Financial stress is rising among American workers, says Morgan Stanley

With continued economic uncertainty weakening sentiment among both consumers and businesses, financial stress levels are intensifying.

And according to Morgan Stanley’s latest work study, concerns about money are negatively impacting both work and life for most employees; 66% said so, up four percentage points compared to 2024.

This is having an effect on businesses, with 83% of HR professionals surveyed saying that the state of employees’ financial wellbeing is causing productivity concerns. Michael Estep, president of group insurance at Prudential Financial, recently joined InvestmentNews anchor Gregg Greenberg to highlight the role benefits play in an employee's productivity and overall well-being.

Morgan Stanley at Work’s research highlights that employees are increasingly asking for more help from employers with financial matters with 84% of employees saying their employers should more actively assist in this regard, with younger workers most likely to say this.

“We stand at a unique inflection point, as significant shifts in the wider economy create a ripple effect in HR and employee attitudes around their approach to workplace financial benefits,” said Scott Whatley, Head of Morgan Stanley at Work. “As we navigate a volatile economic landscape and fluctuating employee expectations, our latest study underscores the power of financial benefits packages to align business goals with employee needs—ultimately enhancing overall workplace satisfaction, productivity and stability.”

Eight in ten workers say they need to step up their financial planning efforts and 90% believe workplace benefits are essential to help them achieve their financial goals, especially regarding retirement preparation, financial planning and maximizing equity compensation.

But benefits are not only positive for employees. The HR execs who took part in the study said that helping employees with their financial goals is good for retention (the number one challenge cited by respondents) and both employers and employees agree that people are more likely to leave a job if benefits that help reduce financial stress are not offered. This also requires benefit availability to be adequately communicated to employees.

“Since the workplace is often the first entry point for many employees to build financial security, nailing the workplace benefits user experience and providing effective education remains key—not just for the employee, but for the company,” said Kate Winget, Chief Revenue Officer of Morgan Stanley at Work. “This research shows a direct tie between workplace financial benefits and employee retention, driving home the insight that even amid economic uncertainty, the financial outcomes of companies and their employees are inextricably linked. Financial benefits are a pathway forward.”