Aviva is urging businesses to focus on support for employees’ financial wellbeing or face increasing pressure to attract and retain talent, as a record 1.17m jobs stand open and more than four in five industry sectors report unprecedented demand for staff.
The call for action comes as new findings from the third instalment of a two-year study into the evolving workplace reveal that only 35% of employees are showing signs of practising good saving behaviours.
Research from Aviva’s report, Evolving in the Age of Ambiguity, highlights the positive influence of good financial wellbeing on individuals and businesses. It shows the associated benefits range from better mental and physical health outcomes to improved feelings of job satisfaction, security and stability.
Yet the findings also reveal that 43% of employees do not feel financially on track to live the kind of life they want in the future. Aviva says the results highlight the need for businesses to better support financial education in the workplace, at a time when rising inflation is likely to mean money matters have a bigger impact on people’s sense of wellbeing and decision-making.
The third in-depth report from Aviva’s study into accelerating change at work – which has been gathering data since before the Covid-19 pandemic started – explores practical steps employees and employers can take to stay on track for healthier financial futures and cope with widespread uncertainty.
The study highlights five key indicators of good saving behaviours in people’s perceptions of their everyday life.
The report warns of significant challenges ahead as nearly 65% employees are showing signs of being financially exposed in at least one area.
65% feel they are ‘just getting by financially’, with 45% typically finding they have no money left over at the end of the month. 28% of employees surveyed feel their finances control their lives.
Looking ahead, 44% of the working population feel their money situation means they will never have the things they want in life. Even more (57%) are concerned the money they have or will save won’t last.
Aviva’s findings seek to address the issue by drawing insights from in-depth qualitative and quantitative research to help employers understand the major influence of personality on people’s saving behaviours.
Among four main personality types examined by the study, ‘Resilient Completers’ – people who are characterised by high emotional stability and conscientiousness – are the most likely to report strong saving behaviours (50%) and are more than twice as likely to do so as ‘Impulsive Worriers’ (24%).
The findings show the ability to maintain good saving behaviours is strongly linked to people’s current and future financial health. More broadly, the feelings engendered by the act of saving also play a significant role in ensuring people’s financial situation does not impact negatively on their mental or physical health.
Employers can also unlock hidden business benefits by encouraging and enabling a saving culture among their staff. The study shows good saving behaviours can result in a number of positive outcomes for firms.
Laura Stewart-Smith, head of workplace savings and retirement at Aviva, said: “The pay-off from practising good saving behaviours extends well beyond a number on a bank statement and being able to afford what you want now and in the future. Our research shows people’s underlying sense of security and wellbeing – physical and mental, at work and at home – can be fundamentally impacted by the act of saving, with potential benefits in almost every aspect of day-to-day life.
“With many people facing financial challenges, these findings present a new opportunity for employers to build deeper, lasting relationships with their employees by taking steps to support their financial education and wellbeing. Saving behaviours are not only good for financial preparedness, they can also empower people in their careers, which has a knock-on effect on their sense of job satisfaction and optimism for the future.
“The fact so many people feel financially exposed suggests there is a mountain to climb, but as people start to plan career moves for 2022, now is the time for businesses to act to support employees’ wellbeing and engagement to boost retention. The majority of people³ recognise their employer is not responsible for keeping staff financially on track, but businesses can play a key role in achieving this goal and reap the collective rewards.”
