After two years of existential crises – the pandemic, a war in Europe, and historic inflation – employees are more focused on their financial security and well-being than climbing the ladder or career advancement, according to Mercer’s 2022 Inside Employees’ Minds study. The number of employees who are considering leaving their employer has increased to 36% compared to 28% in 2021, with low-income (those who make less than $60k per year), frontline (healthcare, retail, hospitality, etc.), and underrepresented employees being more likely to consider leaving than other groups. The findings also show significant declines in employee satisfaction and commitment across the board, most noticeably in compensation, benefits, and career goals.
The survey was designed to explore the root causes of high turnover and how employees’ needs and wants have shifted over the past year since the term “Great Resignation” was coined in May 2021. During the pandemic, organizations that led with empathy and prioritized health and flexibility were rewarded with high levels of employee commitment, engagement, and productivity. But with the new challenges of 2022, employees are prioritizing their well-being. The top three reasons employees consider leaving their employer are pay and benefits, burnout due to workload, and insufficient healthcare benefits. For some, especially front-line and low-income employees, that means financial survival. Others, who have their basic financial needs met, are placing increased importance on their lives outside of work.
Ability to meet monthly expenses jumps to #1 employee concern
The findings reveal that concerns over inflation have placed financial health as the greatest of employees’ unmet needs – defined as concerns that keep employees up at night and prevent them from having adequate mental and emotional bandwidth to do a great job at work. Covering monthly expenses now claims the top spot, up from #9 in 2021, and the ability to retire is now second, up from #5 in 2021.
Third on the list is work-life balance and boundaries – employees continue to say burnout is a key reason for them to consider leaving their employer. About half (51%) of employees reported feeling exhausted on a typical day at work. This was of the highest concern to front-line workforces, such as those working in healthcare, retail, food service, and hospitality. Concerns about physical health have declined this year as health and safety measures at work and the threat posed by COVID-19 have improved, though it still remains a top concern overall (#4, down from the #1 spot last year). Mental health concerns are also in the top five.
Employees are increasingly concerned about healthcare affordability
Employees’ financial concerns are not just causing stress – they are changing behavior. Overall, nearly 2 out of 3 employees (62%) say they’ve reduced spending, and a third say they’ve reduced savings or tapped into savings to supplement their spending needs. Low-income employees are the most vulnerable to inflation, as pay levels often fall below living expenses. Nearly 1 in 3 employees making less than $60k per year say they’ve taken on additional work to supplement their income.
The fact that so many people are cutting spending to cover their monthly expenses is especially concerning when it comes to healthcare. Over two-thirds of employees say they face some type of challenge in getting the healthcare they need, with the top challenge being trouble affording the healthcare costs that aren’t covered by health insurance plans, such as deductibles and co-pays.
Employers are well aware of healthcare affordability issues: our most recent employer survey found that most are avoiding shifting health plan costs to employees in 2023 despite rising healthcare costs. Offering generous healthcare benefits is also important in recruiting and retaining workers: employees report that behind pay and workload, insufficient healthcare benefits are the next top reasons they would consider leaving their employer.
Mental health is a top 2 concern for younger workers and other employee groups
Mercer’s employer surveys have shown that employers are concerned about their workers’ mental health after three years in a pandemic, and with their ability to access mental health care. These new findings, from the employees’ perspective, show they are right to focus on this issue. While mental health ranked fifth among concerns overall, it is a top 2 concern for workers under age 35, female caregivers, and LBGTQ employees, and a top 3 concern for Black, Hispanic and Latino workers and women in general.
The survey asked employees what their employers could do to help support their mental health and ease burnout. At the top of the list is reducing their workload – not surprising given that many employers have been running short-staffed and leaning on their people to cover these gaps. Of particular interest to health benefit professionals is that employees ranked “enhanced employee assistance program” as #2, and “access to mental health apps” as #3. It’s easy to see the appeal of EAPs – they are a known resource that’s easy to access for free or low-cost mental health support. For Black workers, enhanced EAP services were ranked #1.
Employers must adjust to changing needs
In 2022, employees value a workplace that centers on well-being; where they have more sustainable workloads and more resources to support their holistic health – financial, physical, and mental. Employers who act to address these evolving needs will gain a committed and productive workforce and be an employer of choice in today’s job market.
About Inside Employees’ Minds: This study includes 4,049 full-time employees in the United States, working for organizations with more than 250 employees. The study was conducted between August 26 and September 9, 2022. The report also includes actionable advice for employers to help address unmet needs in their workforce.
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