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New Health Study Shows Widespread Employee Financial Insecurity


Last Update: March 19, 2021

Americans spend between 25 percent and 33 percent of their lives in the workplace¹. 

Mental Health America (MHA) began surveying employees in 2015 to determine the impact of the workplace on their mental health.

In this year’s report, Mind the Workplace 2021, MHA focuses on the challenges brought about due to the COVID-19 pandemic. 

Concerning financial insecurity, the survey asked each respondent if they experienced the issue in the following ways:

  • Worry about paying for living expenses
  • The ability to afford to create an emergency savings plan
  • The ability to afford self/family health care expenses

The findings show that employees have continued to experience financial insecurity during the pandemic to an even greater extent.

Additionally, 25 percent of those with anxiety and depression said that financial problems were a main contributing factor to their mental health problems². 

Regardless of company size or industry, employees are struggling in the following ways: cost of living, saving for emergencies, and cost of health care.

1. Cost of Living

The cost of living is a big problem for those making less than $60,000 a year.

  • 58 percent worry about the ability to pay for day-to-day living expenses
  • 20 percent are very concerned 

The MHA survey found that perceptions about having enough money to pay for living expenses mattered as much as the actual ability to do so.

Additionally, the survey found that until an employee earned between $60,000 and $80,000, employees did not feel they could adequately pay for their expenses.

Approximately 80 percent of those surveyed fell below this threshold.

2. Emergency Savings

Six out of 10 employees do not feel they make enough money to save for an emergency. Three out of 10 feel strongly that this is true.

To feel comfortable starting an emergency savings account, employees felt they needed to make at least $80,000 per year.

However, employees needed emergency savings during 2020 due to higher than usual unemployment and temporary layoffs caused by the pandemic. And of those who did have savings, 14 percent have depleted them³. 

Emergency savings has a very high correlation with financial stress.

These numbers show that employees are not prepared for a crisis, especially a global one lasting as long as COVID-19 has.

3. Healthcare Costs

Health care costs continue to rise, and employees look to employers to help mitigate these costs by providing affordable health care coverage benefits.

Currently, 50 percent of Americans receive their health insurance through an employer4. 

The survey found, however, that 34 percent of employees cannot afford their health care costs. This included:

  • Premiums
  • Deductibles
  • Co-pays
  • Out-of-pocket expenses
  • Out-of-network costs

This was a bigger problem as employees made less, with those making less than $20,000 more likely to have this issue.

How Financial Wellness Programs Help

The year 2020 was not a good year for employee stress, and the MHA study also found that employees felt their employers didn’t understand or care about their mental health needs. This led to over 50 percent of employees stating they were actively looking for another job.

This type of stress is detrimental to any organization. Financial stress leads to low productivity, absenteeism, presenteeism, on-the-job accidents, and more.

One study shows that financial stress costs companies $500 billion5, or $2,800 per employee, each year. 

The MHA study suggests that companies need to make employee mental health a priority. One way to do so is to offer a financial wellness benefit.

Even when salaries remain the same, Enrich found that employees using their financial wellness program could make significant changes to increase their financial wellness. These include:

  • Saving for specific goals 
  • Increasing emergency savings
  • Contributing to an employer-sponsored retirement plan
  • Paying off credit cards each month

An employee financial wellness program provides information and actionable steps to help employees, no matter their income, learn to make appropriate financial decisions.

As employees get a better handle on their finances, their financial stress lessens.



1 - www.bls.gov/news.release/pdf/empsit.pdf 

2 - www.mhanational.org/sites/default/files/Spotlight%202021%20-%20COVID 19%20and%20Mental%20Health.pdf  

3 - www.cnbc.com/2020/09/01/nearly-14percent-of-americans-have-wiped-out-emergency-savings-during-pandemic.html 

4 - www.livingwage.mit.edu/articles/61-new-living-wage-data-for-now-available-on-the-tool 

5 - https://www.salaryfinance.com/us/financial-wellness-guide-2019/

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