support tools would impact their decision to accept a job. They consider this benefit to be as attractive as various off-cycle compensation opportunities or working in a home office.
Not only financial well-being, but demographic and generational trends and preferences in general are impacting workers' preferred method of compensation. For example, 68 % of Millennials would share personal data with payroll service providers to receive financial management support - an age group that will account for 75 % of all workers globally by 2025. Among Generation X, the willingness to share personal data is 52 % and among Baby Boomers, it is only 32 %.
The importance of financial well-being is increasing
According to Steven van Tuijl, General Manager Germany and Poland at ADP, it is time to focus on the financial well-being of employees: "It is clear that people with concerns about their financial situation are more prone to stress and even physical health problems. The current crisis situation and the threat of economic recession are increasing income concerns. Therefore, it is important that employers not only pay attention to the financial well-being of their employees, but also offer various compensation options to best support them in this area. The study shows that this was necessary even before the current crisis. But the urgency has increased."
