By DAVID BROWN
THE UK economy is struggling with a cost-of-living crisis putting pressure on millions of households.
The change of leadership with the appointment of Liz Truss as prime minister and Kwasi Kwarteng as Chancellor of the Exchequer has raised discussion on how the economy can be kickstarted.
An area which has been highlighted is the UK’s low productivity levels, important to prosperity, improving living standards, boosting growth, and taming inflation.
The UK experienced no productivity growth between the first and second quarters of this year. Figures released by the Office for National Statistics (ONS) show that between the first three-month period in 2022 and the second, productivity in the UK stagnated.
While output per hour worked in the second quarter was 1.7 percent higher than pre-coronavirus pandemic levels, output per worker fell by 0.6 percent — indicating that more people entered the workforce.
Why are employees less productive? One factor which shouldn’t be overlooked is financial wellbeing. UK companies can improve their own productivity levels and support their workers by enhancing financial wellbeing via frequent and flexible pay: enabling workers to access their earned income before payday.
A study took evidence from 2,200 employees and found 71 percent of professionals are experiencing moderate to high levels of stress. The survey shows the cost-of-living crisis is causing those who experience financial stress to feel fatigued. Almost half (48 percent) of those experiencing financial stress report poor sleep quality, and 47 percent say this is leading to anxiety.
This backs up previous findings by Close Brothers in the 2019 Financial Wellbeing Index which highlights that 94 percent of employees worry about money, and 77 percent say this affects their work. In Australia, an Impact Economics and Policy report found that lost productivity due to poor mental health in New South Wales could amount to $7.5bn.
