'Employer-based solutions need the flexibility to adapt to the diversity in situations and priorities that exists within populations'
With the pandemic situation still not improving, one in five Canadians (21 per cent) are citing increased financial concern compared to the prior three months.
More than a quarter (27 per cent) of respondents report that the pandemic has worsened their personal financial situation. However, more than half (58 per cent) say their situation has remained the same, while 15 per cent say it has improved, according to Morneau Shepell
Respondents from households reporting an income of less than $60,000 are significantly more likely to report a worsened financial situation (34 per cent) compared to those reporting earnings of $100,000 or more (20 per cent), finds the December survey of 3,000 respondents in Canada.
However, 14 per cent of respondents say they are educating themselves more on financial matters than in the past, while 11 per cent are prioritizing financial contingency planning.
“The good news is that we are also seeing more openness to information and actions that can improve our financial wellbeing,” says Paula Allen, global leader and senior vice president or research and total wellbeing at Morneau Shepell.
“With this, and with access to the right tools, financial guidance and support, there is a great opportunity to have the crisis of the pandemic put us in a better place long term, after we get past this initial strain.”
An earlier Manulife survey found that financial wellness programs were welcomed by workers as stress levels rose amid the pandemic.
Impact on productivity
More than one in five (22 per cent) Canadians indicate that their financial situation is impacting their work productivity, finds Morneau Shepell, with younger people struggling more.
People under the age of 50 are more than twice as likely to report that their financial situation has negatively impacted their work productivity (29 per cent) than those over 50 (13 per cent). Parents are nearly twice as likely to report that their financial situation has negatively impacted their productivity (32 per cent) compared with those without children (17 per cent).
And households reporting an annual income of up to $30,000 have the lowest productivity score (-14), 21 points below those earning $150,000 and significantly below the overall average (-2.3), finds the survey.
Managers have lower productivity when there has been financial strain (-8.1), compared to non-managers (1.5).
A previous survey by Morneau Shepell found that anxiety and depression levels were climbing while productivity fell, largely because of the pandemic’s ongoing impact on finances and economy.
The overall Financial Wellbeing Index was -2.8 for January 2021, says Morneau Shepell, which represents a deviation from the pre-2020 benchmark.
Females (-5.1) have notably lower financial wellbeing scores than males (-0.6). Also, both managers (-3.2) and non-managers (-2.4) are doing poorly.
Among age groups, people in their 20s (-10.5) have worse financial wellbeing compared with those in their 30s (-6.9), 40s (-4.4) and 50s (-0.1). People aged 60 to 69 (3.6) and 70 to 79 (3.5) are the only age groups with positive results.
“Employers are typically not aware of the amount of diversity in financial wellbeing in their population. People with the same salary could have vastly different levels of knowledge, different financial behaviours and very different perceptions of their financial situations,” says Idan Shlesinger, president of retirement solutions and executive vice president at Morneau Shepell.
“It is clear that financial wellbeing impacts mental health and work productivity, but a one-size-fits-all approach will not work to improve it. Rather, employer-based solutions need the flexibility to adapt to the diversity in situations and priorities that exists within populations.”
An earlier Canadian survey found that how much a worker earns does not necessarily correlate to financial wellness.