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Millennials’ Lack of Financial Literacy Costs Employers Too

Previously (in 9 Workplace Trends Worth Knowing,) Ira Wolfe wrote about the troubling statistic between recent graduates (Millennials) and their preparedness for professional environments. Specifically it was stated that four out of five CEOs worry about the availability of key skills, and that only 45 percent of young people believe they’re prepared to enter the workforce.

Millennial financial literacyFor the most part, these pieces of data are referring directly to young people’s often inadequate preparation for jobs and career growth, and this is something that CEOs and senior employees can help with to some extent. That is to say, programs can be implemented and Millennials can be coached so that they may catch up and succeed in their careers. However, the idea that young people aren’t always ready for the workforce doesn’t solely concern performance in the office. The same problem exists on a more personal level for many young employees in that many simply aren’t ready for the financial management that comes with securing a job and salary.

If that doesn’t sound like a problem that could negatively impact a workplace, think again. According to a 2012 survey conducted by Fidelity Investments, 78 percent of employers say “concerns over financial problems can have a negative impact on employee productivity.” That statistic comes on the heels of a number of troubling findings about the financial literacy of American employees in general, though it’s only natural that the problems are more concerning with younger employees.

So how can small business owners and managers help ensure a young employee’s financial future instead of unfortunate fate?

Well, the best solution may be to set up some sort of course or training to educate employees on the basic financial skill sets and understanding they’ll need to succeed. Here are a few ideas that can make for a good start.

  • Confirm the advantages of savings vs. paying off debts. One of the biggest challenges facing Millennials entering the job market these days is the mountain of student loan debt so many are buried beneath. Debt can be a constant source of stress, and in ways it becomes even trickier to deal with once you have income, because a new problem arises: how much money should you save, and how much should you allocate for paying off debts? S. News & World Report provided a very helpful worksheet for addressing these questions. It’s a helpful resource for young professionals struggling with all this.
  • Discuss the very basics of investment. For the young and even many more mature employees, investment can be confusing and complex. It may be a difficult concept to understand and implement especially for many young people coming right out of college and joining the workforce for the first time,. Providing a basic guide to how the market works and how investments are conducted can make a world of difference to a young employee. FXCM offers an outline of the New York Stock Exchange’s history and functionality that can be a terrific starting point while serving as the foundation for more specific financial strategy.
  • Provide a simplified explanation of how employment will affect the employee financially. For young employees not used to filling out forms with information on everything from health insurance to retirement funds, the whole process can be a bit overwhelming. Also, the forms themselves sometimes seem almost as if they’re designed to confuse. The fine print is necessary, but to help any employee – regardless of age – fully grasp and embrace financial commitments and benefits associated with a new job, providing a simplified explanation can be extraordinarily helpful. This allows the employee to understand where he or she stands with income and investment, so as to better address personal financial decisions.

In the end, a small business owner or CEO can only go so far in helping new and young employees to become more financially literate. Unfortunately, though, it’s a reality in much of America that Millennials are often unprepared not just for the workforce but for their own financial planning. Helping them to get off on the right foot in this regard can go a long way toward improving productivity and promoting ease of mind in the workplace.

Special thanks to Jenna Batten, a freelance writer based just outside of Baltimore, for submitting this post. She enjoys covering topics related to financial management and investing.

4 Types of Workaholics: Which One Are You?

How many people do you know who are afflicted with workaholism?  Our research has recognized 4 types.  You might even recognized yourself in one of the types.

First, let’s sort out a little confusion. Often times employee engagement is confused with workaholism. While many of you may work hard and be engaged, others might be busting your butt…and disengaged.

multitasking workaholicMichael Haberman in a recent post nailed it when he wrote “being a workaholic is not the same as being engaged.”

Engagement is positive. Despite the hard work, long hours, and sacrifice, some people truly love their work. In a quote attributed to Confucious, “Choose a job you love, and you will never have to work a day in your life.” That’s engagement.

Workaholism, on the other hand, is negative, according to University of Georgia professor Lindsay Lavine.

According to Clark and her team, workaholism is like an addiction. Like the addict, workaholics experience the initial “high” but quickly get overwhelmed, stressed, and irritated. Work isn’t fun but something they must do. They can’t stop thinking about it. They become obsessed. They work more and work harder to get another high.

For the workaholic, self-esteem is intertwined with work. If not working hard and/or not getting acknowledgement for all his sacrifice, his ego is hurt. Work isn’t a means to an end – it is the end figuratively and literally.

Workaholics defend their addiction like alcoholics defend their drinking. They make excuses. Beyond the stereotypical denial, they downplay and deny the problem. They rationalize by blaming others for the workload. “What does it matter? I’m not hurting anyone but myself,” they say. “I can stop anytime I want,” they tell themselves.

