Neyber’s appeal to Trade Unions: Encourage employers to work together to provide financial education to combat rising debt in UK households
Neyber, the financial wellbeing company, is calling on unions and employers to align to support employees with record amounts of unsecured debt.
The plea comes as analysis from the Trades Union Congress (TUC) shows that average household debt has increased to £15,385 in the last year, with total unsecured debt jumping to £428bn in the third quarter of 2018.
Neyber suggests that union representatives work with employers to offer employees financial education through their employee benefits packages.
Monica Kalia, Co-Founder of Neyber, explained:
“Currently, total unsecured debt through high interest loans, overdrafts and credit cards is nearly 50% higher than before 2008’s economic turbulence. After years of cutting back, people began to spend again in 2013, yet weak wage growth has meant many people have increased their non-mortgage debt.
“Added to this, from our own research, we know that 63% of employees are borrowing to meet their basic financial needs and this rises to 70% of people under 34.
“So our request to unions and employers is to work together to offer employees – many of whom are in extreme need – financial planning and support through their employee benefit packages. This can help individuals learn to spend their earnings in a wiser way, build good savings habits as well as consolidate their debts to create much needed breathing space.”
Neyber’s DNA of Financial Wellbeing, carried out among 10,000 UK employees and 500 employers, showed that 55% of employees say they want more financial help from their employers. Younger staff in particular are keen to get more support from the businesses they work for - over 72 per cent of 18-34 year olds said they would value financial planning information and help.
Kalia added:
“Times are changing; although many companies were previously reluctant to get involved in employee financial education, concerned it could be intrusive or unwelcome, now many are finding ways to guide them through education and services which help each manage their finances.”
Helping employees better manage their finances is a win-win for businesses: Neyber’s research also showed that when employees worry about money it can lead to stress, mental health issues and extended absences from work. In fact, financial stress costs UK businesses £120.7 billion ever year.