A recent survey found that 78% of U.S. employers say their workers are financially stressed, as compared to 71% in 2023. Meanwhile, survey findings also show that employers are continuing to feel the squeeze financially with the increased costs of benefits, worker retention and recruiting.
PNC Bank released findings from its second annual Financial Wellness in the Workplace Report, which summarizes survey data from more than 1,000 U.S. workers and more than 500 employers to better understand the financial health and wellness of today’s workforce.
“The ultimate goal is to help employers better understand the needs of workers and the generational perspective is unique to this year’s survey,” Kaley Keeley Buchanan, senior vice president and head of PNC organizational financial wellness, said.
The American workforce now spans four generations: Gen Z, born 1997-2012; Millennial, born 1981-1996; Gen X, born 1965-1980 and Boomer, born 1946-1964. Each generation has its unique challenges and stressors in relationship to their personal financial goals and sought-out employee benefits.
Notable findings include:
• Gen Z is the most stressed about personal finances. Of surveyed U.S. workers, personal finance stress was highest with Gen Z (76%), followed by Millennials (72%) and Gen X (72%) and then Boomers (59%).
• Top financial goals vary by generation. Gen Z’s top priority is strengthening their credit rating, while Millennials, Gen X and Boomers all prioritize saving for retirement.
• Benefits play a larger role in retaining Gen Z and Millennial workers. The likelihood of staying with an employer that offers more financial wellness benefits was highest among Gen Z (92%), followed by Millennials (85%), Gen X (72%) and Boomers (64%).
• Gen Z and Millennials are the most concerned about student debt. Results indicated student loan debt is difficult, with 54% of respondents saying it’s the most challenging debt to tackle.
• Gen X workers surveyed were the least likely generation to have worked with a financial planner. The majority of Gen X respondents shared that they do not have enough money to justify using a financial planner.
“The varying financial goals and priorities across America’s generationally-diverse workforce shows how important it is to offer a mix of benefits that can appeal to a wide range of employee needs,” said Buchanan. Although the Boomer generation may not expect an employer to provide financial wellness benefits, they are a valuable tool to attract talent across generations, increase employee retention and company satisfaction.
Financial wellness benefits help employees manage their finances and develop good money habits. These benefits can include: financial education, employer-sponsored retirement plans that match employee contributions, student loan assistance, emergency savings, life insurance, disability insurance and family-related financial assistance. Buchanan said these benefits may tie on to a health savings account, flexible spending account or a lifestyle spending account.
A lifestyle spending account is a benefit that helps employees cover a range of lifestyle expenses as they relate to their physical, financial, emotional and social well-being. An employee chooses how to spend these dollars on items such as healthy meals, pet health insurance, a gym membership or student loan debt, for example. The benefits are personalized in a way that makes sense to the employee.
Buchanan said, “Employers and workers love these benefits due to the flexibility.”
Additional survey findings:
Three in 10 U.S. workers surveyed who have student loan debt say they are at a standstill until it is paid off. This increases to four in 10 among Gen Z workers.
In the last year, access to financial planning benefits doubled for American workers surveyed. Notably, 28% had access to financial planning benefits in 2024 compared to 14% in 2023. One in three used a financial professional in the last three years.
Three in five U.S. workers surveyed say they are living paycheck to paycheck. This sentiment is highest among Gen Z and Millennials.
As the needs of the talent market evolve, so should the way that businesses address them, if they want to attract and retain talent to effectively drive business performance. Buchanan said that employees are the most critical asset of U.S. employers and it’s important to know their pain points and how to provide relief so that employees are able to live a life with reduced stress and greater satisfaction overall. .
This article appears in November SBJ 2024.