More Job Loss, Increasing Uncertainty.... How Can You Help Your Employees?

In the news, Initial Jobless Claims increased more than expected, indicating ongoing weakness in the labor market. The ISM Manufacturing Index also came in slightly worse than expected.

Just yesterday one of our services providers closed their doors.  This is happening often under the radar more than we know.  How is this affecting your business?  Well for one, many employees are feeling concern about their job security because a companies finanical strength is not always completely known.  And even if the company that someone works for is secure, what if their service or parts providers go under?  Does this leave them hanging?

We often think of  financial distress as a family issue.  What if we think of the dollars at stake in financial hardship in a different context?  Think of it not as the costs imposed on a business by customers that don't pay but as the costs imposed on a business by employees who can't pay.

In 2003, Dorothy Bagwell and Jinhee Kim published Financial Stress, Health Status, and Absenteeism in Credit Counseling Clients. They report on an analysis that they conducted using a random sample of consumers who contacted credit counseling agencies. These consumers were asked questions about their financial stress, absenteeism, and demographic qualities. Bagwell and Kim perform a regression analysis that indicates that financial stress is strongly correlated with missed work days. The effect of financial stress was more profound than many other factors, including marital status, gender, age, household income, and even health.

The study's findings suggest that companies would improve their balance sheets by helping their employees with their balance sheets. Employee absenteeism has high economic costs; businesses interested in reducing such costs ought to consider whether they should be supporting legislation or programs that seek to reduce the incidence of financial stress.

Many companies offer Employee Assistance Programs; given that approximately 3 million households seek credit counseling annually, it would seem crucial that these programs have reliable resources to help employees with financial problems.

The Society for Financial Awareness offers these programs as a Free service to employers.  Lunch and Learn workshops are an excellent way to extend help to your employees especially in this time of need and uncertainty.  And you will FEEL great helping your employees feel secure about their future.