There is a significant relationship between the level of financial stress workers experience and their on-the-job performance, according to the findings of a study of employee data published by human resources consultancy Willis Towers Watson on December 27, 2018.

Researchers cited the results of the “2017/2018 Willis Towers Watson Global Benefits Attitude Survey,” which showed a clear relationship between employees’ financial worries and their work performance, engagement levels, and record of absences. Specifically, the survey revealed that employees who were struggling financially lost 41% more work time to absence than peers without financial worries, had lower engagement levels than their peers without financial worries (51% vs. 29%), and were less productive than their peers without financial worries (32% vs. 5%).

To examine the performance gap between employees who are and are not financially stressed in greater detail, the study used a large employer’s records of work quantity and quality for a relatively homogeneous group of 17,587 employees serving in consumer-facing roles. The financial stress level of each employee was categorized as high, medium, or low based on a range of indicators drawn from the administrative records. These indicators include whether the employee was contributing to a 401(k) retirement plan, had taken a loan or a hardship withdrawal from 401(k) plan savings, was subject to active wage garnishment, and had a recent qualified domestic relations order.

The results of this analysis showed that 24% of the employees had high stress levels, 33% were experiencing medium stress levels, and 43% had low stress levels. Additional analysis indicated that middle-aged employees (aged 35-54) were far more likely to be in the high and medium financial stress groups than their younger (aged 18-34) and older (aged 55+) counterparts.

The findings also showed that having more family responsibilities was associated with higher stress levels. For example, researchers noted, 69% of the high-stress group, but just 42% of the low-stress group, had children; and more than a quarter of the high-stress group, but only 10% of the low-stress group, were single household heads.

The relationship between financial stress and time lost to absence was measured by employees’ use of sick days, unpaid leave, and non-pregnancy-related disability leave. The results indicated that for every one absence day taken by the employees with low stress levels, the employees with high stress levels took 1.75 absence days, and the employees with medium stress levels took 1.37 absence days.

The full study sample was then split into two subpopulations according to their job characteristics: field technicians or phone agents. The analysis found a strong association between financial stress and job performance among the field technicians, as the field technicians with high stress levels had significantly worse work performance than their peers with low financial stress. For the phone agents, the pattern of differences was found to be similar, but less pronounced. Researchers pointed out that this variation in the patterns of the phone agents and the field technicians suggests that the impact of financial stress on productivity may differ across occupations.

The study concluded, however, that “the impaired job performance observed in the employees with high financial stress are concerning because of the potential impact on customer satisfaction and customer retention, both key determinants in profitability.”


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