Hammered by inflation? Yet 53% of employers have yet to offer financial wellness

Financial stress is rising, impacting nearly half of employees. High rates of inflation (6%) are affecting the vast majority of American workers. Four out of five employees are impacted by the rising cost of consumer goods over the past year. However, new research reports 53% of employees say their employer has yet to offer financial wellness benefits or compensation in response to rising prices caused by inflation.

FinFit, merging with Salary Finance, gathered their findings for their Inside the Wallets of Working Americans report. A pool of 2,000 Americans at companies with at least 500 employees were chosen for the survey in February, 2023. The survey revealed many contributing factors play into their overall stress.

Health care is a growing financial concern. While 93% of respondents have health insurance covered by their employer, 41% are concerned about health care costs.

This worry is justified: since 2017, the average insurance premium has increased by 20%. Here are some key findings:

• 20% of all employees have unpaid medical bills
• 67% have medical debt over $1,000
• 33% have medical debt over $5,000

Long term, many employees are struggling to save money. About half (47%) have less savings available this year than last, while 36% put off building emergency savings entirely. Of those who depleted their emergency savings last year, 63% have been unable to restore them to their previous level.

The ability to plan for the future is integral in financial wellbeing. Unfortunately, many employees currently struggle to build strong foundations for their future.

• 53% of people with retirement savings are unsure if it will be enough to retire on
• 61% of people fear a potential recession will affect their retirement savings

“American workers are getting hit on all fronts,” Charles Lattimer, Chief Wellness Officer of FinFit, said. “The impact is substantial, often resulting in high levels of anxiety and depression.”

Working Americans are at a crisis point in their personal finances. With inflation at a historic level, the rising costs of everyday expenses make it nearly impossible to build savings and avoid going into debt.

Related: Financial wellness: The No. 1 requested employee benefit

“It’s incumbent on employers to supplement what they are already doing to help their workers persevere through these trying economic times,” Lattimer said. “Most employers are dedicated to offering the right benefits for workers and the market is flush with financial benefits that help workers achieve financial independence.”

Of potential financial wellness offerings, here are the features most desired by employees:

• 53% helps me save more money
• 47% are interested in a low-cost loan available through their workplace
• 31% helps me pay down existing or avoid high-cost debt

Employers are becoming more open to benefits that directly address financial issues like high-cost debt, variable cash flow, and lack of emergency savings, according to the FinFit report.

On average, employers who provide financial wellness benefits see over 2.4x higher employer NPS than those who do not. Employers are becoming more open to benefits that directly address financial issues like high-cost debt, variable cash flow, and lack of emergency savings.

Having emergency funds is a large predictor of financial wellbeing, and elevating employer programs focused on building short-term savings should be a priority. The financial stressors of today’s economy require an active hand from employers in order to offset the struggle employees often experience.