Money troubles and poor mental health have long gone hand in hand, and while the many pressures of modern living are taking their toll on employees today to raise burnout rates, poor financial wellbeing is greatly to blame.
Already a significant issue before the pandemic, burnout is now becoming increasingly prevalent, with the cost-of-living crisis piling on the pressure. Promoting good financial wellbeing in the workplace is therefore more important than ever to beat employee burnout. So, let’s take a closer look at this pithy issue and how you can help combat burnout with straightforward financial wellbeing strategies.
What is burnout?
The cause of burnout can be summed up in a word – stress. That is, prolonged periods of excessive stress, leading to emotional, physical and mental exhaustion. First coined as a term by psychologist Herbert Freudenberger, in 1974, who defined it as a “state of mental and physical exhaustion caused by one’s professional life”, burnout is far more than a slight case of the blues. The World Health Organization (WHO) now classifies it as an “occupational phenomenon”, and describes it as involving:
- feelings of energy depletion or exhaustion
- increased mental distance from one’s job, or feelings of negativism or cynicism related to one’s job
- reduced professional efficacy
A growing phenomenon
Burnout is now a major issue for employees and employers alike, costing both dear. According to research conducted by Mental Health UK, 1 in 5 people said they were “unable to manage stress and pressure in the workplace”, and a 2023 survey revealed that people taking sick leave because of burnout or work-related sickness is costing the UK economy £28 billion per year. Indeed, burnout can seriously impact productivity not just as a result of absenteeism, but because of presenteeism and overall reduced engagement of employees at work.
Burnout is clearly not a new phenomenon, but has been on HR professionals’ radar for many years. However, its incidence has been increasing significantly since the pandemic, perhaps unsurprisingly with all the stresses and strains that created, including financial woes. In fact, a report by Indeed found that 52% of workers were feeling burned out, which was up 9% from a pre-Covid survey.
Money worries
The sources of stress that can cause burnout may be many and varied, but might include a heavy workload, a lack of control over decision-making, poor work-life balance and concerns over job security. However, among these causes, financial worries loom large.
According to the research conducted by Mental Health UK, 81% of people agreed that money worries could contribute to burnout. This should not be a surprise to anyone who has laid awake at night with financial matters on their mind. Indeed, lack of sleep, in itself, caused by such worries can make it harder to cope and exacerbate burnout, as a study by the University of South Florida found that losing as little as 16 minutes of sleep a night can make the difference between having a good or a bad day at work.
In fact, a recent survey of UK full-time employees found that 23% of respondents admitted to losing sleep as a result of financial anxieties, 32% were struggling to complete day-to-day tasks because they were worried about their financial situation, 56% now consider their personal finances to be their greatest source of stress, and a disturbingly high 70% were worried that their financial situation was going to deteriorate further in the future. Unfortunately, with the current tough economic climate this does not look set to improve imminently, as, according to research this year, 62% of UK adults in full- or part-time work said that the rising cost of living was contributing to their stress.
5 simple strategies to fight financial stress
So, what can you do to help your workers cope better with such financial pressures and beat employee burnout? Well, here are some straightforward strategies you can implement, which can benefit both your employees and your business:
1. Education, education, education
One of the most powerful ways to fight poor financial wellbeing is to provide good financial education programmes and resources for your people. This enables them to become more financially proficient and navigate modern life better. Consequently, it can help them feel more secure and beat employee burnout. Such resources could include:
- Interactive workshops
- A library of learning materials
- Podcasts
- Financial management tools
These need to be easily accessible and could be made available via an online employee financial wellbeing portal.
2. Enable employees to take control
A lack of control is a major source of stress that can contribute towards burnout, so helping your employees take control of their finances may improve their overall wellbeing. This could involve providing resources and guidance to help them budget effectively, and might include supplying access to an online financial wellbeing platform that provides budgeting tools, to help them manage this with ease. In addition, you could also offer access to a debt management service, as this can help those who need it to set up a manageable repayment plan and gain back control of their finances.
3. Get the conversation going
In general, you can help beat employee burnout by making your staff feel more listened to, which can lower stress levels and improve workplace engagement. This is especially important where financial issues are concerned, as only by having open communication on the topic can financial pressures be eased, assistance be offered and wellbeing be improved. This may not be easy, as traditional taboos still mean many are reluctant to have financial conversations, but it is vital to cultivate a work culture that is supportive of monetary issues. You can do this by providing a safe place to talk, being reassuring and offering practical financial assistance.
4. Help employees plan for the future
Helping your employees to financially plan for the future is a great way to beat employee burnout and lift morale. Uncertainty regarding future finances can create significant stress, and recent research found that those who plan for the future are three times more positive about their finances than those who do not. You can achieve this by helping your employees effectively plan for retirement, by offering a good pension plan. You might also help them locate any lost pension pots from previous jobs, to optimise their retirement funds, which can easily be done through a high-quality financial wellbeing platform.
5. Provide individual advice
Lastly, a one-size-fits-all solution is not the answer for financial wellbeing, as employees are all individuals and failing to recognise this could just alienate them and contribute to burnout. It is therefore a good idea to offer bespoke guidance to your employees, by providing free access to a financial adviser. In this way, they can discuss their individual financial requirements and find the answers they need.
Conclusion
By putting in place these simple strategies, you can help empower your employees to navigate the cost-of-living crisis better and strengthen their defences against burnout. With the severe negative impact this issue can have on both your staff and bottom line, it certainly pays to promote better financial wellbeing in the workplace.
About the author:
Chieu Cao is the founder and CEO of Mintago, an FCA-regulated company that provides a complete and inclusive financial wellbeing solution. By equipping its users with financial planning tools, over 1,000 pieces of educational material, access to financial advisers, a Money Helper AI tool and a dashboard that allows full pension management, Mintago helps businesses support their staff during the cost-of-living crisis and supply them with everything they need to navigate their financial lives with confidence. Mintago can also assist businesses in saving thousands in National Insurance contributions, as well as providing their staff with direct savings.