All Mapped Out: How to ensure your employees' wellbeing during an economic crisis
This month, Wellbees CEO Melis Abacioglu hosted a webinar on a topic rarely discussed—and even avoided—regarding employee wellbeing: financial wellness.
Under Wellbees' stewardship, we put together a financial wellbeing roadmap that includes the input of 80+ companies on what's worked and what hasn't. Here, we'll summarise the main insights found by Wellbees' research partnership with PwC and provide actionable suggestions your organisation can take to acknowledge and address the financial wellbeing of your employees.
Kurt Lewin, a renowned organisational psychologist, compared organisations facing substantial change to a melting ice cube. Any big crisis, restructuring, or change melts the ice cube, and then it takes some time for the water to refreeze and retake its new form.
The same applies to all external crises experienced by employees, and when it comes to troubles in recent years, there has been no shortage of them. From COVID-19 to the energy crisis, global inflation, climate change, and the looming economic crises, all of these situations impact the wellbeing of employees both directly and indirectly. Combine this with the fact that 59% of employees in 2023 think their compensation did not keep up with inflation compared to 41% in 2021, and HR professionals feel pressured to find alternative ways to address their employees' financial stress.
Just how stressed are employees these days?
According to Gallup reports, we see that employees are feeling more stressed and burned out than ever. 59% of employees worldwide are "quiet quitting"—putting in the minimum amount of work required, and there continues to be a growing disconnect between employees and their managers. Only 30% of employees say their wellbeing has improved, while 80% of the C-Suite thinks overall employee wellbeing has increased. More than that, managers are struggling too. 43% of middle managers reported being burned out, a data point directly impacting their team members' morale and productivity.
Taking on employee financial health one honest conversation at a time.
So what can we do about this? More specifically, how can employers support employees during an economic crisis and help them better manage their finances so they feel more at ease?
The first step is to measure the following four variables among employees via surveys, focus groups, or during 1-on-1's: financial planning, saving, spending, and borrowing.
By opening up a more transparent dialogue on the above four issues and challenges most employees face regarding their financial health, employers can take more appropriate steps to mitigate or even solve them. The surprising part is that the solutions can come in something other than monetary form.
Take Emma Davies, Masafi CHRO, who approached her employees and asked them what the most significant challenges they faced were regarding compensation. She found that 80% of them were sending money outside the United Arab Emirates to their families, taking half a day off each month to wait in line at the bank, where they had to pay a high commission to transfer money abroad.
To solve this pain point for her employees, she called the four leading banks her employees used and arranged to lower commission fees while streamlining how employees wired this money. This strategy saved all of her employees time off and money while giving her tangible results in costs saved she could take to management.
That's just one example of a concrete step a leader can take to address their employees' financial concerns without necessarily increasing compensation. Let's look at other hard truths leaders must consider when managing their employees' financial worries.
1) Constantly assess your compensation packages.
If you're not paying your people at least market value for their work, no amount of wellbeing initiatives will cut it in the long run. So, suppose you're living in an economy undergoing high inflation or uncertainty regarding the cost of living. In that case, your benefits & compensation team must assess and adjust compensation more frequently.
2) Remove the taboo around the topic of money.
Financial wellbeing is a considerable part of every individual's life, and to ignore it when addressing employee stress and burnout is to leave out a critical piece from your strategy to improve it. That means you need to have those hard, honest conversations about your people's financial challenges, acknowledging the substantial pain points costing them sleep, energy, and productivity and finding creative ways to address them.
3) Create psychological safety with vulnerability.
Because money is an emotionally triggering and taboo topic, it needs a thoughtful approach. In this case, training around financial wellbeing and facilitating hard conversations while keeping psychological safety in mind is highly recommended. Psychological safety correlates with every variable positively impacting employees' sense of connection and belonging to the organisation and their team. We've worked with several large organisations that provided this kind of training for all employees. We have seen incredibly positive feedback from their teams, increasing transparency, communication, and a sense of belonging.
4) Practice inclusive leadership.
Tailor how you talk about economic uncertainty and financial instability to include all genders, ages, and roles. Every employee encounters unique challenges, so rather than assuming what different groups of employees are experiencing, keep questions and conversations open to get an accurate pulse check of what financial stressors and anxieties your people are going through. Then you will have all the information you need to craft a strategy and response that meets their needs.
5) Support your managers so they can support employees.
Managers are burnt out and feeling lonely. They're losing sleep, more anxious, and feel more isolated from their colleagues when compared to their employees. Our research with PwC found that managers' wellbeing correlates strongly with that of their teams; therefore, by providing your manager with more support, resources, and training, you'll see a positive impact on the wellbeing of their team members.
For a deep dive into the full scope of Wellbees' research and findings, click below to watch the entire webinar hosted by Wellbees CEO Melis Abacioglu.