Financial stress is skyrocketing among Australian workers on the back of the coronavirus pandemic, with women facing the brunt of it.
AMP’s 2020 Financial Wellness research has found severe and moderate levels of financial stress are impacting 1.8 million Australian workers, with women significantly more impacted than men.
In total, 50 per cent of all Australian workers reported some level of stress about their finances.
The research, which AMP has conducted twice a year since 2014, found that approximately one in five female employees have reported severe or moderate levels of financial stress, compared to 11 per cent of male employees.
Younger women are particularly at risk, with 23 per cent of those aged 18 to 34 reporting severe or moderate levels of financial stress this year - almost three times the number of male employees (eight per cent) in the same age group.
The report found the hospitality industry is experiencing the highest levels of financial stress, followed by retail.
South Australia is the hardest-hit state, with 26 per cent of its workers recording significant stress levels, followed by the Northern Territory at 23 per cent.
COVID-related stress led to an extra seven sick days on average per year, compared to three in 2018, the research found.
It’s not just low-income earners who are impacted. One in ten Australians earning $100,000 or more recorded experiencing severe or moderate financial anxiety.
Valerie Foley, a TV post-producer, told SBS News that living in Sydney and being a single parent to a child with disabilities has contributed to financial stress, despite her earning a six-figure income.
“While I’m working, I need to pay for care for my child. I earn a decent living, but Sydney is a really expensive town and disability care is really expensive as well,” she said.
The 52-year-old said she feels like “one of the lucky ones”, noting she didn’t lose her job or home during the COVID-19 crisis, but says a lack of financial literacy skills can make it more difficult to get by.
Valerie says the pandemic has contributed to her financial stress. Source: SBS News
“I try to keep a month’s rent in the bank in case something happens. But apart from that, I have zero financial literacy skills," she said.
“I did draw down on super because our pay was cut through the pandemic, and I used that to move house to be closer to where I’m working.”
Mimi Liu is a coordinator at The Smith Family's SaverPlus program, which provides free financial literacy education and $500 in matched savings.
After becoming a single mother in 2000, she said she knows what it feels like to suffer financial difficulty.
Ms Liu said it's "not a surprise" that females are worse impacted by financial stress than men. "During the COVID-19 pandemic, there were a lot of cases. It happened to my participants," she told SBS News.
"I’m a single mum - I sign up a lot of single mums. Financially, they need to survive - not only relying on Centrelink payments. They work part time when the kids are in school, and it’s not easy to survive."
AMP Director of Workplace Super Ilaine Anderson, who has helped study the impacts of financial stress for six years, said it's a "systemic issue in Australian society" that goes beyond the pandemic.
Mimi said it wasn't surprising that women were worse-affected by financial stress. Source: SBS News
She stressed that education is crucial to allowing people to overcome the issue, and said employers have an important role to play in offering more financial literacy programs.
“We know those who feel in control of their money are measurably less stressed, happier and more productive in the workplace. We also know that well-defined personal and family goals, and a plan in place to achieve them, can provide comfort," Ms Anderson said.
“But employees also require the knowledge and know how to achieve their goals. And while more employees today than in previous years claim to have good financial intentions, they still often lack the tools, support, information and opportunity to take action.
"Access to financial education is essential."
With additional reporting by Gavin Fernando.
