Financial strains - Employees are sick with worry

It may not surprise anyone who has experienced the cold wind of Ireland’s austerity regime that 91% of employees are stressed over the state of their finances and worry constantly about how to get by.

But what might be less well-known is that the psychological ailments associated with trying to make ends meet are costing Irish businesses a staggering €2.1bn every year.

A study published today shows that absenteeism by financially stressed employees costs business €850,000 a day and 78% of managers feel financial stress costs them productivity.

In fact, at any given moment, 557 people are off work ill due to financial stress and the average employee loses 37 minutes a day worrying about their personal finances.

The survey, conducted by Amárach Research and commissioned by the MyMoney website, also reveals that 68% of employees have debt that threatens to overwhelm them, with almost the same percentage having everyday expenses that exceed their income.

More than 40% of those surveyed admitted that they are not in control of their finances, with 67% unable to plan ahead or save for emergencies.

This is a horrifying scenario and should inform the Government — and, in particular, Finance Minister Michael Noonan — when deciding the final shape of next month’s budget.

While he may seek to argue the toss with our bailout masters, the minister should never lose sight of the fact that fighting to save a few hundred million euro in cuts and extra taxes may be a moot point to those already experiencing extreme financial hardship.

Behind every grim statistic is an even grimmer reality: cutbacks hurt all but the very wealthy; higher taxation hurts even more, and inevitably leads to businesses going bust and hundreds of thousands losing their jobs.

Recognising and appreciating that reality may be even more important than ever as so-called ‘green shoots’ have begun to appear in our ailing economy.

Signs of that hope emerged yesterday when the Irish League of Credit Unions published the second of its ‘What’s Left’ tracker of 2013 and it showed continued signs of disposable incomes stabilising.

This month, disposable income for the average adult has increased by 6% to €172, from €163 a month in May. Disposable income for the average working adult has increased by 9% from €188 in May to €205 this month.

That’s the good news. However, coming into the winter months, when we traditionally see an increase in household utility bills, it is doubtful that this trend will continue.

Recovery brings hope, but that hope is extremely fragile and can be easily dashed by an overemphasis on balancing the books in the budget.

Whatever the final figure, taking the bones of €3bn more out of the economy is bound to affect businesses that are already reeling to the tune of €2.1bn in lost production due to illness.

It doesn’t make sense, minister. Do the math, as they say in America. In fact, perhaps, you don’t have to. Just think of the people affected by your decisions and do the right thing.