#65: Financial Anxiety Discussion

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Hello everyone, and welcome back to the Proteus Leader Show. My guest today is Asad Lazarus, Chief Client and Development Officer at Purchasing Power, a company that offers a purchasing program for an organization's employees to use their paycheck to buy products in a planned, secure way. Purchasing Power also offers tips and and resources for employees to navigate their finances and improve their financial well-being. Asad has led across sales, operations, strategy, and marketing functions in Fortune 500 and Fortune 1,000 organizations for more than 20 years. So welcome to the show, Asad.

Hey, thank you so much, Erika. Great to be here.

Yes, I'm really glad to have you here. We, we all know that a lot of people are experiencing financial difficulties coming out of the pandemic. And, and Purchasing Power has lots of research, it looks like, showing that this is true across all ages, across all levels of income. And so I thought our listeners would find it really valuable to hear more about the research you've done and what employers can do to address the problem. So I'm thrilled that you're here to talk to me about this. So you ready to dig in?

Yeah, sure, let's go.

So can you tell us some of what you found out about people's current financial stress in the workplace and how this is affecting their company's culture and employee productivity?

Sure, Erika. So, you know, as a financial wellness company, we've done quite a bit of research over the years, including a recent Harris poll. And what our research reveals is that, you know, really virtually all working Americans, 97% of full-time employees, are feeling financial anxiety. It's also likely that their financial struggles and stress have worsened, you know, over the past couple of years. In fact, 40% of working Americans across all income levels and generations say their financial situation is much or somewhat worse than it was pre-pandemic. You know, while we're in a very hot job market, we've seen unprecedented levels of inflation that have far outpaced increases in wages. And so Americans are being forced to make tough decisions at home and are increasingly relying on debt. This is having a significant impact on the workforce, the culture, and employee productivity. And so, you know, as this stress negatively impacts, you know, their physical health, their job satisfaction, and even how they show up every day, including their ability to focus at work and perform at work, You know, it's a real problem. You know, 39% of employees spend 3 to 6 hours or more a week worrying about or dealing with personal finances. So yes, this definitely affects work culture and productivity.

Yeah. And so you said it's almost everybody's— 97%, you referenced, are feeling some financial stress, and that 40% say it's somewhat or a lot worse than it was before the pandemic. How much do you— I mean, this is kind of an unrelated question in some ways, but How much of that, of that do you think has to do with what they're calling the Great Resignation, the Great Realignment, where people are also in new jobs or looking for jobs and there's that insecurity to add to the whole mix?

Yeah, I think anxiety stretches across many different factors, but it all links back to, you know, people are working to make an income in order to, you know, get by day to day. And yes, folks are searching for other options for whatever reason they may choose to resign or reflect or, you know, I've heard great word reflection, many different terms. You know, at the end of the day, there is the current economic factors that really are creeping in. Again, as I mentioned, inflation, interest rates and the like. And those are realities. And, you know, so I think altogether just anxiety and stress are increasing for folks. And You know, it impacts their health, it impacts their mental situation, and also financial. It all plays together.

Yeah, yeah, yeah. So what are some of the— do you have any more kind of information or insight about how this is affecting company culture?

So I think that company culture is important, right? You mentioned the Great Resignation, and folks are resigning at almost a record pace. And I think culture now is something that employers have to focus on to attract and retain talent. But again, with folks leaving or having financial stress, it significantly impacts how they show up. I think that what's important for employers more than anything for them to do is to not avoid the issue. It is getting worse for employers, employers out there. to retain folks, and they cannot ignore the fact that anxiety and stress exists in the workplace. You know, 72% of full-time employees believe that employers have responsibility to help employees improve their financial well-being.

Right, right, right.

You know, when you consider that, you know, 4 in 5 employees say their employee benefits impact their decision to stay at their current job, Addressing financial health and wellness is a significant part of the employee experience and the benefits, right? That impacts the culture as well. And so, and it extends beyond just providing compensation and a 401. It's really relevant benefits do matter, especially at this time when competition for talent is so fierce. So—

Yeah, that makes a lot of sense. Let's, I wanna go back to something you said just a minute ago, 'cause I wanna ask you kind of what doesn't help, What makes the issue worse? And you mentioned one thing, which is employers just kind of ignoring it. So what else? What should employers not do in response to this financial stress that employees are having?

Well, I think too, if you're deploying benefits, I think to not take a paintbrush approach, right? You know, there are different segments of employees out there and, you know—

Oh, when you say paintbrush approach, you mean kind of one size fits all?

That's exactly right. That's exactly right.

