How tracking pay can improve employee financial wellbeing.
One in five Australian employees today is a casual worker and don’t work the same number of hours each week. One in four Australian employees have earnings that vary from pay cheque to pay cheque.
Not knowing how much they’re going to get paid on payday makes it difficult for casual employees to budget and plan ahead. It can be hard to understand how your earnings compare each month and to make quick money decisions.
Pay tracking is a way for shift and casual workers to better predict how much they’ll get on payday.
With apps like Wagestream, employees can track their earnings in real-time, compare their earnings month on month and see exactly where they are up to in the pay cycle, as well as get an estimate of their average monthly pay to help with budgeting.
Research from EY has found that 70% of workers experience financial stress regularly and for half of those, it’s because they fall short on expenses between pay periods. Being able to track pay and compare earnings from this month to previous months can also help workers predict shortfalls.
Financial stress is felt by employees across all industries, income levels and roles, but the highest levels are reported by those working in accommodation and food services, healthcare and social assistance, most of which are shift workers. This stress is estimated to cost Aussie businesses $31.1bn a year.
Seeing earnings at a glance can take the mental load out of having to manually calculate average earnings and how earnings compare to previous months.
It can save time, money and hassles, which is particularly important for financially stressed employees who are found to spend 46 hours dealing with their finances and work and who take an average of 2.4 more sick days a year.
Research from behavioural science finds that people make decisions based on reference points and ‘anchor’ to these reference points when making decisions. For example, when you go to a restaurant, the price of the most and least expensive bottles of wine become reference points as you choose.
Similarly, people make different spending decisions based on how their earnings are presented to them.
Research has found that people save more when shown their projected superannuation as an annual amount, compared to as a lump sum, for example. Helping people understand their daily earnings can give them a more tangible reference point to help them make daily spending decisions.
When employees know how much they’re earning and compare these with previous pay cycles, they’re able to see if they’ll fall short and need to pick up an extra shift.
With access to earned wages during overtime, customers in the security industry have seen 90% more shifts filled. Seven in 10 track their pay each week and 57% feel less stressed about their finances.
Pay tracking is the reason why seven in 10 employees use the Wagestream app. One user helps explain why:
“I’m the type of person who likes to budget and seeing my average pay helps me to know how much I can spend on bills and other important things. It’s rewarding to see that I was able to earn that much in a month … it’s actually a self-esteem booster.”
Find out about Track in the Wagestream app today.