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Frontline worker financial health is suffering. What HR can do

June 18, 2025
in Human Resources
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Frontline worker financial health is suffering. What HR can do
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In 2023, the Federal Reserve released an alarming stat that has come to highlight a growing crisis being felt in American workplaces: More than one-third of Americans are unable to meet a $400 emergency expense without borrowing or selling.

That figure isn’t broken down by job type or level and could likely be much higher for frontline workers, who are particularly at risk for “financial fragility,” says Timothy Flacke, co-founder and CEO of Commonwealth, a nonprofit focused on supporting financially vulnerable people. Without intervention by HR and benefits professionals to improve frontline employees’ financial health, Flacke says, organizations stand to risk productivity, engagement and turnover.

Effectively moving the needle, he says, will require many organizations to undergo a fundamental mindset shift about employee benefits: away from the perception that they are a cost center to an appreciation that benefits can be “a key strategic part of helping organizations achieve their business objectives.”

Employee financial health has increasingly come into the HR and benefits spotlight in the last few years, partly because the pandemic inspired many employers to take a more holistic approach to employee wellness. Yet, the unique financial realities facing frontline workers still leave many falling through the cracks of traditional HR and benefits strategies, Flacke says.

Apart from largely having lower wages and less upward mobility than salaried employees, frontline workers face significant financial volatility. Wages are dependent upon whether their manager puts them on the schedule that week, if they lack access to PTO but had to take time off for an illness or caregiving, or if they get fewer hours by season, for instance.

“For salaried workers, it can be easy to lose track of the fact that hourly workers’ income can rise or fall every week or every pay period,” Flacke says. “Their income is not guaranteed in the way a salaried person’s is.”

Variable wages are a particular concern in today’s uncertain economy, adds Will Eadie, chief strategy officer at frontline solutions provider WorkJam. At the same time that higher grocery and goods prices are dragging down frontline workers’ financial health, employers may also be reducing frontliners’ hours as they navigate the turbulent economy.

“Frontline workers have a unique impact of being hit by both sides,” he says.

A challenging financial context

Meanwhile, rising rent and mortgage costs are leaving many Americans with lower-to-moderate incomes cash-strapped—particularly those with student debt. A recent report from Commonwealth found that 18% of Americans hold student loan debt—and face an average monthly payment of more than $500.

Frontline workers are more likely than others to have accrued student debt but not finished college, adds Sara Vipond, senior associate research consultant at Mercer.

“They’re carrying that burden of debt,” she says, “without the benefit of a degree and the higher income associated with that.”

Complicating the conversation is the ongoing uncertainty around student loan repayments, with the former Biden administration’s attempts to cancel some debt halted, and efforts now proposed to limit the number of repayment options for federal loans from six to two.

“It’s an incredibly dynamic space right now,” Vipond says, “that is adding to a lot of the stress” for frontline workers.

Why HR needs a broad, strategic view

Such stress about immediate financial concerns prevents many frontline workers from being able to strategize for their long-term financial health.

Recent data from Mercer found that 63% of hourly workers do not feel confident they can turn their retirement savings into a consistent stream of income—compared to 37% of salaried employees, which Vipond calls a “huge gap.”

Sara Vipond, Mercer

“When you have to get your day-to-day finances in line, how can you even think about retirement?” she says. “That’s a goal that’s way out there for many hourly workers.”

The employee benefits space can provide critical support to improve both short- and long-term financial success for frontline workers—and it’s currently a “wildly undercut opportunity” for employers to drive up the ROI they sink into wages, Flacke says.

The wheel doesn’t necessarily need to be reinvented to support frontline workers’ financial health.

“You don’t need to wipe away or replace what you have,” he says.

Instead, strategize for improvements based on the outcomes you want—helping frontliners have more financial stability in the day-to-day, for instance. This requires that leaders take a holistic approach to understanding frontline worker financial health—it is comprised of and influenced by their past experiences, current circumstances and future goals—and helping this population take the same broad view.

“You have to think about the past, the present and future,” Flacke says.

Emergency savings: a lifeline for frontliners

When it comes to the present, a cornerstone benefit to improve frontline workers’ current financial picture is access to emergency savings.

Vipond says studies have shown that Americans have an average of at least two of those $400 emergency expenses every year.

“And if you don’t have savings, you may put it on your credit card—and then you get to the point where you can’t pay the credit card,” she says. “It becomes that snowball effect.”

