Press Release: Bare minimum from many employers driving poor productivity
A “tired and stressed workforce” could derail the new government’s efforts to boost the UK economy.
New research published today by the David Hume Institute shows that a third of employers only provide the bare minimum when it comes to sick pay and pensions.
The report, “The Great Risk Transfer”, highlights how staff in hospitality, retail and social care are the most financially vulnerable and that over a quarter of Scots lose sleep over money worries.
The research finds:
more than two-thirds of employers (70 per cent) are concerned over the impact of financial strain on their employees and their productivity, citing increased stress on managers and other staff (35 per cent) and a rise in absenteeism due to poor health (28 per cent)
But
a third of employers (33 per cent) in Scotland do not offer any enhanced benefits as part of their employee benefits package.
more than half (56 per cent) do not currently include financial wellbeing in strategies to support employees.
Susan Murray, director of the David Hume Institute,said
“It is hard for the economy to thrive when a quarter of the workforce is losing sleep over their finances. Over two-thirds of employers have noticed the impact of financial strain on people’s performance at work. It is imperative that the UK Government forges ahead with plans to update employment legislation. Steps must be taken to rebalance the risks for people and the economy to thrive now and in the future.”
The Great Risk Transfer report recommends the need to:
Recognise employers’ power to drive change. Employers should recognise the connection between financial wellbeing and productivity and how their actions might alleviate employee’s pressures.
Increase understanding of Living Pensions: Government and employers should work together to increase understanding of the need for Living Pensions and that employees on auto-enrolment minimums are not currently likely to be saving enough to live well in retirement.
Complete the Pension Provision Review. The review of pensions provision signalled by the Labour Party before the 2024 election should go ahead and include a specific focus on potential improvements and innovations in workplace pensions.
David Thomson, Head of Policy and Public Affairs at the Institute and Faculty of Actuaries, which part-funded the research, said: “The transfer of risk from institutions to individuals is not necessarily bad but the evidence suggests that this is falling unevenly, with many not always understanding the risk. It would be wise to ensure that the “dials are set” to balance the risk of the individual against the institution.”
Catherine McWilliam, from the Institute of Directors, which represents 1,000 business leaders and decision-makers in Scotland said: “The findings chime with feedback from our members. We have had a decade of uncertainty and fire-fighting in Scotland with rising costs against the backdrop of a tight labour market. We need to have an honest and transparent discussion to find solutions with the private sector working with the government.”
Scott Edgar, of the Diffley Partnership, said: “Our research shows that the majority of employers cite some concerns over the impact of financial strain on their employees. In particular, they highlight issues such as increased stress and rising absenteeism linked to financial wellbeing issues, which are affecting productivity and overall workplace wellbeing."
NOTES TO EDITORS
The Great Risk Transfer: employment and financial wellbeing analyses the shift in responsibility for financial wellbeing from institutions, such as governments and employers, to individuals. The report is based on qualitative and quantitative research with employees and businesses – ranging in size from 60,000 employees to less than ten - across Scotland. Read the full report.
The David Hume Institute commissioned the Diffley Partnership, an independent research agency based in Edinburgh, to investigate employer attitudes to the Great Risk Transfer. The survey was conducted in May and June 2024 and is based on responses from 550 businesses. The survey results is published as an appendix to the main report here.
Image credit: sharing thumbnail image by Nuno Silva free from Unsplash 16.08.2024
