Is economic stress holding your people back?

Workers are worse off financially than they were a year ago, according to PwC’s 2023 Global Workforce Hopes and Fears Survey, which polled nearly 54,000 employees around the world. Only 38% of respondents said they’re able to pay their bills each month and still have money left over; that figure is down nine percentage points from last year. The share of workers who have nothing left over after paying their monthly bills has jumped from 10% to 14%. Those findings suggest that inflation is having a marked effect on employees’ financial well-being, swelling the ranks of workers who are struggling merely to get by. Given that economic stress has been shown to have knock-on effects on physical and mental health—and, in turn, on workplace retention, productivity and engagement—employers can’t afford to sit tight and wait out the crisis. Immediate action should centre around two key imperatives: 

Reassess compensation and benefits packages. Consider cost-of-living salary increases, for starters. But also scan the competitive landscape: will your compensation packages attract top talent in a time of economic uncertainty—and will they keep your best people from jumping to a better-paying employer? (Indeed, the proportion of workers who say they plan to quit their job in the next year rose to 26% this year, from 19% in 2022.) At the same time, explore customisable benefit packages that have the potential to curb costs while allowing employees to maximise value and security.

Expand wellness initiatives to include financial health. Confidential counselling, debt and financial coaching, and other employee assistance programs can help ease uncertainty and signal to employees that it’s OK to speak up at work about financial challenges and ask for help. Giving employees the tools to improve their financial literacy and manage economic stress won’t fully offset the effects of inflation and other shocks, but it can keep those external forces from being a disruptive workplace distraction—or a reason to eye the exit.