In collaboration with and commissioned by June 25 2014 How do HR professionals rate the overall financial health of their employees Roughly threefifths 61 of HR professionals consider their overall employees financial health to be ID: 730174
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Slide1
SHRM Survey Findings: Employee Financial Stress
In collaboration with and commissioned by
June 25, 2014Slide2
How do HR professionals rate the overall financial health of their employees? Roughly three-fifths (61%) of HR professionals consider their overall employees’ financial health to be no better than fair (50% fair, 10% poor and 1% very poor
), and 38% describe it as “very good” or “good.” Organizations
with greater proportions of hourly employees were more likely to indicate that their employees’ overall financial health was "fair," whereas organizations with fewer hourly workers reported better financial health among staff.
What age group is most likely to experience financial stress?
Fifty percent of HR professionals indicate that people in the 25-34 age range experience the most financial stress. Twenty-nine percent of HR professionals reported employees between 35 and 44 years as the age group to experience the most financial stress. How financially literate are employees? The majority (70%) of HR professionals report employees as being “somewhat financially literate.” Thirteen percent describe their employees as “very financially literate,” but 17% are considered to be “not at all financially literate.” Organizations with a smaller proportion of hourly employees were more likely have employees rated as “very financially literate,” whereas organizations with a greater proportion of hourly employees were more likely to have employees rated as “not at all financially literate.”
SHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Key FindingsSlide3
What financial benefits do organizations offer their employees? Nineteen percent
of organizations offer employees loan products from a third-party provider, and 18% of organizations offer payroll advances. What impact do financial benefits have on employees’ overall ability to manage their financial difficulties?
Nearly three-quarters of HR professionals indicated that offering third-party provider loan products has a positive impact on employees’ overall ability to manage their financial difficulties,
and
slightly over one-half of HR professionals reported pay advances having a positive impact. What types of services are organizations offering to help employees manage their finances? The most common financial services that organizations offer employees are retirement planning and consultation (81%) and financial literacy training for investing (42%). Less prevalent financial services include financial literacy training for basic budgeting (25%) and credit score monitoring (8%). SHRM/Elevate: Employee Financial Stress ©SHRM 20143Key Findings (continued)Slide4
Employees’ struggling to gain control of their finances may have significant ramifications in the workplace. A combined 61% of HR professionals describe the overall financial situation of their
employees as no better than fair (50% fair, 10% poor and 1% very poor), signaling that financial issues could be a growing challenge for employees in many
workplaces. Anxiety related to finances could be a growing source of employee stress that has a direct impact on health care costs, absence and productivity. Thus money management strategies, including budgeting and investing, may increasingly be considered as a part of workplace stress management and wellness initiatives.
Undoubtedly, one major area of discussion for organizations will involve employees’ compensation.
Though wages have not grown significantly in recent years, high levels of financial stress could eventually give way to greater wage pressure, especially for jobs that are difficult to fill. In addition, increased financial stress among the rank and file could influence the debate on executive compensation.Organizations may want to reevaluate their benefits program to fit the needs of their staff. HR professionals report that a portion of Millennials are the employees most likely to experience financial stress in their organizations. Demographic differences in the financial challenges of employees could potentially be a source of intergenerational tension or conflict and could affect how financial benefits are tailored to different age groups within the workplace.
SHRM/Elevate: Employee Financial Stress ©SHRM 2014
4What do these findings mean for the HR profession?Slide5
SHRM/Elevate: Employee Financial Stress ©SHRM 20145
The State of Employee Financial StressSlide6
Overall Employee Financial Health SHRM/Elevate: Employee Financial Stress ©SHRM 2014
6
Note: n = 383. Respondents who answered “don’t know” were excluded from this analysis. Percentages do not equal 100% due to rounding.
Organizations with greater proportions of hourly employees were more likely to indicate that
their employees’ overall financial health was “fair.”
Organizations
with fewer hourly workers were more likely to rate their
employees’
financial health as
“good.”Slide7
Employee Financial Health Rating: Fair and Good Ratings(by percentage of hourly employees) SHRM/Elevate: Employee Financial Stress ©SHRM 2014
7
Note: Respondents who answered “don’t know” were excluded from this analysis. Slide8
Most Financially Stressed by Age
SHRM/Elevate: Employee Financial Stress ©SHRM 2014
8Note: n = 409. Respondents who answered “don’t know” were excluded from this analysis
. Percentage do not equal 100% due to multiple response options. Slide9
Overall Employee Financial LiteracySHRM/Elevate: Employee Financial Stress ©SHRM 2014
9
Note: n = 391. Respondents who answered “don’t know” were excluded from this analysis.Slide10
Employee Financial Literacy (by percentage of hourly employees)SHRM/Elevate: Employee Financial Stress ©SHRM 2014
10
Note: n = 378 Respondents who answered “don’t know” were excluded from this analysis
. Percentages may not equal 100% due to rounding.
