UK staff get little help from bosses for £6 billion Christmas overspend

A majority of UK employees find financial worries to be a distraction from daily activities over the Christmas period, a new study has found. Almost three quarters of cash-strapped staff will receive no support from their employers during the festive period, meanwhile, impacting on productivity rates as they struggle to maintain motivation in the holiday season.

It’s the most wonderful time of the year, or so the songs go. The grim reality, however, is that the season sees people put under sustained financial stress, as employees who likely have seen their pay stagnate for the past decade are expected to commit to gorging themselves and their families on blow-out meals, burying their winter blues under a stack of expensive gadgets.

With the consumption-led economy of the UK is close to flat-lining amid poor sales figures and widespread closures in the retail sector, this has placed an added emphasis on the importance of December trade, meaning companies have ramped up added pressure on consumers to spend beyond their means, in the spirit of the season. As a result, employee engagement platform Reward Gateway estimates that Brits will collectively overspend at Christmas by an estimated £5.95 billion. No wonder, then, that 53% of employees told the firm in a recent survey that financial worries distract them.

The research, undertaken by Censuswide in December 2018, found that despite these concerns, fewer than 17% of the 1,000 adults polled across Britain were sure they would receive support from their bosses when it came to their financial burden this Christmas. A worrying 12.8%, meanwhile, were left facing uncertainty regarding the level of support their employers might offer, and an alarming 71% said their miserly paymasters would do nothing to help.

Instead, Reward Gateway found that a large number of respondents were turning to other means of financing their holiday celebrations. Of those who face monetary short-falls, 40% said they would dip into their long-term savings to pay for Christmas, while a worrying 53% said they would either use credit cards or overdrafts to finance their overspending. 10% suggested that family borrowing was also an option.

From the data released by Reward Gateway, it seems that those with families are – unsurprisingly – hit hardest by festive overspending. Almost 2 in 5 (37%) respondents aged 35-44 have used credit cards to cover the cost of Christmas in the past, compared to under a fifth (19%) of respondents aged 16-24.

Generally, the middle-aged respondents are those likely to have the largest, oldest families, with the possibility of multiple children reaching the maturity to ask for more expensive gifts, while needing to invest in larger amounts of food to feast on over December. Respondents aged 45-54 overspend the most at Christmas, by £226 on average; however, they are more likely to have reached senior levels in their careers than those between 35-44, so can typically pay this off quicker.

Productivity crisis

To that end, the overspend takes its toll on consumers' wallets for some time following the Christmas period. In the best case scenarios of respondents aged 16-24 and those over 55, it takes just over 2 months to pay off the costs of Christmas, while the higher average spending of respondents aged 35-44 takes almost 4 months – well above the total average of  2.86 months. While employers might be tempted to think this is not their problem, as indicated by the low level of support typically offered for festive spending, this lengthy pay-back period is also a major issue for them.

With the UK facing a major productivity crisis heading into a very Brexit 2019, 38.5% of respondents said they will find it hard to remain motivated while they struggle to reconcile their finances in the New Year. This could see more than a third of the workforce reserving their energies for other matters, in what will undoubtedly prove to be a make-or-break first quarter for many companies across the industrial spectrum.

Commenting on the findings, Rob Boland, Group Director of Product & Client Success at Reward Gateway, said, “It’s no surprise that financial worries are a prominent distraction at work, but what is a surprise is how few companies offer financial wellbeing support to their employees. There are simple, cost-effective ways to help your employees with their financial wellbeing from getting an advisor in for the day for one-to-one sessions, to offering salary deduction and salary sacrifice schemes to allow workers to spread out the costs of expensive items such as white goods or travel.”

Related: 85% of UK bosses will spread festive cheer with Christmas party.