As business leaders continue to identify how to respond to the economic impacts of COVID-19, PayPal and JUST Capital, in collaboration with Financial Health Network and Good Jobs Institute, announce a new initiative to make workers’ financial security and health a C-suite priority. The organizations are calling on the CEOs of America’s largest companies to conduct a Worker Financial Wellness Assessment as a vital first step toward understanding the financial vulnerability of their workforce and identifying opportunities to improve their resilience over the long-term.
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Even before the COVID-19 crisis hit the U.S. far too many working Americans were struggling to pay their bills each month, let alone save for an emergency expense or retirement. JUST Capital’s research shows that before the pandemic, 50 percent of workers at Russell 1000 companies weren’t making enough to support a family of three, even with a partner working part-time. The pandemic has only exacerbated these systemic economic inequalities.
“Markets can do more to help us build a just and equitable society,” said Martin Whittaker, CEO of JUST Capital. “Treating labor as a cost to be managed or fearing Wall Street reprisals has kept wages stagnant for more than 40 years. If we are going to deliver on the promise of stakeholder capitalism, it’s time for business leaders and investors to realize that our employees are our most valuable asset, and that investing in their well-being will drive long-term financial success.”
The new initiative aims to make workers’ financial security and health a C-suite and investor imperative. A decade’s worth of research shows that when workers are more financially secure, key business outcomes such as productivity, customer satisfaction, and employee turnover and engagement also improve. Therefore, workers’ financial wellness should be a top priority and included in any assessment of a company’s operations or planning for the future.
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PayPal’s catalytic leadership in the Initiative builds upon the innovative work the company has done to improve the financial wellness of their workforce. In 2018, after assessing the financial wellness of its hourly and entry-level employees, PayPal set a goal to increase their Net Disposable Income (or NDI) to 20 percent. By the beginning of 2021 – one full year after instituting a number of substantive changes to improve employees’ financial well-being – PayPal estimates that the minimum NDI among hourly and entry-level workers will be approximately 16 percent, up from as low as 4 percent in some regions.
“Capitalism needs an upgrade. Focusing on the financial wellness of our employees is a tangible action all of us can take to build a more inclusive and equitable economy,” said Dan Schulman, president and CEO of PayPal. “Imagine the collective impact we can have if we come together as a business community to ensure that all of our employees are not just surviving – but actually thriving. This is not only the right thing to do for our employees and our communities, but it’s also a great investment in the future of our companies.”