Employers have “a lot of new tools in the toolbox” to help frontline workers avoid that outcome, Flacke says, including through the SECURE 2.0 Act, enacted in 2022. The legislation authorized the creation of pension-linked emergency savings accounts within defined-contribution plans. Functioning like a short-term Roth account, employees can use the plans to save up to $2,500, with no minimum contribution or account balance required; distributions are untaxed.

Outside-the-box opportunities

Apart from access to emergency savings, Vipond adds, employers can also consider support through short-term loans, hardship grants and access to earned wages.

Timothy Flacke, Commonwealth
Timothy Flacke, Commonwealth

Flacke says some employers are thinking even further outside the box: A CEO of a homecare provider recently shared with him that the organization decided to cover the cost of roadside assistance for its workforce. These are workers who are often not highly paid but are relying on their own transportation to get to clients’ homes—and who may struggle financially, and miss work, if that transportation becomes unreliable.

Flacke calls the strategy a “low-cost idea with a super-high value.”

“They saw this need that could easily be overlooked from the perspective of a higher-compensated, salaried person,” Flacke says. “The cost for the firm is pretty negligible, but the impact on the workers is tremendous.”

Focus on flexibility

Eadie of WorkJam—which provides training, early wage access, schedule management and more for deskless workforces—says a key to supporting frontliners’ financial health is flexibility.

That can “manifest” in many different ways, he says.

“Using an open shift marketplace and flexible scheduling lets workers easily swap shifts,” for example, he says. “They can say, ‘Hey, I don’t work Saturday, but now I don’t have to take care of my child so I can pick up some hours.’ ”

Will Eadie, WorkJam
Will Eadie, WorkJam

Providing workers flexibility in when they can access their pay enables them to have the financial footing to handle immediate concerns, such as getting a flat tire fixed, so they can make their next shift. Flexibility can also extend to learning and development—providing bite-sized training that workers can complete when it’s convenient for them can create new and empowering opportunities.

“Flexibility is what organizations have to offer, more than anything,” he says.

The ‘outsized impact’ of information on frontline financial health

Just as powerful can be information, says Flacke.

It’s key to raise the profile on financial health options—from the new SECURE 2.0 opportunities to 529 college savings plans, which Flacke says are “tremendously underutilized by low- and moderate-income” employees.

“You can have an outsized impact through providing access to information,” he says.

That’s a goal of the financial wellness strategy at Southern Glazer’s Wine and Spirits, which employs about 24,000 people.

As part of its Next Gen rotational program—which enables recent college grads to spend two years rotating through a number of positions in preparation for manager-level roles—the organization requires participants to take part in financial education, says Amy Kickham, chief HR officer.

Amy Kickham, Southern Glazer's Wine and Spirits
Amy Kickham, Southern Glazer’s Wine and Spirits

“We talk about how they have this new job, they’ve made it to the next level—and now, what does that mean?” Kickham says. “We want to make sure their financial health and wellbeing are at the forefront as they’re making decisions to continue their career pathing.”

Representatives from the company’s 401(k) partner, Schwab, also meet with warehouse workers to direct attention to the plan and outline its impact on financial health.

HR and benefits professionals can take advantage of any topic—and time of year—that touches on finances to drive up attention and awareness, Vipond says. For instance, publicize reduced-fee tax-filing services in the spring or access to discounts during back-to-school season.

“Focus on tangible communications and financial tips and tricks if you don’t have the budget to put in place an emergency savings plan with a match or pay down employees’ student debt,” she suggests.

HR’s big opportunity

Critical to any financial health strategy is comprehensive employee listening. Surveys, focus groups and more can help HR and benefits professionals understand the financial context of their frontline workers and design benefits and programs that speak to those specific needs, Vipond says.

Consider demographics—companies whose frontline population includes many parents may want to assess how childcare benefits could enhance their financial security, as well as industry, location and company size.

“There are so many factors that come into play that need to be taken into consideration to truly have something that benefits your employees and meets them where they are,” Vipond says.

When done right—“carefully, thoughtfully, focused on outcomes,” Flacke says—efforts to improve frontline workers’ financial health can be a critical opportunity for HR to “play a more strategic role in the organization’s ultimate success.”

“HR has a seat at the table that is incredibly powerful,” Flacke says. “As a side effect of that, HR can have an incredibly positive impact on a lot of families, a lot of communities. This can be the true, proverbial win-win-win-win.”


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