Almost half of UK workers are borrowing to meet day-to-day financial needs and a quarter have monthly income fluctuations of more than 10 per cent, a report by Neyber has found.
The report has found Brexit and ‘zero hours’ contracts are challenging the financial wellbeing of UK workers, with 35 per cent of those surveyed saying Brexit has made them change how they feel about their finances in general, although the research does not state whether it has had a positive or negative impact. Brexit has made 29 per cent change how they feel about their savings and 22 per cent change how they feel about their borrowing.
The report shows 39 per cent of employers think employees would approach them for financial assistance, but only 3 per cent of employees would turn to them for help.
The findings from Neyber, the payroll lending company, found that 48 per cent of workers are borrowing money to meet their basic financial needs, rising to 67 per cent of workers under 34 years of age.
So-called zero hour contracts are believed to have contributed to the finding that that a quarter of UK workers have an income fluctuation of more than 10 per cent each month, increasing to 45% for those aged 18 to 24.
Neyber says this fluctuation in income is contributing to financial exclusion due to an inability to access cost effective financial products. A quarter of employers polled felt their employees would be considered financially excluded.
The report found that while employees feel uncomfortable about approaching their employer, 42 per cent are looking to employers to offer support and guidance.
More than half – 54 per cent – of employers said they believe poor financial wellbeing impacts on employee behaviour, with 56 per cent saying it impacts job performance, 54 per cent saying it impacts relationships at work and 51 per cent saying it impacts relationships with management.
Neyber head of insights and engagement Heidi Allan says: “A lack of longer-term financial resilience built into UK households, along with fluctuating earnings leaves a large portion of the UK population poorly prepared for the future. Unfortunately, it means they are also ill prepared for day-to-day changes such as rises in essential spending like utilities.
“Employers are seeing the affects on their employees, with 40 per cent believing financial concerns are causing employee stress and 23 per cent believing their employees are losing sleep because of money worries.
“A positive shown in this year’s report is the increase in awareness within the employer community – their next step is to take action to help employees improve their own personal outcomes for the good of both audiences.”