How to recognize financial stress at employees?
27 Feb 2025
5 min
Financial problems are a burden people often carry in silence. Shame and discomfort play a significant role, preventing employees from openly discussing their financial situation at work. However, financial stress has a huge impact on work performance, mental health, and even workplace atmosphere.
Productivity declines, absenteeism increases, and in some cases, employees seek higher-paying jobs. This has negative consequences for both the employee and the organization. As the cost of living rises due to inflation, the housing crisis, and energy costs, more and more employees are experiencing financial stress—even those with above-average incomes. That’s why it’s crucial to recognize signs of financial concerns and create a work environment where financial problems can be openly discussed.
Recognizing financial stress at employees
According to research by Nibud, the three most common signs of financial problems are:
Wage garnishments processed through HR.
Frequent requests for salary advances.
Increased absenteeism. Stress has a direct impact on physical and mental health.
Beyond these, other indicators of financial stress may include:
Working overtime or requesting extra hours: A pattern of working additional hours without a clear reason may signal financial worries.
Reduced concentration: Making more mistakes, being forgetful, or struggling to stay focused.
Less social interaction: Avoiding lunch with colleagues, skipping after-work gatherings, or not participating in gift exchanges.
Increased stress and irritability: Becoming more easily frustrated or reacting emotionally to minor issues.
Declining productivity: Slower work pace, missing deadlines, or disengagement from tasks.
Conversations about financial struggles: Comments like, "I really need to cut back" or "This month is tough again," sometimes disguised as jokes.
Changes in personal appearance: Wearing worn-out clothes or shoes may be subtle signs of financial difficulties.
Anxiety over delayed salary payments.
Frequent personal calls: Multiple phone calls with institutions or potential employers could indicate financial stress.
Poorer health choices: Avoiding doctor or dentist visits due to financial concerns, as well as opting for cheaper, less healthy food choices like fast food or easy-to-prepare meals.
What can employers do?
1. Foster an open culture
Create a workplace where financial concerns can be discussed. This can be achieved by sharing stories via internal communication channels, such as the intranet, where employees talk about their experiences with financial stress. You can also introduce available financial support during onboarding.
2. Provide education and support
Offer workshops and training on financial well-being. Vary the topics and acknowledge that discussing money struggles carries a stigma. Involving managers in webinars or training sessions can also be beneficial.
3. Be aware and show empathy
Recognize the signs and offer a listening ear without judgment. Financial difficulties can arise for various reasons, such as divorce, illness, a partner’s job loss, or a lack of financial literacy. Many employees blame themselves for their situation, making an empathetic approach essential.
4. Be well-prepared
Know which organizations or agencies can provide support for employees experiencing financial stress. Offering timely assistance or referring someone to the right resources ensures that employees receive the help they need before their problems escalate.
Want to learn more?
Would you like to make financial struggles more discussable within your organization? Contact us for advice.