Companies, management, and even society even encourage and reward workaholism. Workaholics are applauded and put on a pedestal for their dedication, commitment, and loyalty just like the alcoholic is “admired” for the amount of alcohol he can consume and still appear sober.  Rewarding workaholism is like designating the alcoholic as your driver because he’s the most sober in the group. No matter how much he contests or you rationalize, he’s still impaired.

Ultimately workaholism takes a personal toll. The associated negativity and stress doesn’t stop at the office because even when the workaholic isn’t at work, he’s thinking about it. From broken marriages to stress-related illness addiction to work carries a heavy price. Divorce, family conflict, and poor health (both mental and physical) are all possible consequences of workaholism.

Employers might ignore these personal issues if the problems don’t just stop there.  But workaholics make more mistakes. They are involved in more accidents. Their workaholism becomes their badge of courage. It becomes synonymous with self-esteem. Decisions they make are made to protect pride or build ego, not for the good of the team and company. Many workaholics are sleep deprived.  Others are so stressed and burned out that clarity is long gone.

A propensity for workaholism can be uncovered using the Quality of Motivation Questionnaire. It’s important for individuals and organizations to recognize workaholism and help those “afflicted” to it.  Managers need to encourage engagement and not contribute to workaholism. The consequences and implications can be devastating to the employee and the company.

Here are four types of workaholics we have identified:

1. Defeatism. The defeatist denies himself pleasure. This is one of the strongest drivers of workaholism. Excuses abound for the defeatist in action:

“I don’t have the time.”

“I don’t deserve it.”

“The work will just pile up if I took any time off.”

The defeatist gets his fix through personal sacrifice. He’s the one who works late and misses his children’s game and school play so a co-worker can go golfing or get a manicure. He’s the one that gives up his favorite lunch because a co-worker forgot hers. The “thank you” initiates a warm feeling – it’s the quick fix. Unfortunately the guilt sets in soon after he realizes he missed again something he might enjoy.

2. Sabotage. The saboteur loses things he values… or at least used to value. Carelessness marks the workaholic afflicted with self-sabotage because he’s distracted and obsessed with work. He might neglect his health – no time to waste at a doctor’s office. He forgets his wife’s birthday and cancels an anniversary dinner because his boss asked him to finish a project. He misplaces a “thumb drive” that has all of his presentations on it but didn’t take time to back it up.

3. Punishment. This is the one of the most common causes of workaholism. “Nothing comes easy” and “no-pain-no-gain” have become the battle cry of the American work ethic. Now I’ll be the first to admit that effort and sacrifice are essential ingredients for success.  In fact, some degree of self- punishment is required to build pride.  It’s a given that we gain confidence when we push ourselves beyond our comfort zone and achieve something we didn’t think we could do. But when hard work becomes addiction to work, we begin to take more and more risks. We build a tolerance and then have something more to prove. If something isn’t working out despite all our effort and hard work, it must be because we aren’t working hard enough!  Punishment once engaged becomes a self-sustaining negative behavior. We ignore warning signs and endure unhealthy levels of pain and stress. We become overconfident in our ability to recognize our limits. Courage leads to fearlessness and then to recklessness. The punisher starts by injuring only himself but over time begins to put others at risk too.

4. Martyrdom. Misery loves company personifies this behavior. This is the “woe is me” source of workaholism. It stems from a sense of hopelessness and futility.  Even when opportunities to lessen the workload or get relief present themselves, the martyr declines the help.  “What difference will it make?” he thinks.  “You just can’t find good help today” brings a chorus of agreement which is exactly the response that gives him the “jolt” to keep going.  At least he feels that someone understands him.  Martyrs don’t really want to stop working so hard. They want others to feel pity and agree that life’s a bitch.

Perhaps you recognize yourself in some of the examples.  What steps should you be taking on the road to recovery?

Success – however you define it – doesn’t mean you have to sacrifice everything. Work-life balance doesn’t work either. It forces you to think about work and life as a tradeoff.  If you think about work or life, you will always think in terms of what you have to give up.

The most successful people in life are those who figure out how to integrate work-and-life. How well are you doing? How successful are you at integrating work and life?

Job Creep Creates Overworked, Fatigued Workers

An unpredictable economy and persistent pressure on the bottom line has pushed employers to demand workers to do more with less…and often for less. Many companies are running lean and mean. Many support and collateral jobs have been eliminated. Others simply go unfilled. That means an employee may have absorbed responsibilities into their job that managers don’t even recognize. This insidious workplace phenomenon is something called job creep, a growing problem for both employers and employees.

There are 2 primary reasons why employees work long hours:

  1. Slow or no hiring. It should come as no surprise that many businesses are reluctant to hire.  Even when actively recruiting, companies are being very diligent in screening and selecting candidates. When positions remain vacant, incumbent workers are expected to pick up the slack.
  2. Padding retirement funds. The recession has not been kind to paychecks and pension plans.  Many workers want to work overtime to boost their retirement benefits, especially if payouts are based on their last two or three highest-producing years.

