If you are trying to grow your business, you have probably discovered that there are a few ways that you can do that. For example, you could increase profits by cutting expenses, increasing sales, or by providing an excellent customer experience that extends your reputation and word-of-mouth referrals.
All of these approaches have one important thing in common: Employees. This is why employee engagement is so important and why many HR professionals and business owners are learning more about it. As the Consumer Finance Protection Bureau reports:
“Engaged employees are defined as those who are not only satisfied with their jobs, their companies, and the conditions of their employment, they are also enthusiastic and committed to the mission of the company where they work and they are willing to expend extra effort to see their employer succeed. In seeking to promote engagement, HR professionals are trying to motivate employees ‘to go the extra mile.’”
One key way to increase employee engagement is to address financial goals. Doing so can impact your business goals for the better.
Financial Stress Impacts the Bottom Line
There are several ways that the financial wellness of employees can affect your company’s bottom line, both directly and indirectly. Some of these ways include:
- Wage garnishments. When employees have too much debt, their debtors are more likely to request wage garnishments. There are substantial guidelines for garnishment procedures that can cost a business to implement. These costs are difficult to recoup because you cannot charge a fee or dismiss an employee for garnishment.
- Risk of theft or embezzlement. The more financially stressed an employee is, the more likely they are to steal.
- Absenteeism or presenteeism. Stress causes illness, both mental and physical, and increases the likelihood of calling out sick. While at work, time spent addressing financial issues is lost productivity and quality of work.
- Health care costs. According to the American Management Association, financially stressed employees are more likely to have heart attacks, ulcers, digestive issues, migraines, anxiety, and depression issues.
- Poor customer experience. Employees who are preoccupied and stressed are less likely to “go the extra mile” for a customer.
- Retirement plans. Retirement plans. If you sponsor your employee’s retirement plan, they are subject to regulatory nondiscrimination tests. The purpose of nondiscrimination testing is to make sure that a 401(k) plan does not benefit highly paid employees more than other employees. Plans that fail nondiscrimination testing usually do so because of low participation and contribution levels among lower-paid employees. Financial education can help all employees to better manage their money and save for retirement.
Many companies have started to recognize the upside to helping their employees deal with financial stress. By offering financial wellness programs, they have discovered that they can build loyalty, increase productivity and engagement, and improve job satisfaction.
You can start now with a no-cost and easy-to-implement option of an onsite Lunch and Learn seminar. Show your employees that you care about their wellbeing, and watch how their engagement increases job performance improves.
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