How to keep your employees happy

Over the last few years we’ve seen unprecedented levels of financial stress for many people throughout the UK.

People are feeling the pressure.

Our economy is at a growing risk of recession. At the end of 2023, industry figures showed some of the sharpest falls in private sector activity outside the pandemic.

And although inflation rates are showing signs of recovery, there are still plenty of people experiencing significant stress due to the UK cost of living - impacting employee health and wellbeing and leading to higher levels of mental stress and anxiety.

So what does this mean for organisations, and HR teams? 

A greater focus on what you can do to improve the financial wellbeing of your people.

Let’s explore why financial wellbeing is a critical component of employee wellbeing, and discover how to keep your employees happy.

‍

What are we talking about when we say employee wellbeing?

‍

Global analytics and advisory firm Gallup say that employee wellbeing is made up of five key elements - all of which are equally important if you’re serious about improving the overall wellbeing of your people. 

• Career wellbeing: You like what you do every day.
• Social wellbeing: You have meaningful friendships in your life.
• Financial wellbeing: You manage your money well.
• Physical wellbeing: You have energy to get things done.
• Community wellbeing: You like where you live.

‍

Mental wellbeing

According to Gallup, when a workplace fosters high engagement, there is a reduced chance of experiencing new episodes of depression and anxiety.‍

MFHA England also says that poor mental health accounts for more than half of all work-related illnesses. In 2023, around 51% of long-term sick leave was caused by stress, depression, or anxiety. With many employees feeling more significant pressure at work than ever before. 

If you’re serious about workplace wellbeing, you need to look at ways to help reduce mental health factors, including stress and anxiety, by developing a high engagement, positive workplace culture. 

Physical wellbeing

When we talk about physical wellbeing, it’s about the bodily wellness of your staff, including things like their energy levels, exercise routine, physical activity and diet. 

‍All of which are affected by their work environment and workload. 

You can influence physical wellbeing by introducing a healthy eating environment, like offering healthy catered meals or healthy snacks such as fruit baskets. 

Many organisations also offer wellness programs through discounted gym memberships, active work activities, in-house yoga classes and more. 

‍

Social wellness

Employee social wellness refers to the connection employees have with their peers and the leadership team. And the sense of belonging they have with the organisation. 

‍It can be a key indicator in how satisfied and productive an employee can be in the workplace. 

It’s also tied with employee engagement, which is critical for improving your employee retention rate. We all know that if employees don’t feel comfortable at work, they’re more likely to leave. 

‍A big part of feeling comfortable is having solid relationships. 

Building a culture that promotes relationships can help your people to feel more comfortable, which can increase their social wellness.

Physical location is also another important consideration in social wellness. ONS data shows around 44% of UK workers currently work remotely in some form, which can make it more challenging to develop close relationships. 

‍Creating more virtual opportunities for connection will be essential for the future of work. 

‍

Financial wellbeing

What is financial wellbeing?

It’s about helping your staff to feel financially secure, by providing them with the tools and resources to get them on track for a healthy financial future. 

According to Buck, around half of UK employers are responding to the cost of living crisis by planning to increase their investment in financial wellbeing, including introducing new technology platforms. 

Around 25% also indicated they’d look to increase pensions and workplace savings investment. 

While it’s not practical for organisations to offer pay rises to keep pace with inflation, financial wellbeing programs represent an alternative way to invest in the financial wellbeing of your people. 

‍

What is the impact of employee wellbeing in the workplace? 

Fostering employee wellbeing is good for your people - and it’s good for your business. 

When you promote wellbeing in the workplace it can help to prevent stress and create a positive workplace culture and environment where your people can thrive. 

Happy employees = productive employees

A recent Forbes study showed that happy employees are up to 20% more productive in the workplace than unhappy employees. And that employee happiness is a direct result of employee wellness and health. 

Their research found that highly engaged teams were 21% more profitable for a company, and predicted that in the US, companies could end up losing around $550 billion per year because of disengaged employees.

Greater employee retention

It’s been proven time and time again that employee wellbeing is essential for employee retention. 

Research from Gallup shows employee wellbeing directly impacts retention. Where employees thrive, they’re around 30% less likely to be looking for another job. 

When you feel a sense of purpose and belonging, you feel more valued and are likely to be more loyal. You’re also likely to be more engaged and more productive - making it a win-win for employees and businesses. 

Improved engagement

Wellness programs lead to almost 90% of employees reporting higher job satisfaction and engagement levels. 

By investing in your employee’s wellbeing, you’re helping to create more engagement for your employees, which can lead to them bringing more commitment to their work, more enthusiasm and more investment in your business’s success. All of which can lead to increased customer satisfaction, productivity levels and retention. 

Less absenteeism

There’s plenty of research that shows the correlation between employee wellbeing and absentee levels. 

‍Forbes research shows that happier employees, who are engaged and feel a sense of purpose and belonging, experience a 40% reduction in absenteeism levels compared to disengaged employees.