Slide11
SHRM/Elevate: Employee Financial Stress ©SHRM 201411
Financial Stress in the WorkplaceSlide12
Financial Stress and Employee AbsenteeismSHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 352-396. Only respondents who answered “strongly agree” and “agree” are shown. Respondents who answered “don’t know” were excluded from this analysis. Only statistically significant differences are shown.
59%
HR professionals
agree that
employees at their organization have missed work due to transportation
issues in the last year.
37%
HR
professionals agree that employees at their organization have missed work
due to
a financial
emergency in the last year.
Larger organizations are
more likely than
smaller organizations to
agree that their employees have missed work
due to
a financial emergency in the past 12 months
.
500 to 2,499 employees (40%)
1 to 99 employees
(17%)Slide13
Employee Termination Due to Employee Financial IssuesSHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 189. Respondents who answered “”I’m not sure, but I don’t think so,” “I’m not sure, but I believe yes” or “don’t
know” were excluded from this analysis. Slide14
Employees Seeking Assistance from Their EmployerSHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 349-374. Only respondents who answered “strongly agree” and “agree” are shown. Respondents who answered “don’t know” were excluded from this analysis. Only statistically significant differences are shown.
47%
HR professionals
agree that
employees
have approached a manager or supervisor for personal financial advice in the last year.
53%
HR
professionals agree that employees
have approached a representative of the organization asking for a pay advance in the last year.
Larger organizations are
more likely than
smaller organizations to
agree that their employees have
approached a representative asking for a pay advance in the past 12 months.
500 to 2,499 employees (63%)
1 to 99 employees (25%)
100 to 499 employees (34%)Slide15
Organizations Providing Annual Cost-of-Living Raises to Employees to Keep Up with Inflation
SHRM/Elevate: Employee Financial Stress ©SHRM 2014
15Note: n = 416
. Respondents who answered “don’t know” were excluded from this analysis. Slide16
SHRM/Elevate: Employee Financial Stress ©SHRM 201416
Financial Benefits:
Pay Advances and Third-Party Provider Loan ProductsSlide17
Does your organization offer the following financial benefits?SHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: Respondents who answered “don’t know” were excluded from this analysis. Only respondents
who answered
“yes” are shown. An asterisk (*) indicates that these data were taken from the SHRM 2014 Employee Benefits Report. Slide18
What impact does offering financial benefits have on the overall ability of employees at your organization to manage their financial difficulties?
SHRM/Elevate: Employee Financial Stress ©SHRM 2014
18Note: Only respondents whose organization offers loan product(s) from a third-party provider and/or pay advances as employee benefits were asked this question. Respondents
who answered “don’t know” were excluded from this analysis
.Slide19
SHRM/Elevate: Employee Financial Stress ©SHRM 201419
Employee Financial Literacy and
Employer-Sponsored Financial ServicesSlide20
Does your organization currently offer the following services to its employees?SHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 398-405. Respondents who answered “don’t know” were excluded from this analysis. Percentages may not equal 100% due to rounding. Slide21
Does your organization currently offer the following services to its employees?SHRM/Elevate: Employee Financial Stress ©SHRM 2014
21
Note: Only statistically significant differences are shown.
Comparisons by organization
sectorPublicly owned for-profit (39%)>
Privately owned for-profit
(17%)
Comparisons by organization sector
Publicly owned for-profit organizations are more likely than privately
owned
for-profit organizations to offer their employees financial literacy training for basic budgeting.Slide22
Does your organization currently offer the following services to its employees?SHRM/Elevate: Employee Financial Stress ©SHRM 2014
22
Note: Only statistically significant differences are shown.
Comparisons by organization
staff size500 to 2,499 employees (32%)>
1 to 99 employees (14%)
Comparisons by organization staff size
Organizations with 500 to 2,499 employees are more likely than organizations with 1 to 99 employees to offer their employees financial literacy training for basic budgeting.
