Well-Being in the Workplace: Why Financial Health Is Foundational to Overall Well-Being

Imagine building a house on a foundation of quicksand. Your home would eventually sink into the earth, leaving you with little to show for your investment – a metaphor similar to the state of many corporate wellness programs today.  

While businesses invest nearly $90 billion annually in workplace wellness solutions, those solutions aren’t actually improving worker well-being.¹ Employees are increasingly burnt out and disengaged, and poor worker well-being is costing American businesses billions in lost productivity.² But it doesn’t have to be this way.

Growing evidence shows what does work to support worker well-being: tailored benefits that improve their financial health.³ In a new brief from the Financial Health Frontiers initiative, we explore why today’s workplace wellness programs aren’t achieving their aims – and what employers stand to gain from ensuring their workforce is financially secure. 

Despite the breadth and investment in wellness program offerings, burnout, financial precarity, and mental health challenges continue to escalate across the workforce. These challenges carry significant costs for employers, and directly influence one of the top concerns among America’s business leaders: employee productivity.⁴ Ultimately, the mismatch between investments in wellness solutions and outcomes raises a crucial question: Why aren’t workplace wellness programs performing better? 

An emerging body of evidence suggests the key to better outcomes may lie in reprioritizing where employers place their investments.⁹ Many buzzy benefits center on interventions that aim to change individual employee behaviors, like well-being apps to support mindfulness, or financial education programs that help people save and invest. These types of individual-level solutions often focus on the symptoms of poor well-being, but fail to address root causes. Recent research suggests that focusing on solutions that address root causes can be more effective than focusing on treating individual-level symptoms.¹⁰

This is not to say individual-level solutions have no place in a broader wellness strategy.  But it is possible that individual-level solutions are most effective only if employees already have a relatively stable financial base.

The more people feel equipped to handle their finances, the more likely they are to report higher levels of overall well-being and engagement.¹² Improving the financial well-being of workers also delivers financial benefits to employers, who are hemorrhaging billions of dollars a year in lost productivity.¹³ 

By building overall well-being programs on a foundation of employee financial health, we believe employers can stem the tide of increased burnout, declining engagement, rising financial precarity, and concerns over low productivity and its myriad ill effects.

1. 1. Impact-based benchmarks: By including more impact-based metrics – such as living wage data – employers can start to better assess the effects their wages and benefits may have on their employees’ lives.
   2. Outcomes over inputs: The average employer has 22 programs offering more than 50 types of benefits.¹⁴ Focusing on outcomes and not inputs – like the number of programs offered – can help organizations prioritize their spend on solutions more likely to move the needle.
   3. New assessment frameworks: What are the essential benefits workers need to achieve financial stability? These are among the frontier questions shaping the future of workplace financial and overall well-being.

Thank you to the many Financial Health Network staff who supported the creation of this publication.