AMP’s 2020 Financial Wellness research has found severe and moderate levels of financial stress are impacting 1.8 million Australian workers, with nearly half feeling financially stressed for an average of six and a half years or more.
A statement from the company says that in total, 50 percent of all Australian workers reported some level of stress about their finances.
It states the cost to Australia’s economy due to employee distraction and absenteeism is $30.9 billion annually, noting that those severely and moderately financially stressed are ineffective at work for approximately 7.7 hours a week, and absent for a further 1.2 hours a week through sick days.
AMP says the research, which has been conducted bi-annually since 2014, shows that financial stress has remained a systemic issue in Australian society.
“Those severely or moderately financially stressed have remained above, or close to, two million in every year the research has been completed, and the divide between the financially well and those stressed is getting wider,” the statement says.
…women continue to be more impacted…
The report notes women continue to be more impacted; AMP stating that approximately one in five female employees reported severe or moderate levels of financial stress in 2020, almost double the figure recorded for male employees (11 per cent).
Younger women are particularly at risk, with 23 percent of those aged 18 to 34 reporting severe or moderate levels of financial stress in 2020, almost three times the number of male employees (eight percent) in the equivalent age group.
…Covid-19 is amplifying financial anxiety
The report also notes that Covid-19 is amplifying financial anxiety for the 42 percent of employees who perceive their finances to have been negatively impacted by the pandemic through business and employment disruption.
The importance of education
AMP Director of Workplace Super, Ilaine Anderson says that those who feel in control of their money are measurably less stressed, happier and more productive in the workplace.
But Anderson says that employees also require the knowledge and know-how to achieve their goals.
“And while more employees today than in previous years claim to have good financial intentions, they still often lack the tools, support, information and opportunity to take action. Access to financial education is essential.”
She adds that the research shows that financial education is one of the most used employee benefits when available and that employees place an average value of $1300 on financial education provided by employers.
Yet, she says, only 10 percent of employees report that they’re being offered this kind assistance by their employer.
“There is a very real opportunity for employers to offer more financial literacy and education programs to their people … to help them understand and engage with their finances, set goals, put plans in place, and then achieve their desired financial outcomes through informed decision making.”