What impact has Covid-19 had on employees finances?
The past year has brought with it many challenges. From job losses to furlough, through to lockdowns and businesses closing, no one could have predicted quite how tough it has been. And, with all of this, it was inevitable that people’s finances would also be impacted. But was this impact negative or positive?
According to a recent survey, 38% of adults have seen their financial situation overall worsen because of Covid-19 and 15% have seen it ‘worsen a lot’1. This is no surprise after Government restrictions forced businesses to close their doors leaving many without work for over a year. As many households faced a drop in their income, this resulted in bills not getting paid, more borrowing and greater financial uncertainty.
However, when the retail and hospitality industries were forced to shut their doors, many peoples spending habits changed and for some, their spending significantly reduced. On top of this, those forced to work from home, saw their travel costs cut. This meant that some households were actually better off financially, with opportunities for their savings to build.
As an employer, what should you be aware of?
When an employee is financially stressed, it can often have a knock on effect on their work and your business. Some find it harder to concentrate or are easily distracted by their personal issues, whilst others can’t even face turning up to work. As an employer it’s important to spot the signs and provide help where necessary.
And, for those who are financially better off from the pandemic, you shouldn’t assume more money means better financial habits. A lot people are not aware of the different saving options available and now as things start to open up again, some may find themselves back to their previous spending ways.
It’s likely that whilst an employee is working for your organisation, they will experience financial hurdles. Whether it’s buying a house, reducing debt, recovering from the pandemic or even approaching retirement, these hurdles can lead to bad financial decisions.
Now more than ever, employees need access to the right tools and resources to support them through these uncertain times and create better financial habits for the future.
A good financial education programme can do just this. In our latest guide, we have revealed our top 5 strategies for a successful financial education programme and what we think works best. Download a copy for free here.
Alternatively, if you would like to find out how the Secondsight financial education programme could benefit your organisation, then contact us here.
Secondsight is a trading name of Foster Denovo Limited, which is authorised and regulated by the Financial Conduct Authority.
Information correct as of 30/06/2021