The Connection Between Financial Wellbeing and Employee Retention
Why Employee Retention Matters
Employee retention is a critical success factor for businesses across industries. Yet, high turnover rates continue to challenge organisations, leading to hidden costs, disrupted teams, and weakened company culture.
The cost of staff turnover goes beyond the obvious expenses associated with recruitment and training. It also impacts organisational morale and productivity. Employees who leave can take valuable institutional knowledge, and constant change makes it harder to build strong, cohesive teams.
Investing in strategies that boost employee retention and prioritise staff wellbeing can strengthen your workforce and sustain a positive company culture.
The Role of Financial Wellbeing
The financial stability of employees has emerged as a key driver of retention. Employees who feel financially secure are more engaged, productive, and likely to stay with their current employer. Despite this, 1 in 4 employees in the UK would be unable to pay an unexpected bill of just £100.
Programs that prioritise employees' financial wellbeing signal that a company values its workforce beyond their job performance. A supportive environment, combined with tangible tools to alleviate financial stress, is becoming an essential part of a comprehensive retention strategy.
One such tool that is reshaping retention rates is Earned Wage Access.
The Case for Earned Wage Access
Earned Wage Access allows employees to access a portion of their earned wages before payday, helping them manage cash flow and avoid financial stress. The positive impact on staff retention is striking:
Companies that introduced Level’s Earned Wage Access has reported up to a 50% reduction in staff turnover.
Financially empowered employees are more loyal, engaged, and thoughtful in their contributions.
It reduces reliance on employees using high-interest loans or credit to bridge financial gaps, improving overall wellbeing.
Beyond Cost Savings
For employers, the benefits of improving financial wellbeing go beyond saving on recruitment and training costs. By focusing on initiatives that value employees’ holistic needs, organisations can expect to see:
Enhanced Productivity: Employees experiencing less financial stress can focus better on work.
Reduced Absenteeism: Financially stable individuals are less likely to take unscheduled absences due to stress or crises, reducing absenteeism by up to 13%.
Improved Employer Brand: A focus on wellbeing creates a more attractive image for prospective hires, especially in competitive labour markets.
Financial wellbeing policies establish a workplace culture where people feel valued, appreciated, and motivated to stay.
Employers – It’s Time to Take Action
With retention on the line, it’s time to revisit your employee support strategies. By adopting tools like Earned Wage Access, you could significantly enhance employee satisfaction while protecting your investment in your workforce.
Employees thrive when they feel valued—and there’s no better way to showcase this than by addressing a universal challenge like financial security.