Inflation. An energy crisis. The likelihood of an interest rate spike. It’s no surprise that financial strain is now the biggest cause of stress outside of work for UK professionals, according to new research.
A report by employee wellbeing platform Champion Health found that more than a third (34%) of UK employees feel stressed about their finances, with 15% of employees saying worry is affecting their productivity.
Additionally, the report highlights that financial stress is intrinsically linked to mental health. More than half (52%) of people with financial stress reported clinical depression. Research has also correlated financial stress with lower levels of sleep quality and energy.
Leaders may view financial well-being as a personal issue, but as the cost of living crisis deepens, it will inevitably impact the workplace. So what can leaders do to support their teams during this difficult time?
1. Provide financial education
“Financial stress is intrinsically linked to employee well-being and productivity, so improving financial well-being should be a priority,” says Harry Bliss, CEO of Champion Health. “The one practical thing all businesses can do to deal with this crisis is to ensure they provide high quality financial education and support to staff. This can include providing confidential access to financial assistance and also making better use of technology to ensure that all employees can access independent, impartial and trustworthy financial advice.
Professor Sunita Malhotra, who teaches the CEMS Master in International Management at the Louvain School of Management in Belgium, supports this point of view. She says: “Often employers spend money on wellness initiatives like yoga or wellness when it’s not getting to the heart of the issues – which is that a lot of people don’t know how to manage their finance.”
Malhotra recommends businesses seek out independent experts to advise on budget planning, prioritizing expenses, and innovative ways to save money. “They can also organize practical courses or ‘lunch-and-learn’ sessions on resource management such as energy or water and the latest market changes – for example the refinancing of a mortgage – which could help reduce financial stress. ”
She adds: “Ultimately, the cost of hiring a financial consultant or organizing a financial education course is justified, as productivity and engagement will increase, with huge benefits. for the company and the employees.”
2. Beware of stressed staff
“People don’t leave personal stress and anxiety behind when they walk through the door of work,” says David Liddle, CEO of The TCM Group, founding president of the Institute of Organizational Dynamics, and author of Transformational culture. “If someone is under financial pressure and worried about how they are going to pay their bills and feed their family, they will most likely find it difficult to concentrate on their work and will be more sensitive and irritable than usual. This can quickly turn into a conflict with colleagues, with small issues that would usually go unnoticed and escalate into major fallout.
Managers should be alert to signs that a team member may be unusually stressed or distressed. Have they become withdrawn or less communicative, for example, or are they like a powder keg, quick to anger and impatient with others? “If that’s the case,” says Liddle, “try to engage in dialogue so you can get a sense of what’s behind the behavior and reassure them that you’re willing to listen.”
Liddle says it’s also essential to know what sources of help and advice exist, so you can report them appropriately. “Showing care and compassion is essential at a time when many people – even those you might not expect – will be struggling,” he says. “Sometimes just the chance to talk about it can help.”
3. Break the taboo around money
Leaders and managers are in a good position to identify those impacted by financial well-being issues, says Dr. Tanya Boyd, learning experience architect at development expert Insights. Therefore, they can sensitize these people to the possibilities of support. She adds, “Leaders can also help break the taboo around discussing money by asking questions and sharing stories to let employees know they’re not alone and it’s okay to talk about things. their financial challenges.”
To take on this role, leaders must demonstrate an “other consciousness,” Boyd argues. It is the awareness of the strengths, challenges, values, hopes and dreams of others. “Most leaders already know the power of self-awareness for effective leadership, but today it is a leader’s ability and willingness to activate their awareness of others that defines excellence. “, she says. “Two skills are needed to do this well: the ability to ask good questions and the ability to really listen to the answers.”