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Overall wellbeing is essential for a healthy, energised and productive workforce. There are many elements that feed into a successful wellbeing strategy.
Here we look at the connection between physical, mental and financial health in achieving wellbeing.
The competition for talent and skill will only intensify due to changing demographics and an ageing workforce. Workers increasingly expect flexibility in working practices and personalisation of benefits.
Our research suggests that the younger generation particularly is looking for benefits that promote health and wellbeing, and new technology allows for effective and efficient delivery to diverse and remote workforces.
Work life integration
When designing an effective programme, employers need to take a step back and reflect on their employees’ needs.
Mercer has identified eight dimensions of wellbeing:
1. Physical: taking good care of the body
2. Emotional: expressing and managing feelings
3. Spiritual: having meaning and purpose in life
4. Social: enjoying regular interaction with others
5. Financial: managing income to good effect
6. Intellectual: having challenges at work which stretch and teach
7. Environmental: thinking positively about the world
8. Occupational: working towards satisfying goals
Sigmund Freud said the simple happiness equation is ‘being able to work and able to love’. Yet we are all exhausted because of our inability to hold the competing sides of our lives together. The work life balance is discussed in many circles, but this no longer accurately describes what employees need. Employers need to think of ‘work life integration’ rather than work life balance, since ‘balance’ speaks as much to an employee being stuck as it does to them finding harmony.
Productivity and health
Mercer’s Healthiest Workplace annual survey with Vitality Health assesses employee health and wellbeing. Our research shows that many workers are biologically older than their chronological age, which has implications for the workplace.
A lack of exercise, poor diet and other factors lead to a productivity loss of 30 days for every employee a year. Productivity, then, is not just a result of employee engagement at work but also of the state of their health.
Fortunately, a lot can be done to improve health. Employers need to consider the interconnectivity of all the dimensions of wellbeing to build a successful benefits package.
Data driven analysis and strategy
Accessing and analysing meaningful employee data is key to understanding employee health.
Creating a dashboard that brings together the data insights from various sources can improve analysis of employee wellbeing. For example, health insurance data shows disease incidences, while income protection providers might have insight on mental health, and absence data could show high instances of cold and flu. The key is not to look at the data in isolation.
When considering mental health, employers need to consider physical health as interconnected to mental wellbeing. For instance, musculoskeletal problems can be linked with depression. Employers that can understand their employees’ needs and appreciate how different elements of wellbeing interlink will see greater return on investment for their benefit spend.
Mercer reviewed the mental health management strategy in an organisation because there had been an increase in medical claims. We found a lack of integration between occupational health, private medical insurance, the onsite GP and employee assistance. Meanwhile cohesive data sets were limited. We designed a strategy which incorporated a gatekeeper assessment and integrated pathway between providers to give a seamless transfer of cases which ultimately resulted in the employee getting the right level of treatment.
The outcome of the strategy was a 9% reduction in the number of claims; a 13% reduction in the total costs of claims and a 16% reduction in the average cost of claims. But most importantly there was a 60% improvement in patient outcomes which makes life better for the individual.
Ultimately there is interdependency between health and wellbeing data on the one hand and performance data on the other. These data sets need to be cross referenced. In addition, any data driven strategy needs to reflect the diversity of modern organisations and the associated Individual Value Proposition for employees (which goes beyond the Employee Value Proposition).
Diversity and inclusion criteria include: race, ethnicity, gender, age, sexual preference, life stages, and the intersectionality between all of them.
Health and wellbeing pathways include proactive and reactive elements. They are about improving various dimensions of wellness such as cardiovascular health, maternity care or mental health care, cognitive health and so on.
Well defined pathways can reduce absence rates by 40%. If you include presenteeism figures, the return on investments is significant.
For an integrated health and wellbeing strategy to work, organisations need to analyse the integration data and insight into their diverse workforce’s needs. They also need intervention at the heart of the strategy. They also need good governance such as ensuring there are company policies in place. Finally, employers need an excellent communications strategy that lets people know about, and take advantage of, the benefits on offer.
Understanding the link between mental health and financial wellbeing
There is increasing evidence to show the two-way relationship between financial health and mental health. The persistent stigma around mental health issues combined with the taboos of having monetary problems create a complex situation to get underneath and resolve.
Mercer research shows that half of people are worrying about saving for retirement while 45% worried about meeting day to day expenses or being unprepared for the unexpected. More than one third are concerned about repaying debts; a third are just managing financially, while 40% expect to work beyond favoured retirement age and 26% are getting by using credit cards. Seventeen million UK workers have less than £100 in emergency savings which means little resilience against unexpected expenses.
Mercer’s 2018 Healthy, Wealthy and Work Wise research covered 12 countries and received 7,000 responses. The UK results found 65% of employees expect to partially or fully fund their retirement by continuing to work. This makes good health in later years important both for the individual and the employer.
If organisations have people remaining in employment for 10 or 15 years longer than they might have done in the past, keeping them well is important. An ageing workforce may be positive for some organisations but could be more challenging for others and increase health care costs.
Employers are in a unique position to help. More than four-fifths (82%) of employees trust their employer for financial advice and support; a greater proportion than those who trust an independent financial adviser.
Employers should consider how they can use the position of trust to improve financial and mental health.
How to build a financially healthy workforce
There are four pillars of financial health and if someone is healthy they have control over all areas.
Pillar one: Control over day to day expenses
Pillar two: Prepared for the unexpected
Pillar three: Freedom to make choices in life and access helpful information
Pillar four: On track for the future
Employers can intervene in the workplace to help employees construct each of these pillars.
For example, they can provide tools to help with budgeting; education; building house deposits; financial health checks; and broader savings products beyond pensions.
There are different approaches to tackling financial wellness through the workplace. Some employers choose to be proactive and strategic. They are thinking about where their employees are now and targeting their long-term needs. Other employers are tactical and reactive. They might have specific problems within their workforce and want to take some steps to counteract those. Regardless of the approach taken, employers who understand how to enhance their employees’ well-being will develop a durable competitive advantage in the upcoming war for talent.