Cost-of-living pressure is cutting into UK workers’ productivity, says report

The pressures of meeting day-to-day expenses are also leaving many workers in a constant state of financial distraction. According to the Index, 10% say they never stop worrying about money, while almost two-thirds (62%) report money-related stress. For 17%, financial strain is negatively affecting their productivity at work. This group scores nearly 26 points lower on the Index than workers who report no impact on productivity, and more than 18 points below the national average. 

The financial strain extends beyond worry. Twenty-two per cent of workers lack emergency savings to cover basic needs.  

Workers without emergency savings were especially vulnerable, with the study finding they were one and half times more likely to report declines in productivity.

The study also shows a distinct generational divide emerging, with workers over 50 being two-and-a-half-times more likely than their colleagues under 40 to cite retirement savings as their top financial concern. 

“Financial strain is showing up both in people’s mental health and in their ability to work effectively,” says Paula Allen, global leader of research and insights at TELUS Health.

“Seventeen per cent of workers report a negative productivity impact from financial stress, while 3%  have missed work entirely because of it. The findings also point to an opportunity for employers: workers are asking for clearer support around retirement and savings, while psychological safety remains closely connected to mental health.”

Demographic analysis reveals stark differences in how financial stress impacts employee mental health across age, family structure, and sector groups:

• Age: workers under 40 are three-and-a-half times more likely than those over 50 to report that financial stress is negatively affecting 
  their productivity.
• Family: managers and parents are 70% more likely than their counterparts to report a negative impact on productivity due to financial stress.
• The ‘Sandwich Generation’: a quarter of workers provide care or financial support to adult children, ageing parents, or other family members. Among those providing such support or care, 34% report a negative impact on their finances, 26% on their mental health, and 15% on their work productivity.

Retirement knowledge
Researchers also identified a substantial gap in workers’ understanding of retirement benefits. Sixty-two per cent of workers contributing to a workplace retirement programme do not have a strong understanding of how it works. Five per cent do not understand it at all and score 48.7 on the Index, nearly 24 points lower than workers who understand their programme very well (72.3). This comes at a time when many workers are struggling to balance immediate expenses with future financial goals. A limited understanding of workplace retirement benefits may leave employees less equipped to make the most of available benefits and prepare adequately for retirement, says TELUS Health. 

The report found growing demand for financial education in the workplace. More than half of workers (59%) said they would like employers to provide more guidance and resources on financial matters, particularly retirement planning and savings strategies.

The impact of mental health stigma on employee disclosure and care
Beyond economic pressures, workplace stigma remains a significant barrier to care. Although more than half of employees (53%) feel safe discussing mental health concerns with leadership, 27% would not. Furthermore, the leading barriers to seeking help for substance misuse are stigma or embarrassment (25%), confidentiality concerns (24%), and fear of workplace disclosure (21%).

The TELUS Mental Health Index data was collected through an online poll between 5–18 June 2026, among 2,000 people living in the United Kingdom who are currently employed or were employed within the preceding six months.

The full report can be found here.