In a survey of more than 6,000 full-time employees in the Philippines, financial pressure was ranked as the second source of stress during the COVID-19 pandemic (the first one being fears of the COVID-19 virus).
Organizations that fail to address financial stress are more likely to encounter poor work performance. This is because a team member who is overwhelmed by money worries will most likely experience a decline in physical and mental health and productivity, specifically:
- Physical ailments such as headaches, gastrointestinal problems, diabetes, high blood pressure, and heart disease. In countries without free healthcare, money worries may also cause a person to delay or skip seeing a doctor for fear of incurring additional expenses.
- Insomnia or sleep difficulties due to worrying about unpaid bills or loss of income.
- Weight gain or loss. A person may resort to overeating to cope with financial stress, or may even skip meals to save money.
- Depression. People who struggle with debt are three times more likely to feel down and hopeless, and struggle to concentrate or make decisions.
- Anxiety. Uncertainties about one’s financial situation may leave the person feeling vulnerable and distressed. Also, constantly worrying about unpaid bills or loss of income can trigger anxiety symptoms such as a pounding heartbeat, sweating, shaking, and even panic attacks.
- Relationship difficulties. Money is often cited as the one of most common issues couples argue about. Left unchecked, financial stress can make one angry and irritable, cause a loss of interest in sex, and destroy the relationship if differences cannot be worked out in a constructive way.
- Social withdrawal. Financial stress can cause an individual to withdraw from friends, curtail their social life, and retreat into their shell — which will only aggravate stress.
- Unhealthy coping methods. Money stress can lead to drinking too much, abusing prescription drugs, taking illegal drugs, gambling, overeating, or suicidal ideations and self-harm.
- Increase in absenteeism. Absenteeism is defined as the practice of regularly staying away from work without good reason. According to the 2020 Financial Stress Survey conducted by John Hancock, a U.S-based insurance company, the average number of work days missed due to financial stress more than doubled from 2019 to 2020.
- Reduced productivity. This is because even if employees are not missing work, they are bringing the worry to work, which has an impact on productivity and related cost to employers. Nearly 6 in 10 workers say they worry about personal finances at least once a week at work, and in terms of lost productivity, the John Hancock survey said that the amount of time spent brooding over personal finances at work equates to over 47 hours per year (equivalent to six working days) .
“The average number of work days missed due to financial stress more than doubled from 2019 to 2020.”John Hancock 2020 Financial Stress Survey
Additionally, there is a cyclical link between financial stress and mental health problems:
- The decline in mental health makes it even harder to manage money because the person may find it harder to concentrate or lack the energy at work to tackle a mounting pile of bills. Or they may lose income by taking time off work due to anxiety or depression.
- These difficulties managing money lead to more financial problems and worsening mental health problems.
When employees receive help and support for their financial stress, they become more focused at work and experience improved overall well-being. Download our free Achieving Financial Wellbeing toolkit https://bit.ly/MN_financialtoolkit to learn how you can help your employees increase their financial health, meet their short-term and long-term financial goals, and balance today’s challenges with tomorrow’s needs.