The Relationship Between Staff Turnover and Financial Wellbeing

High staff turnover is a challenge that many organisations face, impacting everything from team morale to the bottom line. While there are numerous reasons why employees leave, financial stress has emerged as a key factor. Improving the financial wellbeing of employees is not just a moral imperative for employers but also a strategic move to reduce turnover.

Staff Turnover and Its Hidden Costs

Employee turnover is more than just a statistic. Behind every resignation lies a ripple effect of costs, disruptions, and loss of expertise that impacts the entire organisation.

The True Cost of Turnover

When an employee leaves, the cost to replace them goes beyond the immediate expense of hiring and onboarding.

• Recruitment costs include job advertising, agency fees, and staff time spent on interviews.

• Training and onboarding costs involve equipping new hires with the knowledge and tools to succeed.

• Productivity loss occurs as new employees require time to reach full efficiency, and departing employees often leave gaps in processes.

Staff turnover also impacts team morale, leaving remaining employees burdened with extra work and uncertainty, potentially leading to further resignations. One factor that contributes significantly to turnover is financial stress.

Employee Financial Wellbeing

Financial wellbeing is about more than just salary figures. It encompasses an employee’s ability to manage their financial needs, plan for the future, and feel confident about their financial stability.

What is Financial Wellbeing?

Financial wellbeing can be broken down into three key components:

• Financial Resilience: The ability to handle unexpected expenses or income fluctuations without severe hardship.

• Financial Confidence: Feeling secure and informed about making financial decisions. 

• Financial Wellbeing: The absence of financial worries that negatively impact mental and physical health or job performance.

What is Earned Wage Access?

Earned Wage Access (EWA) is an innovative benefit that allows employees to access a portion of their earned wages before payday. Rather than waiting weeks for the monthly or fortnightly pay cycle, Earned Wage Access provides employees with financial flexibility when they need it most.

How Does Earned Wage Access Improve Financial Wellbeing?

By reducing the financial strain of waiting for payday, Earned Wage Access addresses critical pain points related to employee financial health.

1. Builds Financial Resilience

Unexpected expenses, such as car repairs or medical emergencies, can wreak havoc on household budgets. Earned Wage Access gives employees a financial safety net, reducing the likelihood of turning to payday loans or credit cards, which often lead to cycles of debt.

2. Reduces Stress and Anxiety

Many employees live paycheck to paycheck, leading to constant financial worry. Knowing they can access their earned wages as needed significantly reduces anxiety and improves focus at work.

3. Promotes Empowerment and Confidence

Earned Wage Access empowers employees to take control of their income. Whether it’s managing bills or seizing opportunities to save on purchases, this newfound financial freedom fosters confidence in their ability to manage money.

Ultimately, employees who experience less financial stress are happier, more productive, and more likely to remain loyal to their employers.

The Proven Link Between Earned Wage Access and Staff Turnover

Organisations offering Earned Wage Access as part of their benefits package are seeing remarkable results in employee retention.

At Level, we’ve worked with clients who have experienced up to a 50% reduction in staff turnover after introducing Earned Wage Access.

Transforming the Employee Experience

Reducing staff turnover requires more than just competitive salaries and perks. Addressing the root causes of turnover, such as financial stress, is key to creating a workforce that feels valued and supported.

Earned Wage Access is more than a financial tool; it’s a strategic solution that empowers employees while delivering measurable benefits for employers.

If your organisation is ready to take the next step in supporting employee wellbeing and reducing turnover, it’s time to explore Level. Click below to discover how our Earned Wage Access platform can make a difference for your team.