The United Arab Emirates (UAE) is home to an array of workers — forward thinkers, innovators, and future world leaders amongst them. Yet this fast-growing country is also home to some of the worst savers and budgeters, especially given the growing hyper-consumerism issues we face.

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The result is an increase in financial stress, which inevitably impacts employee engagement and wellbeing in the workplace. As we know, a lack of employee wellbeing leads to greater employee retention rates, poor productivity, and unhappy employees. But how exactly should HR professionals and companies address this?

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While traditional workshops and presentations may create some difference, they do very little to generate sustainable change that addresses the root issue. Simply put, education isn’t enough.

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The solution? A more dynamic approach through workplace savings benefits, and more specifically, savings schemes. Here’s why.

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Why Employee Engagement Matters

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Employee engagement is a measure of how well individuals are engaged cognitively, emotionally, and behaviorally within the workplace. More engaged employees tend to have a more positive perspective of their work environment, and thus produce higher-quality work.

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Higher quality work leads to a greater output, which in turn generates more for the company as a whole. So, it’s important to engage employees in a meaningful manner to keep companies efficient, profitable spaces.

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The Impact of Financial Wellbeing on Employee Engagement

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A recent study from Mercer found that, on average, people in the UAE spend 13 hours per month worrying about money matters at work. Given that standard full-time employees spend 80 hours a month at work, we can assume that around 16.25% of their hours are spent not fully engaged.

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Likewise, millennials in the UAE specifically say they're burnt out by the financial stress of being an adult. Burnout leads to increased employee absence, lower employee productivity, disengagement, and overall poor employee wellness.

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The Cost of Financially Unwell Employees

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The lack of employee engagement costs employers around 5% of payroll, on average.

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It likely isn’t a surprise that disengaged employees also contribute to high turnover rates, higher absenteeism rates, workplace dissatisfaction, and lower productivity. While challenging to measure the material cost of each of these issues, it’s fair to say that each one reduces overall engagement, which inevitably decreases output and impacts the overall company profitability.

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Given the cost of talent acquisition and retention (read about how forward-looking UAE companies are improving talent acquisition here), it’s crucial for businesses to keep employees happy.

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Financial and Workplace Wellbeing in the UAE

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To address the roots of employee disengagement, it’s crucial to understand what truly impacts your employees.

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In the UAE, we know the vast majority of stressors are rooted in employees’ finances. Given that 38% of UAE residents are financially illiterate, this is unfortunately unsurprising. As a result, nearly 68% have no formal savings. This is due, in part, to an increase in non-essential spending.

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This doesn’t bode well for employees who hope to retire. This makes financial wellbeing programs that much more important in the UAE especially.

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Traditional Financial Wellbeing Approaches Are Not Enough

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Typically, we might default to implementing employee financial wellness programs and issuing salary increases. However, statistics show that neither are bound to generate tangible results for your employees.

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Why Education Is Not Enough

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While traditional employee wellness programs might make some difference, employees won’t leave financially literate after a one-off session. Likewise, understanding what it means to save money doesn’t mean employees will. 

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Additionally, given that only 20-40% of employees participate in wellness programs, you likely aren’t going to get the message across to your entire team. This leaves many employees in the lurch with no tangible results.

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Why Salary Increases Are Not Enough

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A recent study surveyed UAE workers to measure their job satisfaction. Those who were satisfied with their jobs cited elements such as friendly colleagues, a challenging environment, and growth opportunities as reasons for their satisfaction. Financial reasons, such as their salary, were hardly mentioned.

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The researchers deduced that “salary alone is not enough to drive job satisfaction, emphasizing the need for businesses to build well-rounded workplaces.”

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A Solution That Works: Financial Wellbeing Benefits

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Unlike financial wellbeing programs, financial wellbeing benefits create long-term tangible results for your employees. It shows both prospective and current employees that the company values them as a complex individual with a variety of needs.

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When employees feel valued, they’re far more likely to be engaged.

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What Are Financial Wellbeing Benefits?

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Financial wellness benefits address employee financial health. This includes benefits such as pension planning, retirement savings plans, and financial planning.

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Why Financial Wellbeing Benefits Work

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When coming up with new employee benefit ideas, financial benefits should be at the core, especially in the UAE. By giving employees benefits that address major life concerns, you can reduce overall employee stress, which impacts their work performance.

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Given that financial stress is high in the UAE, such benefits can address root issues causing employee disengagement.

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The Best Financial Benefit: Savings Schemes

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We know that workers in the UAE aren’t experts when it comes to saving and retirement planning. What better way to address this than by instituting a savings scheme benefit, helping employees gain access to proper savings solutions.

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What is a Savings Scheme?

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Savings schemes allow employees to set aside money for savings goals like retirement. Sometimes, employers offer incentives to encourage employees to contribute more to their savings. These incentives may include matching a certain percentage of employee contributions or making small contributions here and there.

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Why Savings Schemes Work to Increase Employee Engagement

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Incentivizing employees to invest in their financial wellbeing motivates them to take saving seriously and set themselves up for a better financial future.

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One UAE business owner Purvit Munot, Founder and CEO of Sav Money, says “Money management is complicated, and savings ask for a lot of discipline. Most banking products do not engage young households in a way that could excite them. Savings need to be more rewarding.”

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Savings schemes excite employees, making it more rewarding to contribute. They also automate a level of financial discipline many workers might be unable to do on their own.

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In fact, in a Mercer study, the surveyed employees’ perspectives on savings schemes were compelling:

- 99% said improved savings benefits would have a positive impact on their relationship

- 81% said they would be less likely to leave their job

- 70% said they would feel more satisfied with their job

- 43% said they would feel more committed to their organization

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By addressing the deeper stressors of employees, we’re able to increase their overall engagement.

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The Future of Savings Schemes in the UAE

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Currently, there is no employer-focused solution to address savings issues in the UAE. With the looming regulatory changes in the end of service benefits and retirement space, it’s important to start thinking about how your company will provide stronger financial benefits.

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By being ahead of the curve, your company can become a leader in offering financial benefits, such as savings schemes, that improve employee satisfaction and engagement.

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How You Can Implement Workplace Savings Solutions

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Implementing new benefits programs can sometimes be tricky. In fact, the main reason employers don’t implement proper savings and pension benefits is because they’re often too complex to understand and there are questions about affordability.

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However, at Aurem, we’ve built a seamless process for onboarding employees, setting them up for financial success, and measuring the impact on your business. Plus, there are no onboarding fees for the employer.

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Our team will help you implement the software necessary to begin. Then, your employees can contribute directly from their salaries, bank transfer, or via the Aurem app after their account is linked. Reach out to us, and we are happy to help!

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Conclusion

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Employee financial wellbeing isn’t something that can be solved in the workplace by traditional workshops and presentations. Likewise, company swag and dress-down Fridays won’t solve the real issues employees carry to work with them each day.

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Instead, instituting a dynamic workplace savings solution that provides a strong employee savings plan is key. By starting with well-rounded employee wellness benefits, we can create spaces that ease financial stress and anxiety and lead to more engaged workspaces.