‍Gallup research has shown that employee engagement can lead to an 81% drop in employee absenteeism, and other studies show that wellness programs contribute to a reduction in absenteeism of around 25%. 

‍Just remember that absentee levels alone shouldn’t be an indicator for measuring your employee’s wellbeing. 

According to CIPD, there’s been an increase in unhealthy working practices such as ‘presenteeism’, which relates to people working when unwell. 

The survey showed 81% of companies reported presenteeism from remote workers and 65% from those working in the office. Almost 70% also observed some form of ‘leaveism’, like using annual leave when unwell.

It’s important to look beyond absence statistics to uncover the underlying factors affecting your team’s wellbeing. 

Why employee Financial wellbeing is more important now

Unsurprisingly, money is currently the biggest stressor for people working in the UK today, with around 25% of adults stressed about money every single day. 

Poor financial wellbeing is contributing to stress and mental health problems, due to a lack of savings, escalating debt and rising expenses. 

We’re living in a difficult economic environment, and financial wellbeing is becoming more important for day-to-day living, not just retirement planning. 

If your people are stressed about their finances, it leaks into their mental, physical and social wellbeing - affecting their overall workplace wellbeing levels. 

‍CIPD research shows that the proportion of employees saying their pay was enough to support an acceptable standard of living (without going into debt) fell from 76% to 60% in the last year. There was also a drop from 36% to 31% of workers who felt their employer was doing enough to support their financial wellbeing. 

‍But, financial wellbeing is still the poor relation of employee wellbeing and is the least promoted area of wellbeing. 

So, for those businesses willing to embrace it, financial wellbeing can help differentiate you from your competitors, to attract the best people for your organisation, and keep your top talent. 

‍Research shows that 4.2 million workers' days are lost in absences related to a lack of financial wellbeing each year. And around 70% of UK employers believe staff performance is negatively affected when employees face financial pressure.

It makes sense to invest time and resources into financial wellbeing programmes to help your people become happier and healthier employees - and generate more successful business outcomes.  

How to increase employee financial  wellbeing

There are plenty of simple ways to help improve your employee’s financial wellbeing, and focusing on employee financial health and wellbeing should be a core element of your HR strategy. 

‍Listen to your employees challenges

‍Don’t make assumptions that could end up alienating your employees. 

When designing financial wellbeing programmes, listen to your people. Make sure you understand their challenges and what tools, resources, guidance and advice will be beneficial to their needs. 

There’s no point designing an entire programme focusing on retirement planning when 80% of your staff are under 40 and struggling to make ends meet day-to-day.

Focus on the financial challenges that are relevant to them to make sure they’re useful, practical and targeted.

Fair pay and benefit policies 

At HR Data Hub, we’re all about transparent pay. 

Offering competitive pay and total rewards packages not only makes you more attractive for new staff, but it also supports your people during the cost of living crisis. Which can lead  to higher levels of loyalty, engagement and productivity.

Retirement planning (pension)

As an employer, you need to provide a workplace pension scheme for eligible staff as soon as they start working for you. 

But many employees don’t provide a lot of information about the scheme, or the steps they can take to help get their finances retirement-ready - whether they’re close to retirement age or have plenty of working years left. 

Being proactive by creating financial education programmes around retirement planning that are appropriately targeted for different stages in your employee’s working life can help them to make the right financial choices in the lead up to retirement and balance short-term financial pressures. 

Employee financial support & education

Providing financial support and education to your employees through targeted financial wellbeing programmes helps support your staff’s financial goals. 

You can start small, by introducing topics like budgeting or financial goals. Setting financial objectives and offering tools to support your people can help to shift spending habits and get them on track for a more successful financial future. 

‍‍

Manager training

Train your managers about financial wellbeing.

While no one expects management to be experts on the ins and outs of how to achieve financial wellbeing (there are plenty of off the shelf products and technology products you can use to access the right training), your managers need to understand the benefits of financial wellbeing and why it’s important to get your people on board. 

So they can encourage and support their teams to take advantage of the training opportunities available, to help improve their wellbeing for the benefit of your organisation. 

Pay Tracker Live: the best way to make sure you’re paying your employees fairly

You can’t pay your employees fairly if you don’t know what fair and competitive pay looks like. 

Pay Tracker Live is the most comprehensive pay information database in the UK. 

Our powerful salary benchmarking tool is designed for HR professionals, offering real-time insights for any job, in any location across the UK. 

With just a few clicks, your HR teams will get access to localised and reliable job market data to help make accurate and data-driven pay decisions. 

Pay fairly - relieve financial stress

When you pay your people fairly, you’re helping relieve their financial stress. 

Which improves their mental and financial health, strengthens their wellbeing at work and helps to keep them more engaged. 

By offering fair and competitive pay and benefits, your people will not only feel valued, but supported, leading to higher productivity levels and retention rates.

If you’re interested in finding out more about how Pay Tracker Live can help your business, get in touch with us today to find out more.

‍