A recent BusinessWeek article “Helping an Employee in a Personal Financial Crisis” had a number of eye-opening estimates about the effect of financial distress on employees and employers. The article sites the Personal Finance Employee Education Foundation estimating the cost of personal financial woes to corporations at $4.5 Billion annually and a Chicago consultant estimating a financially unstable worker can cost a company as much as $480 per month.
As a company focused on improving the financial health of employees, it’s good to see BusinessWeek covering small business examples, as it shows the depth of the problem. While larger companies like IBM, Pepsi and Home Depot have received good press coverage over the past few years for their financial education and literacy programs, smaller companies are also taking notice and implementing programs. I think this section from the BusinessWeek article sums it up the problem well:
As the recession grinds on, more companies find themselves managing workers facing personal financial crisis. And while employers like Humanix treat workers like family, taking care of them makes business sense as well. “I don’t want to make it Pollyanna,” says Humanix’s Nelson. “If an employee has a stressful financial situation at home, they’re not going to be fully engaged in their job.”