Lost workdays due to financial worries are estimated to cost UK employers £10.3bn annually, up from £6.2bn two years ago, according to analysis by the Centre for Economics and Business (CEBR).
Presenteeism is another area of concern, when employees attend work but have significantly reduced productivity due to personal and health-related factors, the research found.
Health issues, family problems and job security were all issues of concern, but financial concerns came out as the main issue affecting workers.
Over the past two years, the proportion of both full-time and part-time private sector employees missing work due to financial concerns has risen to 12%, up from 10% previously, the research on behalf of Aegon UK found.
On average, employees lost 4.7 workdays per year, leading to more than 3.2 million private sector workers requiring time off in the past year, equating to 16 million workdays lost.
Old and young divide
Older workers appeared more resilient as they were least affected, with only 5.8% of individuals aged 45 or older reporting taking leave due to financial worries.
In contrast, younger workers aged 25 to 34 recorded the highest share of absenteeism related to financial concerns, at 18.6%.
Those in the age groups of 16 to 24 and 35 to 44 followed suit, with shares of 14.7% and 14.4% respectively.
Absenteeism accounted for an estimated 16 million workdays but was just one of the primary concerns for employers.
Nearly a quarter of respondents reported a decline in their work productivity over the past two years due to financial worries, marking an increase from 18% the previous study.
Notably, younger age groups were more susceptible to presenteeism due to financial worries, with 28% of respondents aged 16 to 44 experiencing such issues, compared to just 15% of those aged over 45.
Financial worries intensifying absenteeism
“Since the publication of the previous report in 2021 consumers have faced the cost-of-living crisis, resulting in a decline in living standards as price growth outstripped growth in earnings,” Aegon said.
“These factors have exacerbated existing financial concerns, subsequently intensifying absenteeism and presenteeism issues among the workforce.”
Nick Roy, director of client and partnership development, at Aegon UK said: “Our research uncovers the scale of the impact that financial worries of workers are having on UK businesses.
“A staggering 16 million workdays lost due in part to soaring numbers of staff experiencing financial concerns should set alarm bells ringing.
“The combination of absenteeism and presenteeism stemming from financial instability comes in at a massive £10.3bn annual cost on private-sector businesses annually.
“The report shows that absenteeism and presenteeism are more prevalent in the younger age groups. This perhaps points to a financial resilience of workers already in their ‘second 50’ ‘which is encouraging.
“But they too are not immune to financial wellbeing challenges as they reach uncharted territory in their journey towards retirement.”