Job creep is not always voluntary. Some worker feel pressure to assume more responsibility or extra work shifts because of early retirements, layoffs, injuries, vacancies or vacations in their departments. Overworked employees don’t always work very well. Several studies also show that job performance falls precipitously after 10 consecutive hours on the job.

How prevalent is job creep? According to a recent Spherion Staffing survey, more than half of all employees have taken on new roles during the eco­nomic downturn.

More specifically, The Washington Post recently published a report about overworked and fatigued Metrorail workers. In two cases, an employee in the heavy equipment department worked 112 hours in one week — or 16-hour shifts for seven days in a row, according to the study. One manager in the track and structure division said his crew had worked the “last 22 weekends in a row.”

The same Spherion survey found that only 7% of employees received additional pay in return for expanded duties. Regardless of the cause, productivity often suffers which can cause employees to burn out or become dissatisfied with their jobs. Job creep can lead to fatigue, accidents, and mistakes.

This creep of job responsibility is not limited to the employee’s company. You might call this scenario passing the buck. When everyone cuts back, someone still has to the work. A growing problem is that suppliers, vendors, and client organizations have shrunk and your employee(s) may be assuming responsibilities for tasks formerly handled by another business in the supply chain.

Fatigue and mistakes are just the beginning of job creep problems for employees.  Job creep probably means many job ­descriptions are probably outdated. Peter Drucker once observed that the key to effective management is doing a number of simple things well. One of those simple things is having clear expectations. With job creep, the usual job description becomes an obsolete and cryptic outline of a position that perhaps once existed. How can an employee be coached and evaluated effectively without crystal clear expectations and responsibilities? And with an outdated description, holding an under-performing worker accountable could be trouble, particularly if disciplinary action or termination is necessary.

Even more threatening are important employment law implications, including potential effects on FMLA leave, ADA accommodations and Fair Labor Standards Act (FLSA) compliance.

Several federal laws rely on up-to-date, accurate job descriptions. Most notably, the ADA requires employers to specifically designate which job functions are essential and which are not. Job creep might force an employee to perform functions despite a serious health condition. Without a job description, employees may simply provide medical documentation exempting them from many of the new duties they have been assigned.

Additionally, the FLSA requires paying overtime to employees who are not exempt under the law. Shuffled job responsibilities may make employees who were previously exempt under the FLSA eligible for overtime. Don’t assume that adding non-management tasks to a manager’s plate won’t affect the manager’s exemption.

Think of job creep as another bubble, as real as the housing and tech bubbles. It is imperative that employee workloads be reviewed to determine if some workers are being asked to do more than is reasonable. Look for dips in productivity that coincides with increased job duties. Look at ways to spread the additional responsibilities over several workers. Examine ways of automating functions to make tasks less demanding.

If not, when the job creep bubble bursts, businesses may see a mass exodus of skilled workers out the door. At that point, any labor costs squeezed out of employees will evaporate and the genius of current management will seem really dumb.

12 Stats and Facts – Time Wasted @Work Adds Up

1.  Average hours American worker actually wastes – 2.09 hours per day

2.  Top 5 Time-Wasting Excuses (%)

  • Don’t have enough work to do 33.2%
  • Underpaid for amount of work 23.4%
  • Co-workers distract me 14.7%
  • Not enough after-work time 12.0%
  • Other 16.7%

3.  Average hours American workers are expected to waste by HR – .94 hours per day

4.  Difference between expected and actual time wasted – 1.15 hours per day, 299 hours per year

5.  Average American worker’s annual salary $19.13 per hour, $153.04 per day, $39,795 per year

6.  Total salary dollars wasted per employee – $5,720 per year

7.  Total number of American workers (non-farm) – 132 million per year

8.  Total salary cost to companies – $759 billion per year

9.  Year of Birth Time Wasted Per Day:

  • 1930-1949 0.50 hours
  • 1950-1959 0.68 hours
  • 1960-1969 1.19 hours
  • 1970-1979 1.61 hours
  • 1980-1985 1.95 hours

10.  Top 10 Time Wasting Industries (per day)

  • Insurance 2.5 hours
  • Public Sector (Non-Education) 2.4 hours
  • Research & Development 2.3 hours
  • Education 2.2 hours
  • Software and Internet 2.2 hours

11.  Top 5 Time Wasting States

State – Time Wasted (hours/day) – Salary Dollars Wasted (per year)

  • Missouri – 3.2 hours – $28.1 billion
  • Indiana – 2.8 hours – $25.1 billion
  • Kentucky – 2.8 hours – $15.4 billion
  • Wisconsin – 2.8 hours – $23.8 billion
  • Nevada – 2.7 hours – $9.8 billion

12.   There are 11 million formal meetings per day in the United States. That’s over 3 billion meetings per year. 71% of the attendees feel the meetings aren’t productive. Source:,, Davidson Staffing,