Comparisons by organization
staff size
2,500 to 24,999 employees (41%)
>
1 to 99 employees (14%)
100 to 499
employees (15%)
Organizations with 2,500 to 24,999 employees are more likely than organizations with 1 to 499 employees to offer their employees financial literacy training for basic budgeting.Slide23
Does your organization currently offer the following services to its employees?SHRM/Elevate: Employee Financial Stress ©SHRM 2014
23
Note: Only statistically significant differences are shown.
Comparisons by organization
staff size500 to 2,499 employees (54%)>
100 to 499 employees (32%)
Comparisons by organization staff size
Organizations with 500 to 2,499 employees are more likely than organizations with 100 to 499 employees to offer their employees financial literacy training for investing.Slide24
SHRM/Elevate: Employee Financial Stress ©SHRM 201424
DemographicsSlide25
Approximately what percentage of your organization’s employees are paid hourly? SHRM/Elevate: Employee Financial Stress ©SHRM 2014
25
Note: n = 395. Respondents who answered “don’t know” were excluded from this analysis
. Percentages do not equal 100% due to rounding. Slide26
Demographics: Organization IndustrySHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 396. Percentages do not equal 100% due to multiple response options.
Percentage
Manufacturing25%
Professional, scientific and technical services
20%
Health care and social assistance
11%
Finance and insurance
9%
Educational services
9%
Government agencies
6%
Administrative and support and waste management and remediation services
5%
Retail trade
5%
Transportation and warehousing
5%
Information
5%
Accommodation and food services
4%Slide27
Demographics: Organization Industry (continued)SHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 396. Percentages do not equal 100% due to multiple response options.
Percentage
Construction4%
Repair and maintenance
3%
Utilities
3%
Wholesale trade
3%
Real estate and rental and leasing
3%
Religious, grant-making, civic, professional and similar organizations
3%
Mining, quarrying, and oil and gas extraction
3%
Arts, entertainment, and recreation
2%
Agriculture, forestry, fishing and hunting
2%
Personal and laundry services
1%
Other industry
4%Slide28
Demographics: Organization SectorSHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 391. Percentages do not equal 100% due to rounding. Slide29
Demographics: Organization Staff SizeSHRM/Elevate: Employee Financial Stress ©SHRM 2014
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Note: n = 388. Percentages do not equal 100% due to rounding. Slide30
n = 408
Demographics: Other
SHRM/Elevate: Employee Financial Stress ©SHRM 2014
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U.S.-based operations only72%Multinational
operations
28%
Single-unit organization: An organization in which the location and the organization are one and the same.
27%
Multi-unit organization: An organization that has more than one location.
73%
Multi-unit headquarters determines HR policies and practices.
58%
Each work location determines HR policies and practices.
4%
A combination of both the work location and the multi-unit headquarters determines HR policies and practices.
38%
Is your organization a single-unit organization or a multi-unit organization?
For multi-unit organizations, are HR policies and practices determined by the multi-unit headquarters, by each work location or
by both
?
Does your organization have U.S.-based operations (business units) only, or does it operate multinationally?
n = 406
n = 308
Corporate (companywide)
69%
Business unit/division
16%
Facility/location
15%
n = 309
What is the HR
department/function for which you responded
throughout this survey?Slide31
31SHRM Survey Findings: Employee Financial Stress
Response rate = 14%
419 HR professionals from a randomly selected sample of SHRM’s membership participated in this surveyMargin of error +/-5%Survey fielded May 9-June 2, 2014
In collaboration with and commissioned by
Survey MethodologySHRM/Elevate: Employee Financial Stress ©SHRM 2014Slide32
For more survey/poll findings, visit shrm.org/surveysFor more information about SHRM’s Customized Research Services, visit
shrm.org/customizedresearchFollow us on Twitter
@SHRM_ResearchSHRM/Elevate: Employee Financial Stress ©SHRM 2014
32
About SHRM ResearchSlide33
Founded in 1948, the Society for Human Resource Management (SHRM) is the world’s largest HR membership organization devoted to human resource management. Representing more than 275,000 members in over 160 countries, the Society is the leading provider of resources to serve the needs of HR professionals and advance the professional practice of human resource management. SHRM has more than 575 affiliated chapters within the United States and subsidiary offices in China, India and United Arab Emirates. Visit us at
shrm.org.
SHRM/Elevate: Employee Financial Stress ©SHRM 2014
33
About SHRMSlide34
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