The restaurant industry has turned the corner on the high employee quit rates amidst an overall pandemic-driven worker shortage that plagued it through much of 2023.
The improvement has resulted from concerted efforts to make employees’ lives better: think improved benefits like paid time off and retirement plans. And then there’s pay. Wages have improved, too, especially on the quick serve side, where the post-pandemic sales recovery has been better.
Even so these employers still have a problem. Of the 4,717,192 people working in the U.S. fast-food business as of 2023, a major proportion of them are paid on an hourly basis and the majority are financially insecure. This is especially true of the workforce’s youngest cohort, the Gen Zs paid hourly, three-fourths of whom report financial stress that affects their physical and mental health.
It’s something management of quick-service establishments should think about. The individual’s poor financial wellness can contribute to the organization. It lowers productivity, reducing focus and overall on-the-job effectiveness. Employers that have a plan to foster improved financial wellness among their hourly workers will improve their outlook and performance—and the organization, too.
Three considerations arguing for such a plan:
- American employers lose a lot of money to the productivity-sapping financial stress of workers: $500 billion annually.
- Money issues distract workers for almost 20 days each year at work, which equates to some employers paying their hourly people about $4,000 annually for worrying about their finances instead of their job.
- Presenteeism brought on by financial stress can cost more than absenteeism, losing U.S. employers over $150 billion annually in productivity alone.
A plan designed to improve the financial wellness of employees—and ultimately, the organization itself—can follow three steps that reflect differing situations and financial circumstances of individuals.
Step 1: Start by building an understanding of the financial landscape of the workforce, given the differences across jobs and levels. The employer has a role addressing financial stressors, especially since employment itself has a crucial influence in a person’s financial well-being. The job is where they earn their wages, get benefits like health insurance and can build savings for retirement. This lends the employer important insights into employees’ financial situations, a starting point for a deeper understanding of their financial challenges and the basis for a plan to address them.
Step 2: Assess employees’ unique financial needs, then engage with them directly to determine what individuals prefer in a financial wellness program. Their needs should be addressed promptly and effectively. Various tools can help employers gain insights into the financial wellness needs of their people. One is an anonymous survey—anonymity emphasized for candid responses—to get employees’ honest read of the financial stressors they face.
Step 3. Use the intelligence gathered to shape an effective financial wellness solution. One starting point is an inventory of current benefits. Going by employee feedback, identify gaps in benefits that will most relieve financial stress. Research will lead to solutions that fill those gaps and make the existing plan more robust. Over time, a comprehensive financial wellness program will be created that is fine-tuned to the unique needs of your workforce.
Beyond designing an effective financial wellness plan, it’s important to monitor that it’s being used and, ideally, making a difference improving employee financial wellness.
Improving utilization and outcomes is not just a matter of making the sign-up process simpler, more straight-forward and easy to access, for example. Awareness of the program is critical, requiring strategies to get the word out in a way that emphasizes their relevance to employee financial well-being. And it also helps to be aware of new or developing financial stressors among workforce segments. There should also be room for added benefits to address them when needs arise.
Matt Escalante is Senior Vice President of Institutional Investment Strategy at HUB International Investment Partners. In this role, he leads the group retirement plan advisor team that develops quarterly investment reviews and presents to investment advisory committees established by clients. Matt has held a variety of positions at HUB, including Investment Advisor to private clients, Regional Sales Director of group benefits and retirement plans, and Senior Director responsible for working closely with clients to develop retirement planning education and engagement activities for their employees.
Christopher Jamail, CFP, is Executive Vice President at HUB International Investment Partners. He is responsible for strategic business development and fostering company-wide client relationships. Chris employs a team-based approach to ensure comprehensive support for investment advisor strategies with the goal of improving the financial well-being of clients. Previously, he was a financial advisor, Chief Investment Officer and Chief Marketing Officer.
