Article

Employers that want gender equality must tackle women’s financial wellbeing

Across the globe, soaring inflation, geopolitical instability and stagnating wages have created a cost-of-living crisis. Against this backdrop, it’s no surprise that money is a serious source of concern for many employees.

Mother with child struggling to pay heating bills

Across the globe, soaring inflation, geopolitical instability and stagnating wages have created a cost-of-living crisis. Against this backdrop, it’s no surprise that money is a serious source of concern for many Australian employees. However, our research shows that women are more likely to suffer. That’s why companies that want to promote equality in the workplace should prioritise financial wellbeing initiatives.

The World Economic Forum warned in 2023 that “higher costs of food, energy and housing, causing lower real incomes, will result in trade-offs in essential spending, worsening health and wellbeing outcomes for communities.”

This is now a reality. Our Global Talent Trends Research found that eight out of 10 employees are at risk of burnout in 2024 and 43% of employees are dealing with financial strain. A staggering six work hours per person per month are lost to money worries.

Meanwhile our Health on Demand research shows that rising costs have left over a fifth (21%) of employees alarmed about their ability to afford the healthcare they need for themselves and their families. This may explain why a large proportion are going to work even when they’re sick. Women on or below median income worldwide say they have worked while physically unwell (64%) and only half (52%) report thriving in their current roles.

Worse for women

We are seeing that financial insecurity hits women the hardest, with 26% of women finding their current financial situations challenging, compared to 18% of men, with less confidence they can afford healthcare costs. Women also report lower levels of employer-sponsored benefits than men, which is likely to compound financial troubles.

This may help to explain why women generally report higher stress levels than men, with half saying they are highly or extremely stressed in everyday life compared to 44% of men. Despite stressors, the majority of women (60%) say they are thriving at their jobs, but this drops to 54% among single mothers - while for men this is 66%.

However, the consequences of these stressors are clear. Women are more likely than men to say work pressures (59% versus 51%), poor leadership (40% versus 38%) and toxic culture (39% versus 36%) are potential causes of burnout. The various stressors influence how women perceive whether their employers care about their health and wellbeing. This is evidenced by the fact that they’re also less likely to say their employers care about their wellbeing (63% versus. 69%) and less likely to agree that their employers design their jobs and work with wellbeing in mind (49% women versus 56% of men).

Although the benefits a company offers may be good, because of the various stressors, there is a gap between male and female when it comes to perception of care.

Understanding intersectionality

Of course, women are not one homogenous group, and other characteristics can compound financial vulnerability according to Health on Demand research. Although 83% of employees are confident they can afford the healthcare they need, Health on Demand research shows that single mothers are the least confident of any group that they can afford the healthcare they need for their families (32% not confident). Similarly, more caregivers (who are more likely to be women) say medical expenses have caused financial hardship for them and their families (36% versus 18% non-caregivers).

Income also has a significant impact. Thirty-one percent of employees in the below-median income group are not confident they can afford the healthcare they or their families may need versus 15% of those with above-median remuneration. Twenty-nine percent of part-time employees are worried about healthcare affordability.

Loss of earnings for caregivers has been measured by the US Department of Labor, which revealed that caregiving responsibilities for dependents reduce a woman’s lifetime earnings by US$295,000, affecting their career progression, wages and retirement savings. Eighty percent is attributed to lost earnings - due to caregiving, and 20% is lost retirement income as a result of lower wages. In Australia, carers also lose a significant amount in lifetime earnings and superannuation. A Carers Australia study found that a primary carer will lose A$392,500 in lifetime earnings and A$175,000 in superannuation, to age 67.

The role of benefits

Improving wellness for women

According to our People Risk 2024 survey data, 37% of HR and risk professionals are concerned about rewards packages not meeting the needs of an increasingly diverse workforce.

They’re not wrong. For instance, our research shows that employers are targeting the wrong solutions when it comes to women’s wellbeing. Specifically, there is often a gap between the benefits employers offer and those that women say they would find most helpful.

