by Blake Fussell
Dubbed the Great Resignation, many low-wage employees have quit their jobs to find a new way of combating rising living costs. This has created a struggle for businesses to hire and retain employees, but one study showed that increased benefits could be a step in the right direction.
These past few years have showed how important frontline, low-wage employees are to their communities, as well as how underinvested many businesses have been in that sector. Some companies have already seen the value of improving benefits, which adds to take-home income even when employee wages are low.
According to a recent Mercer report addressing low-wage earning employee concerns, the top one is “Benefits that enhance economic stability. While pay is clearly a priority for workers who worry about covering monthly expenses, benefits can enhance take-home pay.”
Who has the greatest need when it comes to financial support and literacy?
Low-wage workers make up 44 percent of the U.S. workforce and are at the highest risk of not having their needs met. The Mercer survey showed that those with a household income below the median ($67,521) were offered fewer benefits than those with a higher household income.
Additionally, only 39 percent of below-median workers received six or more benefits, compared to 59 percent that made above the median. Part-time employees received the fewest benefits by far, according to the Mercer study, receiving six or more benefits just 13 percent of the time.
For employers, understanding that 21% of workers in low-wage jobs report that their high levels of financial stress negatively impact their productivity and job should be of serious concern. However, this also provides employers with a tremendous opportunity to improve presenteeism and improve the lives of their people.
What does it look like to provide low-wage workers with financial tools?
Jill Gilboy-Burton is the marketing director of BrightDime, a company that offers a financial wellness platform to employers. The platform has a wide variety of tools to help employees achieve financial stability.
One of the most vital tools an employer can leverage for low-wage earners is financial coaching, where employees get financial advice and expertise they may otherwise never have had. Tapping into solutions such as BrightDime allows employees an opportunity to learn about financial stability and what their options are to help enhance their earnings.
“One of the greatest things we offer employees is unlimited financial coaching with an expert,” Gilboy-Burton said. “They can reach out to an expert as many times as they want and the expert can help them make a budget, set goals and the coach always checks back in with them to make sure they are on their way.”
Through BrightDime, employees can link all of their financial accounts into the platform. With all of their information in the same place, employees have been able to view their goals, where to decrease spending and how to help improve their credit score.
Gilboy-Burton called BrightDime an all-in-one program used primarily by companies and their benefits consultants, designed for employees. While low-wage workers are often left behind when it comes to financial wellness, BrightDime’s model steps in to assist in whatever way the employee needs.
“It’s financial empowerment. All of our education on the platform is tailored to help the employee grow and learn on the topics that interest them the most,” Gilboy-Burton said. “It reduces employee stress. When employees are less stressed they get less sick. For companies, it decreases healthcare costs.”
Employers also benefit from financial coaching. By increasing employee engagement and reducing employee stress, company culture is improved to where the business can be run more fluently. By increasing morale, top-talent employees have shown to retain their jobs more frequently with programs like BrightDime.
The financial coaching benefit has been sought after by employees in recent years, according to Gilboy-Burton. While each employee will have specific needs, coaching presents a roadmap for the employee about how to meet them.
“It can also help employees develop their 401k,” Gilboy-Burton said. “It can help with on-time retirement. Coaches can inform them on how much to put away, show them what they already have set up. It creates a roadmap for retirement.”
According to BrightDime, 71 percent of employees said that their biggest stress in the workplace is uncertainty about money. 20 percent of those employees said they missed work in the last year to manage finance-related stress.
57 percent of employees told BrightDime that financial education has helped increase their productivity in the workplace. Education programs like BrightDime were also admired by human resources professionals, 66 percent of which said that programs like it are some of the most important benefits offered by employers.