Yeah.

Because, you know, sure, there's a lot of emphasis out there on things like 401 or things to help people save, and that definitely focuses on a component of their workforce that are probably prepared to do that or in a position to do that. But, you know, when you think about such a large segment of the population that are struggling day to day, a paintbrush approach isn't appropriate. I think a more A thoughtful approach. First, you've got to understand your workforce.

Yeah.

Segment them as best you can and understand what matters to really help them to be, you know, more or less stressed, you know, at work. It's, again, physical and mental health are important, but again, financial health and well-being are becoming just as critical for workers. In fact, all these health factors are interrelated and to make an impact.

Absolutely.

It requires employers to focus on all 3.

Yeah, I completely agree with you that financial health and physical health and mental health, they're all hooked together. So the 2 things that it sounds like you're saying are the least helpful are ignoring it, which makes sense. It's just like, no, everything's fine. We don't have to think about this. And the other one that doesn't make sense is just to assume that you can just have a unilateral kind of, here's our benefits package. It's going to work for everybody. And it won't, is what you're saying.

That's exactly right. I think you've really got to have a strategy around it. It takes a little time and a little effort, and it is a challenge for employers. But to make an impact, you've really got to give that some thought and some segmentation around how to impact your employee base.

Well, let's go there. I mean, we always promise our listeners some practical takeaways, right? So what can employers do to better support their employees in this difficult situation? What's the opposite of taking the paintbrush approach? What do you recommend that employers do?

Yeah, so again, the challenge and opportunity, right, is to make sure that they offer benefits that really support the financial needs of the struggling segment of their employees, especially those lower-wage employees that have difficulty with making ends meet.

Yeah.

Most financial health benefits today are focused on long-term financial needs, as I mentioned before, savings and wealth. You know, you have 401, asset protection, you know, there is insurance. But, you know, the struggling segment, you know, that are really struggling to get by week to week, addressing their need is really around short-term financial support, especially debt and spending. That's where employers can really support employees during this difficult time. The great news is that employers are having an increasing set of options from solutions that address money management topics to resources that help employees cope with anxiety and stress relative to financial literacy and education.

Yes.

Student loan debt repayment programs, early wage access solutions, to unique benefits like, again, as you mentioned, purchasing power, where employees with no access to cash or affordable credit can avoid predatory lending for the goods and services they need. So Many of these solutions don't have any costs to the employer. So I think the takeaway is to focus on benefits that truly address the immediate short-term financial needs of employees that need it most. And that requires a real understanding of the workforce and their needs.

That's very helpful. And also, I mean, we could have a whole other conversation about the fact that even as employees are experiencing a lot of financial stress, a lot of companies are doing very well and are experiencing high levels of profit. So to really Think about if you want to retain your best employees, can you spend some money as an organization to offer them, for instance, better health benefits, or think about, you know, even better compensation for people, especially at the entry levels of your organization?

Yeah, that's right. I mean, I think corporations have to look at this like an investment. You know, the cost of attracting and retaining talent— I'm not saying something that folks don't know— it's expensive. And it, you know, it's critical. And this is part of that equation. Again, as I mentioned, though, there are some solutions out there that don't require a significant amount of investment, but employees need to know that you care.

Yes.

And that's part of it. They need to know that you're trying to really impact their lives. Compensation is one thing. And let's face it, there are limitations on how much employers can do around that. But giving them the tools, giving them the resources, it takes a little time and invest— and effort upfront. And in a lot of cases, there's so many solutions out there that don't require a significant amount of ongoing investment.

Yeah.

Doing work upfront, the segmentation, understanding your employee base, and putting solutions out there that meet the employees where they are. Many of them can't— are struggling day to day. That's important.

This is great. I, I, I mean, I know this is such a major problem for individuals and for companies right now, so I really appreciate your insights. This is great. Thank you.

Thank you so much.

Oh, sure. And listeners, to find out more about Purchasing Power and the support they offer, some of which Asad has just been telling us about, you can go to purchasingpower.com. And if you'd like to find out about how Proteus supports leaders to become more change-capable to support their employees in these wild times, you're welcome to go to ProteusLeader.com, click on Topics, and choose Change from the Inside Out. So thank you again, Asad. I really appreciate you taking the time to talk to us.

Thank you so much. Very, very important topic. I appreciate your time.

Thank you for listening, everybody. And until next time, here's to creating the life you truly want.

We hope you're feeling better equipped to create the career The business and the life you want. For more insights and tools for leadership and management, join us at proudestleader.com. Have an excellent day, and thanks for listening.