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Employee money stress a “silent epidemic”
How much should employers care if their staff are having money problems?
A lot, says Barbara Bowes, a career specialist who writes a regular column in the Winnipeg Free Press.
When employees have financial woes, their employer is inevitably drawn in whether they can see it or not. The result for the company is lost productivity, higher healthcare costs, reduced profits and lower morale.
Worries about this “silent epidemic” gained urgency from a recent Canadian survey that showed more and more workers are saving less and feeling increasingly stressed by debt.
Astonishingly, says Bowes, 63 percent of young Canadians 18-29 live paycheck to paycheck.
The survey further showed that 29 percent of respondents said personal money worries were a workplace distraction and 48 percent spent work time handling personal financial affairs.
“Although almost unbelievable, one study suggests employees spend up to 20 hours per month dealing with personal financial issues during work time,” Bowes says. “This includes getting calls from creditors, calls from banks about insufficient funds and bounced checks, arranging debt-consolidation loans, worrying about money and simply daydreaming about financial freedom.”
If you add this up for just one employee, “you can just imagine the dollars being wasted from stress.”
Stress causes distractions and unsafe behavior, says Bowes, noting that 60 to 80 percent of workplace accidents are stress-related. Another impact is turnover as “many financially stressed workers are constantly looking for the next new job with higher pay.”
She encourages employers to offer financial education programs (not seminars on how to invest) that teach how to manage money and reduce debt.
The benefits of caring about employees’ financial well-being are numerous, says Bowes: “Less stress, less absenteeism, less turnover, higher morale, higher productivity and an appreciation that the employer cares about the well-being of their employees.” ◆
Evangelicals tackle “predatory lending”
The National Association of Evangelicals (NAE), not widely known for economic activism, has taken on the issue of “payday loans” that charge excessive fees and interest rates.
The agency, which represents 45,000 local churches in 40 denominations, recently approved a resolution on “Predatory Lending” urging churches, lenders and the Consumer Financial Protection Bureau to get rid of debt traps that imprison poor and vulnerable consumers.
NAE president Leith Anderson said the agency was stunned to find that the cost of payday loans can reach 300 percent in some states. He noted that the Bible “speaks strongly against unjust lending and taking advantage of the poor.”
Anderson said some states do not regulate interest rates and vulnerable people with urgent financial needs are lured into short-term, high-interest loans that cannot realistically be repaid and are rolled over from paycheck to paycheck, creating a cycle of indebtedness.
The NAE resolution encourages churches, charities and employers to help with gifts or loans in times of personal crisis, offer financial literacy classes and model the virtues of disciplined saving, delayed gratification and investment for future needs.
Galen Carey, NAE vice-president of government relations, said, “Christians and churches should also advocate for just and responsible practices among lenders and reasonable state and federal regulations that protect the poor in our communities.”
The resolution states, “The NAE calls on lenders to design loan products that do not exploit poor and vulnerable borrowers. We call on the Consumer Financial Protection Bureau to investigate predatory lending abuses and to establish just regulations that protect consumers, particularly the most poor and vulnerable among us, from exploitation.” ◆
