Ninety-four percent of employers responding to a recent survey cited employee financial literacy as being extremely important, or important in reducing the vulnerability of the American economy to major economic crises.
The survey, conducted by the Personal Finance Employee Education Foundation with the support of the Employee Benefits News, also found 83.3% (compared with 70% previously) think the employer provision of basic workplace financial education is important or extremely important to the overall level of productivity in their organization, and a majority of 69.7% (up from 53%) think employers who pass benefit costs on to their employees have a responsibility to provide ongoing financial education to help them make appropriate financial decisions.
While 81.8% (down from 88%) of respondents provide the required investment/retirement education associated with retirement plans, only 51.5% provide basic workplace financial education, defined as including budgeting, debt reduction and credit management. However, it should be emphasized that this is up from 28% in the previous survey.
Several barriers were cited for providing basic workplace financial education. The cost is too high for 54.5% (up from 49%); 48.5% (down from 58%) said employees would sacrifice work time to attend; and 69.7% (down from 71%) noted that there were too many higher-priority competing items. An even 50% were not sure they could get upper management to buy into the provision of workplace financial education. It should be noted that this number is unchanged.
“The value of employee financial education is clear,” said Judith Cohart, president and chief executive of the Personal Finance Employee Education Foundation. “The challenge is to overcome the barriers that prevent employers from providing this benefit to their employees.”
The Personal Finance Employee Education Foundation is a nonprofit organization that promotes financial education in the workplace, showing employers that providing financial education can improve worker productivity and employer profits. For more information, go to www.pfeef.org.