Ongoing cost-of-living pressures have driven sustained increases in the price of goods and services, particularly food and energy. Higher prices and inflation continue to make it difficult for many people to afford basic necessities for themselves and their families. Alongside these financial pressures, there has been a noticeable impact on mental wellbeing, with many people experiencing increased stress and anxiety.
Although the government has introduced a range of support measures, analysis from the Institute for Government indicates that household incomes have struggled to keep pace with living costs and are not expected to return to 2021 levels until around 2027.
These pressures are also being felt across workplaces. During CIPD roundtable discussions, it was noted that “the NHS simply can’t accommodate the volume of people seeking help from mental health services”. This has been reflected in businesses increasingly seeing employees turn to their employers for support with financial wellbeing.
The impact of financial pressures on employees
According to a survey by Mental Health UK, a fifth of UK employees are experiencing burnout, and long-term sick leave has hit a record high. The study also found that 38% had experienced stress due to “taking on additional work because of the cost-of-living crisis”.
Other impacts reported have included a loss in productivity, low morale and more workers leaving positions and moving around the job market.
The CIPD reports that fewer employees are finding it easy to pay their bills, and the percentage of workers saying that their employer was doing enough to support their financial wellbeing has dipped from 36% to 31%.
According to a spokesperson at Mental Health UK, “life outside work has become increasingly difficult due to the cost-of-living crisis and pressures on public services, while global challenges such as climate change and artificial intelligence fuel stress, anxiety and feelings of hopelessness.”
What is an employee assistance programme (EAP)?
An employee assistance programme (EAP) is a workplace benefit designed to support employees facing personal or work-related challenges that may impact their general wellbeing, performance, or overall effectiveness at work. EAPs typically offer confidential, short-term counselling and supportive services that help employees navigate a variety of issues – including financial struggles. According to Personal Today, EAPs have seen a surge in demand due to cost-of-living crisis.
Having this provision in place can help to boost staff wellbeing, morale and reduce sickness absence. As well as having an EAP in place, it’s important to continually raise awareness of how staff can access it and what issues it can help with. The EAPA UK Chair states that “EAPs aren’t — or shouldn’t be — just a reactive offering. Any preventative health programme needs to start with raising awareness of the range of EAP provision, and its value in helping to address root issues early, the kinds of issues that snowball from feelings of stress and loss of control into both physical and mental health problems.”
How can EAPs support employees during the financial squeeze?
EAPs can support employees by:
- Providing 24/7 access to professional help and support – This allows staff to reach out when they need it most, and access vital support such as counselling services, or receive referrals onto other supportive interventions. According to CIPD, “research has proven time and time again that workplace counselling can halve sickness absence in organisations, and employees that have access to mental health services return to work sooner, are more resilient, more productive, and less likely to become long-term sick”.
- Providing a confidential service – This is key to financial struggles as many may feel uncomfortable discussing money issues with friends, family or colleagues. According to Mental Health Foundation, stigma is stopping people from opening up, with one third of UK adults with anxiety saying they feel ashamed to talk about money worries.
- Providing valuable signposting links and resources – This could include information about debt charities, helplines or in some cases to legal support. They can also provide self-help materials to help staff grow awareness and understanding around managing common challenges, such as managing money.
- Providing a cornerstone to your organisation’s employee wellbeing strategy – An EAP can complement other health and wellbeing interventions you may have in place, such as occupational health and access to digital health apps.
Summary
From providing instant access to vital support, to offering resources on financial wellbeing, EAPs play a pivotal role in employee wellbeing against a backdrop of high living costs. With sickness levels at a record high and many employees experiencing stress and anxiety, employers can’t afford to ignore the role they have to support staff with effective interventions like EAPs. This action supports the wellbeing of your staff, and ultimately the health of your organisation.
Further support
CIPD– Health and wellbeing at work report.
EAP Association – Importance of EAPs in reducing sickness absence.
PayPlan– Provides a free confidential helpline for debt advice on 0800 280 2816 (open Mon-Fri 8am–8pm Sat 9am–3pm).
National Debtline– Provides a free debt advice line on 0808 808 4000 or a webchat service (open Mon-Fri 9am – 8pm and Sat 9:30am – 1pm).
Money Helper– Provides free financial guidance.
Mind– Provides mental health support.
Ref: WPW0291 This information was published March 2024.
