Employee financial health isn’t just an individual problem—it has significant implications for all businesses. Your team deserves to feel confident about their financial future with a secure retirement strategy. All Canadians deserve financial wellness.

Rising costs, inflation, and increasing grocery bills are placing a heavy burden on working individuals. The constant pressure to stretch their income to cover these escalating expenses often leads to heightened financial stress and anxiety. As they grapple with these financial challenges, employees may find it harder to focus on their tasks, leading to decreased efficiency and motivation.

[Report] 70% of U.S. employees say financial stress negatively impacts their work performance

An alarming report from the U.S. shows that over 1,200 workers surveyed revealed concerning trends concerning how financial stress impacts their performance at work.

• 32% of respondents are experiencing mental and physical health impacts due to financial stress.
• 53% would feel uncomfortable discussing financial stress with their employer, increasing to 67% for those aged 55 and older.
• Only 14% of employees feel comfortable discussing financial stress with their employer.
• 66% of respondents are worried about the rising cost of living, with inflation being the top concern for those aged 45 to 54.
• 55% of employees are concerned about their finances.

For financially burdened Canadians, saving money has become difficult.

Approximately one-third of Canadians have indicated that their physical health, mental health, and financial situations have deteriorated or worsened significantly in the last two years. Sixty-three percent utilize their entire net pay, while 30% exceed their net pay, frequently turning to debt or depleting their savings every pay period. 

Financial stress can also spill over into personal relationships, causing tension at home and affecting mental well-being. In extreme cases, it may even contribute to physical health problems due to heightened levels of stress with the pressure to maintain a particular lifestyle, coupled with the inability to manage financial obligations effectively, can create a cycle of stress that hampers job performance and overall quality of life for Canadian workers.

How financial stress is impacting the workplace and career growth

According to a recent report, on average, Canadian workers “spent 33 minutes daily thinking about their finances” while at work, resulting in an estimated $45 billion loss in productivity for employers.

Employees have been carrying their personal financial burdens with them to the workplace, causing a noticeable effect on their focus, productivity, motivation, and overall working hours.

Financial strain can also dampen employees’ eagerness for career advancement and hinder any personal drive to independently seek out opportunities for skill development. A significant portion (26%) of employees reported that financial stress diminishes their motivation to pursue their career aspirations.

How plan administrators can support their workforce.

“As Canadians report worsening physical and mental health, as well as financial pressures — issues that can be further exacerbated by working situations — they are expecting more support from their employers.” – Benefits Canada

Economic uncertainty is an issue that concerns everyone. Regardless of where individuals stand on their path to financial security, the collective benefits of sound advice and planning strategies can significantly enhance the well-being of employees. 

From student loan and debt repayment to retirement savings, investment advice, financial literacy programs, and wellness are vital to the well-being of individual employees and a secure collective workforce.

• Employee Assistance Programs: EAPs are powerful and often underutilized tools that can offer financial wellness, legal aid, adoption and parenting services, stress management, and grief and addiction counseling for workers. Providing comprehensive support for employees’ financial goals is important, but an often underutilized area of Employee Assistance Programs is the access workers get to fully-vetted legal advice without breaking the bank. EAPs are a cornerstone of many benefits plans and should be taken advantage of when dealing with financial stress. 

• Virtual Assistance: Canadians are quickly turning to virtual healthcare platforms for convenient access to mental health support and counseling services. It’s a low-touch and low-cost way for plan administrators to care for their workers.

• Retirement Planning: Retirement is ‘becoming unaffordable’ for many Canadians as they fear their finances won’t stretch far enough. Companies that offer workplace retirement plans can increase employee tenure by up to 5+ years. Common Wealth is the industry’s first low-fee, digital retirement platform that offers affordable group RRSP, TFSA, and DPSP plans that help you attract and retain top talent.

This continued financial strain has undoubtedly spilled over into the workplace, where we can actually quantify and see the harsh realities affecting the productivity of working Canadians and their families. 

Given the ongoing increases in interest rates, inflation, and the alarmingly high cost of day-to-day living, many working Canadians are finding it challenging to manage these factors, which have negatively impacted their professional lives. The need to juggle mounting costs alongside work responsibilities can create a vicious cycle of stress, and ultimately, plan administrators need to leverage the tools they have at hand to better impact their workforce’s mental well-being and productivity.