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Employee wellbeing in a shaken population
17 July 2020

Employee wellbeing in a shaken population

Insight Partner

Pension schemes don’t exist in isolation - the pension strategy always has to be looked at in the joint contexts of the wider employee benefit and engagement strategies. ‘Better outcomes for pension scheme members’ takes joined-up thinking that incorporates the evolving employee experience. The COVID-19 pandemic is the biggest crisis that the UK has had to deal with since World War II, resulting in a seismic impact on the public, government, economy, employment and education. For large sections of the UK workforce, financial confidence has been shaken to its core. As we transition towards the very gradual return to whatever shape and form the new ‘normal’ takes, we should be realistic about the unique challenges, uncertainty, fears and concerns affecting the UK workforce. 

Employee wellbeing

In our own work with employers, Barnett Waddingham approach employee wellbeing based on six key pillars - job security, financial security, health, support, protection and work/life balance – designed to help employers identify their own workforce’s specific issues and priorities. In the current crisis, job security and financial health are coming into laser sharp focus, and our research shows that the relationship between employers and employees has never been more important.

Our April 2020 survey looked at a representative selection of over 2,000 UK employees to understand their situations, how they are feeling and coping, and how well they feel supported by their employer.

Meet the people
  • 79% of the employees in the group we surveyed normally work full-time and 21% work part-time.
  • Among full-time employees, 22% are currently furloughed, compared to 36% of part-time workers.
  • Furloughing has been used more among employees who are aged 18-24 (30% furloughed) and those with the lowest household incomes, where more people work part-time.
  • Furloughing has been used more in the Consumer & Industrial Goods, and Services sectors (36% and 34% of employees we surveyed have been furloughed), than in sectors where employees can work from home such as IT, Financial Services and Communications.
  • Perhaps surprisingly, 23% of employees in Professional Services have been furloughed. 
  • Regionally, the proportion of furloughed employees is reasonably consistent in a range between 23% & 27%, although Northern Ireland (38%) and the South East (30%) are higher, and the North West lower at 19%.

Two thirds feel unconfident about the health of their finances UK employees have experienced a sharp drop in confidence in their financial health in light of the COVID-19 pandemic. Comparing how they felt before and after the pandemic, three-fifths (59%) of employees were confident in their finances then, but now that figure has dropped to just over a third (35%).

Headline numbers
  • Workers who have been furloughed have seen the most significant drop in confidence, falling from two thirds (65%) to under a quarter (23%).
  • Yet big firms are failing to adequately communicate with their employees on financial health, with four in ten employees (42%) getting radio silence from their employer.
  • Less than half (46%) of the UK workforce say that they are satisfied with the communication from their employer during the COVID-19 pandemic.

Furloughed workers have been hit the hardest by the pandemic. They have experienced the greatest drop in their financial confidence from three-fifths (60%) to under a quarter (24%.) The Government’s job retention scheme has enabled employees to retain their jobs, but with many living on 80% of their normal salary and with increased anxiety about their job security, it has impacted their sense of financial health. Moreover, a fifth (18%) of employees currently on furlough ultimately expect to be made redundant.

 

Younger workers, aged 18-24, are the most insecure about their finances at just under a third (32%) now reporting financial confidence, compared to a half (52%) before COVID-19. Men feel more confident than women in their financial health both before and after the pandemic. Men’s financial confidence has dropped from 60% to 36%, versus women’s from 58% to a third (33%) now.

Communications and engagement strategies

Communication from employers is key to maintaining confidence and wellbeing, and this is a critical time to be engaging with employees to help reduce their worries about their financial and mental health. Yet a third (34%) of employees say they have received no communication, and a quarter (27%) only a little communication from their employer about financial health.

For furloughed workers, who are more likely to be struggling at this time, almost a third (31%) have heard nothing from their employer to support their financial health, 28% have had a little communication, and almost half (46%) have had no communication regarding their mental health.

Perhaps surprisingly, the biggest firms are falling furthest behind when it comes to communicating with their employees about financial health. Two-fifths (42%) of employees at firms with over 5,000 staff say that they have received no communication from their employer. This compares to just over a quarter (27%) of employees at mid-sized firms with 50-200 staff, and the group who are also most likely to receive ‘too much’ communication.

What employees are saying about employer communications

Effective and engaging communication is about the balance between quality and quantity, and, ironically, there is a very strong correlation in the results between the two:

  • Capital - Less than half (46%) of the UK workforce say that they are satisfied with the communication they’ve had from their employer to support both their mental and financial health during the COVID-19 pandemic.
  • Younger employees are the most satisfied with financial health communications but the least satisfied with mental health communications.
  • The larger companies have delivered more effective mental health communications, but the trend is the opposite for financial health communications.
Moving forward - investing in engagement

Our research reveals a concerning lack of satisfaction with employer/ employee communication. Even as employers face the significant challenge on business operating models, radio silence is not okay and can only serve to make the task of maintaining pension scheme engagement all the more difficult.

UK employees are obviously deeply concerned about the future and their financial survival. It is essential for them to feel that their current situation is understood.

Notes/Sources

This article was featured in Pensions Aspects magazine July/August edition.

back to Pensions Aspects Magazine

Last update: 21 July 2020

Julie Walker
Julie Walker
Barnett Waddingham
Principal and Senior Pensions Manager

Senior Pensions Administrator

Salary: £24000 - £36000 pa

Location: Birmingham City Centre

Pensions Client Services Coordinator

Salary: £40000 - £45000 pa

Location: Birmingham City Centre

Pension Fund Accountant

Salary: £28000 - £30000 pa

Location: Birmingham City Centre

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