Women ranked the following benefits most helpful, based on a list of specific reproductive health, digital health, mental health and general supports queried in our Health on Demand 2023 survey:

Preventive cancer screenings
An app to help find medical care when and where I need it, even in the middle of the night
Menopause support
Genetic test that reveals health risks and suggests lifestyle changes and screenings
Apps and devices to self-manage wellbeing

Source: MMB’s Health on Demand 2023 report

Both men and women showed similar levels of support around the reproductive benefits they found important.

Source: MMB’s Health on Demand 2023 report

Tackling healthcare affordability

There is strong evidence that providing the right benefits can help tackle healthcare affordability. In fact, employees who receive higher levels of health and wellbeing benefits through their employers are significantly more confident that they can afford healthcare.

An encouraging 93% of those who receive 10+ benefits say they are confident they can afford the healthcare their families need compared to just 65% of those with zero employer benefits.

We see that benefits that employees only use once they become sick (like critical illness insurance) don’t have the same visibility as those used more frequently — such as a healthy work environment or gym benefits. That’s why it’s so essential to offer employees a mix of resources and solutions.

Building mental health awareness

Our People Risk Report: Pulse Update 2023 found that 66% of surveyed HR and risk professionals in Australia and New Zealand claim employee health & wellbeing is likely to severely impact their organisation in the next three years.

Our Health Trends 2024 research shows that only 40% of insurers globally offer virtual mental health counselling, and 61% cover 10 or fewer counselling session per year under their group benefit plans. Tackling these gaps can help support women in the workplace.

Improving retention

Employers are increasingly worried about talent attraction and retention. Financial wellbeing plays a crucial role here. Our Global Talent Trends research found that 34% of employees say fair pay helps their commitment to stay at an organisation and 38% expect their employers to provide a living wage for all workers.

A further 25% say flexible working policies are an important factor when it comes to staying with the same employer. For women with caregiving responsibilities, flexibility may be necessary to allow them to work at all.

How to succeed – Hitting the mark on financial wellness

Despite the clear need for financial wellbeing programs, benefits and support, it appears that this is a blindspot for organisations.

Employers can consider enhancing financial wellbeing support for women across a spectrum of financial needs. Think about offering financial coaching and advice using a ‘three-step approach'

First, help women gain control over day-to-day finances through budgeting and debt management.
Second, help them prepare for the unexpected through short-term or emergency savings and insurance.
Finally, support employees in getting on track to meet financial goals such as retirement and home ownership, by providing education and tools.

Specific actions employers can take:

Covering employee-paid contributions for health, risk protection and retirement plans to reduce opt-outs during earnings troughs
Providing guidance or, even better, a vehicle for employees to build an emergency savings plan
Funding spending accounts for certain kinds of purchases (e.g., fitness, solar panels, ergonomic equipment)
Helping people protect themselves financially by offering voluntary home, auto, flood, fire, travel or personal life/disability insurance
Seeking opportunities to offer easily accessible discount programs and education assistance
Providing more flexible retirement options
Providing more preventive care programs to reduce incidence of financial hardship from more progressed and serious conditions
Reviewing caregiving programs and supports

These actions are inclusive and benefit the full workforce! Such actions will provide “tangible” benefits for employees as long as they’re aware of the supports available. That's why high-impact communication campaigns are essential to ensure employees have the information they need.

Success involves catering to a spectrum of financial needs

Women are hugely concerned about the state of their personal finances – and too often, employers have fallen short of providing the support their people need. For too long, financial health has trailed behind physical and mental health on the list of employers’ priorities. Now is the time to act!

Originally published 7 March 2024 by Elva Rios (Mercer Marsh Benefits, Mexico) and Julia Radchenko (Mercer Marsh Benefits Singapore).

young stylish women laughing in city park

Report

Health on Demand 2023

03/04/2024

Athletic Asian man exercising happy and healthy in blue t-shirt listening to music

Report

MMB Health Trends 2024

29/10/2023

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