How to help make the cost-of-living crisis a little less painful
The Covid-19 pandemic forced every employer to reckon with the importance of workplace wellbeing. No longer a ‘nice to have’ or perk, what many right-minded companies already knew became a mainstream fact: supporting employee mental health is an organisational imperative.
Today, the current cost-of-living crisis demands we go further still, because financial wellbeing is wellbeing and affects everyone.
It’s vital to remember that – just like the pandemic – cost-of-living stresses don’t only unfold outside the office. People take their financial problems to work with them and this makes for some scary statistics.
According to the Money and Mental Health Policy Institute, people in problem debt are three times more likely to consider suicide as those without a debt problem.
Meanwhile, the combination of lost productivity and higher work absences as a result of financial worries costs UK businesses an estimated £15bn a year. In the US that’s $4.7bn a week.
So, while it’s no employer’s duty to solve rocketing costs or eye-watering debt, there are heaps of things they can do to support employees.
Here are three key issues to be aware of:
1. Be prepared for more mental ill-health
Poor mental health isn’t an inevitable result of financial difficulty – in fact, many people show extraordinary resilience in times of crisis. Yet it’s known from past recessions that a population-wide spike in mental health challenges is likely and this includes suicide.
Of course, progressive leaders already know that normalising wellbeing conversations at work – alongside a range of expert tools and services – can help. Armed with the insight that mental ill-health may well increase, it’s time to take stock of what resources there are for every employee.
Ideally, your wellbeing offering should include preventative tools – to support better wellbeing, as well as more specialist services – for staff experiencing a crisis. Yet a human touch remains crucial.
Plan frequent check-ins with employees. Make information accessible across your organisation. And bolster internal communications for your wellbeing services. Paired with a well-stocked wellbeing package, this can start to tackle the link between employee wellbeing and these hard financial times.
2. Give managers skills to talk about finances
The most effective way to reduce someone’s financial stress is to improve their financial situation. And, while many bosses no doubt wish they could do that for staff (whether through inflation-beating pay rises or bonuses), in reality, that’s fantasy.
That said, there’s evidence that signposting, training and awareness raising measures can help. And this starts with empowering managers.
But your managers are not financial advisors. Listening – good listening, active listening – is what’s needed. With three-quarters of employees saying they’ve never talked to their line manager about financial wellbeing, this implies what they need is permission, not a financial plan.
When leaders create a working environment that’s equal parts empathy and understanding, employees experiencing a challenge may feel more safe to open up. How to deliver this? Often, leaders going first – that is, talking about their own mental health challenges – is a reliable way to boost psychological safety among teams.
To ensure your managers approach these conversations with confidence and know-how, we’d strongly encourage investing in training. From there, it’s time to unleash the experts.
Managers play their role here, too – by signposting to the likes of StepChange, Citizens Advice and The Debt Advice Foundation (UK), the National Foundation for Credit Counseling and National Debt Relief (Americas), Money Minded, Better Place Australia and Wisr (APAC), or even just their doctor.
3. Understand finances are an inclusion issue
How people are affected by the looming recession will be influenced by a wide range of factors, including their social group. In 2022, there’s lots of data to show that, compared with their colleagues, minority groups are likely to be paid less and have fewer opportunities for professional progression.
Alongside gender, ethnicity and disability pay gaps, research during the pandemic found working parents (particularly mothers) experienced greater economic stress across income brackets, versus their colleagues.
What does this mean for the workplace? That it’s important to be sensitive to how and why finances affect people differently. Including financial messaging in your diversity and inclusion strategy and recognising that not all employees will be affected equally will go a long way to making your financial health discussions more inclusive.
Want to learn more about financial wellbeing, and how to better support your staff? Download Unmind's free handbook, The Psychological Cost of Living.
Unmind’s global financial webinar series, Money talks: How to protect your mental and financial wellbeing at work is available on demand.
🌍 EMEA recording
In partnership with Unmind
Our vision is to create a world where mental health is universally understood, nurtured&celebrated.
