A combination of workers taking days off or being distracted due to financial stress is costing the manufacturing sector £85m in lost output every year.
32% of employees would be interested in financial education from their employer, but only 1 in 10 (11%) manufacturing businesses offer it.
Workers in the manufacturing sector are taking off more than 170,000 days each year due to stress over their finances, according to research by pension and investment company Aegon.
These days off, combined with time lost due to employees with money worries not concentrating while at work, are costing manufacturing businesses £85m in lost output every year.
Despite this, the findings show workers in the manufacturing sector experience an above average sense of financial wellbeing compared with other industries. The research was based on a variety of factors, including employees’ capacity to absorb financial shocks and meet financial goals.
Impact of money worries on productivity by industry
However, poor financial wellbeing is still causing a drop in the quality of work from workers across the manufacturing industry, and some have had to leave the industry altogether:
- 66% said they feel that the quality of their work is not as good as it was before they had personal finance worries.
- 38% sometimes struggle with tasks that are otherwise routine.
- 1 in 10 (11%) have had to change jobs entirely.
- To add to this, 30% said poor productivity due to financial stress has held their career back from progressing as quickly as they would have liked.
Pressures such as rent, bills, the cost of living and feeling under prepared for a financial emergency weigh heaviest on the minds of workers across the manufacturing sector and are the main drivers for employees feeling disengaged with their employer. While workers in manufacturing sector cite insufficient pay rises (54%) not keeping pace with a rising cost of living (50%) as the greatest barriers to securing their financial future and thus improving productivity.
The report suggests manufacturing employers could be doing more to improve employees’ financial wellbeing and reap the benefits of improved productivity; only 1 in 10 (11%) manufacturing employers offer financial education to employees, compared to 35% of finance and accounting businesses.
Kate Smith, Head of Pensions at Aegon, said: “We’ve uncovered significant evidence that poor employee financial wellbeing is affecting the productivity of workers across the UK.
“While businesses have traditionally focused on physical and mental wellbeing, the financial side is clearly having a detrimental impact. Our research suggests businesses who address this issue are likely to see tangible improvements to their bottom line.”
The findings follow research published by Aegon and the Centre for Economics and Business Research which found UK employees take over four million days off work each year because of financial worries. This costs the British economy £1.6 billion a year in lost productivity.
The findings come as part of a wider campaign launched by Aegon which aims to tackle financial wellbeing in the workplace. To do this, Aegon is calling for:
- An increase in awareness among employers of the Government’s £500 allowance for pensions advice for each employee
- A shift in mindset so that financial wellbeing is viewed of equal importance as traditional physical and mental wellbeing
- Greater support for employers to offer financial education for employees and better communicate the benefits they already provide
- Effective tools for employees to plan their financial future with confidence driving positive financial wellbeing for today
Annual cost of ‘money worries’ across business sectors
The research was based on a representative survey of 2,000 UK employees across a range of sectors, company sizes and job roles, carried out by YouGov.