95% Employers Feel Responsible for Staff’s Financial Wellbeing

The majority of employers feel a sense of responsibility for their staff’s financial wellbeing, with many more now providing financial wellness programmes as a result, confirmed a new study.

Findings from Bank of America’s 11th annual Workplace Benefits Report revealed that 95% of employers feel a sense of responsibility for the financial wellness of their employees; up from 81% in 2015. Additionally more than half (56%) feel extremely responsible. The report also found that over the last year, more employers are offering financial wellness programmes (46%, up from 40% in 2020); and expanding several types of financial wellness support.

FINANCIAL WELLBEING SUPPORT

More than two-in-five employers now offer access to financial advisors (47%); support for developing good financial habits (45%); and access to financial products or services (42%). That’s up from 40%, 39% and 33% in 2020, respectively. As the workforce becomes increasingly diverse, employers are taking a more holistic approach to programmes that address their employees overall wellness. In fact, 72% of employers offer diversity and inclusion programmes or plan to in the next one-to-two years; and 55% are taking steps to support an intergenerational workforce. The approach appears to be paying off; with 57% of employers saying that providing resources to help employees manage their overall wellbeing has driven increased productivity. 

“The role of workplace benefits and wellness programmes in improving employees’ quality of life is more important than ever; and it’s encouraging to see higher reported wellbeing among employees amid the pandemic,” stated Lorna Sabbia, Head of Retirement and Personal Wealth Solutions for Bank of America. “While we should celebrate the increasing prevalence and expansion of these programmes, more can still be done to empower and support employees’ throughout their often complex financial journeys.”

DEBT & GUIDANCE

Other key findings show that:

• Employee feelings of financial wellness are rebounding. As employers continue their efforts to improve wellness initiatives, 51% of employees rate their financial wellness as good or excellent; up from 49% in 2020, and making progress toward pre-pandemic levels in 2019 (55%). 
• Younger employee populations have more gender and ethnic diversity. Women make up 69% of Generation Z and Millennial (ages 18-44) employee groups compared to 51% of Baby Boomer and Silent Generation employee groups (ages 55+). Younger employee populations are significantly more ethnically diverse as well. 
• Workplace benefits programmes must go beyond financial topics. Employees say their mental (60%), physical (54%) and financial (46%) health significantly impacts their overall wellbeing; yet only one-third of employers communicate about mental and physical health more than twice a year. 
• Healthcare is an area for improvement. Only 35% of employers offer a high-deductible health plan which would give employees access to a Health Savings Account (HSA). Among eligible employees, the use of HSAs is significant; with 68% of Gen Z and Millennial employee groups contributing to their HSA, 84% of Generation Xers (ages 45-54), and 74% of Baby Boomer and Silent Generation employee groups. 
• Debt remains a challenge. Around 88% of Black/African American employees, 87% of Hispanic/Latino employees, 81% of White/Caucasian and 60% of Asian employees currently hold some type of debt. Employers are responding to this challenge, as 53% now offer help with debt as a part of their financial wellness programme; up from 15% in 2013. 
• Employees crave professional advice and guidance. Employees listed access to a financial advisor, information on retirement plans and help developing financial skills and good financial habits as the top three areas where they desire greater support from employers.

ETHNICITY & GENERATION IMPACT

The report also found that financial wellness and stress levels vary based on employees’ ethnicity and generation. Younger generations entering the workforce are more ethnically diverse; and both age and ethnicity play a critical role in employees’ sense of financial stress and wellness. For example, the findings revealed that:

• Employees across various ethnicities reported fairly consistent levels of overall financial wellbeing. However 40% of Black/African American, 38% of Hispanic/Latino, 26% of Asian and 22% of Caucasian employees say financial stress negatively impacts their productivity at work. 
• Younger generations are lagging their older counterparts when it comes to financial wellness. Less than half of Gen Z/Millennials (48%) and Gen X (48%) rank themselves as financially well; compared to 58% of Baby Boomers/Silent Generation. 
• Gen Z/Millennials (93%) and Gen X (94%) were also more likely to say they feel stress when thinking about their financial situation; when compared with Baby Boomers/Silent Generation (84%).

GENDER VARIATIONS

Women continue to lag men in financial wellness and in their feelings about financial wellness and preparedness, revealed the report. Around 47% of women rate their financial wellness as good or excellent, compared to more than half of men (57%). Additional differences between men and women include:

• 92% of women feel some level of stress about their financial situation, compared to 88% of men. Women are also twice as likely to be kept up at night by financial stress (11% versus 5%). 
• Women are more likely than men to have credit card debt (53% versus 43%) and to have student loans; (25% versus 17%). They’re also more likely to be adversely affected by this debt. Around 59% don’t have control over their debt (compared to 50% of men); and 32% say debt impacts their ability to achieve their goals, compared to 23% of men. 
• Saving for retirement is the top financial priority for men and women alike; however a smaller percentage of women are prioritising saving (34% compared to 46% of men).

“As the age, gender and ethnicity of workforces becomes more diverse, the variations of support needed by employees will continue to expand,” concluded Kevin Crain, Head of Workplace Solutions Integration at Bank of America. “We believe a more diverse workforce will look to employers to provide tailored solutions for help in achieving their goals. Through programmes such as our Financial Life Benefits offering, Bank of America is committed to partnering with employers to embrace diversity and provide wellness programmes catering to the unique needs of all employees.” 

BUSINESS CASE FOR PROVIDING SUPPORT

Another new study has demonstrated a clear connection between employee financial wellbeing and workplace productivity. Click here to read more.