The cost of living crisis has become an unavoidable aspect of life for most people and is unsurprisingly a growing and recurring topic of conversation among businesses in all sectors.
Employers are recognising that this is a universal challenge affecting businesses and employees across the board. With financial wellbeing becoming increasingly recognised as an important part of a holistic wellbeing strategy, what can HR do to support colleagues through the cost of living crisis?
This was the question posed at last week’s Make a Difference webinar sponsored by YuLife – an insurance company focused on putting health and wellbeing first.
The session was chaired by Kate Whitelock, Head of Wellbeing for YuLife, and included thought-provoking discussion with panellists Hannah Pearsall, Head of Wellbeing at Hays and Victoria Sloan, Head of Wellbeing for Anglian Water.
They were joined by Lydia Hamilton-Rimmer, Workpace Health Policy Lead at CBI, who set the scene with some insights on the current financial climate.
She shared that the recent and current turbulent political and economic climate following the fallout from Covid, war in Ukraine and the global fossil fuel supplies conversation, have stoked inflation and driven a global synchronised tightening in monetary policy.
The recent mini budget has also caused disruption in the market, causing the pound to lower and mortgage rates to increase.
All of these have had an impact on the financial wellbeing of both businesses and individuals.
What does all of this mean for health and for our people?
With inactivity rates being at a 20 year high, 17% of the workforce are actually out of the workforce due to sickness, caring responsibilities, cost of childcare and other factors.
Lydia reinforced that it’s clear that businesses have a role to play in health and wellbeing. Health is increasingly being seen as a precondition for growth, as without healthy people the nation’s workforce will depreciate.
With this in mind, the webinar panel discussed how businesses can support the financial wellbeing of employees and the role HR can play in supporting colleagues through the cost of living crisis.
Here are some of the key themes that emerged from the discussion.
1. Tackling the stigma/Opening the conversation
Surprisingly, it seems even more taboo to talk about money than it does mental health. Since financial hardship can be linked to performance issues, this can make it doubly hard to talk about.
Breaking down the stigma associated with discussing financial health and opening up the conversation is an important first step in helping to support colleagues.
The language we use when discussing these issues was another theme that emerged. In the media the language used is often sensationalist, which can come across as quite frightening; being conscious of using relatable and non sensationalist language is important when opening up lines of communication around this topic.
2. A holistic approach is needed
It’s clear that financial wellbeing is inextricably linked with other areas of wellbeing, particularly mental health. For example, 1 in 4 people with debt also face mental health challenges. Since health inequalities tend to entrench themselves further when challenges such as the cost of living crisis occur, it’s important to address financial wellbeing as part of a wider wellbeing strategy rather than taking an isolated approach.
Victoria shared that one of the things they’ve been focusing on at Anglian Water is the relationship between poor financial wellbeing and emotional stress. This led them to provide sessions that help people learn more about stress management.
3. Personalised provision
It’s important to really understand who your people are and what their specific needs are, rather than just ‘plugging the gaps with provision’. A curated approach can help mitigate risks that arise.
One question that was asked in the chat was whether companies should be making ‘one off payments’. Lydia’s response was that there is no set standard for this and it varies across sector. She suggested that looking at your own specific workforce demographics could be helpful in determining what support would work best. For example, whereas a one off payment might help younger employees out in the immediate term, it may be less helpful for older aged employees who might benefit more from pension related support.
4. Education, not advice
A key agreement among the panel was that it’s important that provision is given as financial education, not financial advice. Empowering and equipping employees to take control of their own financial health by providing them with education and signposting to available benefits is a good approach that allows them to make long-term positive choices for their own wellbeing.
Storytelling can be a powerful tool in helping colleagues to engage. Sharing real life stories and case studies can elicit a strong response. This is especially useful if the storyteller has personally engaged with benefits offered by the company as it raises more awareness.
The panel discussed how these stories are probably more powerful coming from a ‘grassroots level’ as more highly paid employees sharing stories of financial hardship may come across as ‘inauthentic’.
6. Cost doesn’t have to be a barrier
There doesn’t necessarily have to be a financial barrier to providing financial wellbeing support to colleagues. There are plenty of ways that smaller businesses can offer support without making large investments, such as:
- Opening conversation – if nothing else make sure lines of communication are open. Sometimes an empathetic and compassionate conversation is all that’s needed.
- Creating a sense of community and support
- Using charities – charities such as StepChange offer a wealth of free support and resources – there is access to low or no cost solutions.
Key takeaways summary
Financial wellbeing is a vital aspect that needs to be considered within a wider holistic wellbeing approach. As the cost of living crisis is affecting everyone, the panel all agreed that something is better than nothing, especially as winter approaches and will likely emphasise the challenges people are facing.
Whatever your organisation is able to offer is helpful, even if it’s simply opening up the conversation and highlighting available support.
As Lydia Hamilton-Rimmer put it: ‘Any business, regardless of size, regardless of revenue, can really get on this journey and support their people for a happier, healthier future.’
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