The skyrocketing cost of living is putting enormous financial pressure on employees, who are on their own in coping with inflation. This constant battle with rising stress and insecurity creates a snowball of negative effects.   TalentLMS’s research into the financial wellness of employees found that 49% have experienced mental health struggles due to money-related stress. That means that the mental stability of almost half of the U.S. workforce is shaken because of financial adversity.

Moreover, our findings unveiled an uneven impact of financial distress on different generations.

Specifically, Millennials seem to suffer the most, with 66% reporting mental health struggles because of money-related worries. They are followed by 59% of the Gen Z and 47% of Gen X employees, while those from the Baby Boomer generation seem to cope somewhat better—with 24% reporting that financial worries have shaken their mental stability.

How Are Employees Coping With Inflation and Financial Insecurity?

Our research showed that the main strategy of employees for coping with inflation is spending less and saving more. Seeing that even Jeff Bezos advised consumers to put off expenditures in the face of a prolonged economic downturn, this trend will likely lead consumers’ behavior so long as the economic instability lasts.

What is interesting to see is that the runner-up strategy in coping with the inflation of employees is learning to manage finances better. However, only one-third of workers get training on financial literacy at work.

What Can Employers Do to Support the Financial Health of Their People?  

As the financial health of employees is closely tied to their companies, employers can do a lot to help their people in weathering the economic storm.  

In addition to offering financial wellness benefits, such as health and medical insurance, retirement plans, and emergency savings accounts, companies can offer resources for improving the financial literacy of employees.  

Especially in light of survey findings that unpacked multiple benefits of financial wellness training: 71% of employees said financial wellness training is helpful in reducing stress and 65% find it helpful for improving productivity.

To build up the financial literacy of their people, companies can offer courses, coaching, and training sessions related to financial literacy, money management, and financial wellness.  

Another thing that companies can do is adjust benefits to the different needs of employees, keeping in mind their age and life stages and choices—people have diverse needs and wants, and not all want the same benefits. For example, younger employees value more guidance from their employer on monthly spending (62% of Gen Zers find it important) than their older colleagues, with 37% of Baby Boomers finding it important.

Moreover, with 48% of employees saying it is important to get advice from their employer on cryptocurrencies, companies can offer new resources for navigating the digital age.  

Employers can do a lot to take better financial care of their people and support them through challenging times. And with only 45% of employees saying their company is doing enough to improve their financial wellness, there’s a lot of room for improvement. Looking for more exclusive content? Check out what’s trending on the Mployer Advisor blog.  

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