Even though the economists tell us inflation is cooling, American workers are still navigating a challenging economy. The cost of living—housing, healthcare, and food—has skyrocketed. While millions of Americans are living paycheck to paycheck, with one in four without any emergency savings at all, the danger of falling into the seemingly never-ending cycle of debt is a frightening and realistic proposition. For many of them, one unexpected expense—whether it’s a medical bill, car repair, or an unusually high utility bill—can throw their finances a few steps behind.
A poll from Fidelity reveals that nearly two-thirds (65%) are considering a financial resolution for the year ahead. For HR Professionals, this is an opportunity to help make those resolutions come true. HR Professionals can seize the moment of a new offer financial wellness benefits that can make an immediate positive impact on their lives. Benefits that speak to their resolution often entail living a more responsible financial life.
And that’s where earned wage access comes into play.
Employer-sponsored earned wage access is a financial wellness benefit that allows employees to access their earned but unpaid wages before their regular payday. This voluntary program empowers workers to take greater control over their finances.
One concern an HR professional might have is the danger of an employee potentially misusing the benefit. However, the numbers show the opposite. For example, usage data from DailyPay shows that the top 3 reasons employees use their service are to pay bills, buy groceries, and buy gas.
Responsible usage is critical to ensuring that earned wage access benefits employees in the long term.Research shows EWA users can avoid high-interest credit cards, predatory loans, and overdraft fees by using the financial wellness benefit, setting themselves up for financial success and stability. As a proof point relating to responsible usage, DailyPay actually sees employee usage drop off over time because they begin to build a safety net for themselves as they break out of a debt cycle. Earned wage access emerges as a valuable tool that employees leverage on their path to financial stability.
So what happens when your employees live paycheck to paycheck without a safety net? Financial stress doesn’t stay at home—it comes to work with them. Studies show that workers under financial strain are more likely to experience lower productivity, increased absenteeism, and decreased job satisfaction. When your employees are stressed about how they’ll make it to their next payday, it impacts their focus, engagement, and well-being.
But when HR professionals offer an earned wage access platform – you’re providing more than just a benefit. You’re helping to alleviate that financial stress, giving your employees the flexibility they need to navigate their financial lives. In turn, they’re more focused, more engaged, and more satisfied in their roles. And that’s a resolution we can all support.
Chief Customer Officer DailyPay
