Debt has an impact on the performance of employees at work as it robs them of their focus.
Image: File
The quiet anxiety of mounting debt and shrinking pay packets is no longer confined to South African homes. It is showing up in offices, warehouses and shop floors, eroding productivity and employee wellbeing as the cost of living tightens its grip.
With fuel prices rising, electricity tariffs set to climb and global tensions feeding into higher everyday costs, employees across income brackets are under sustained financial strain.
South African Reward Association executive committee member Lindiwe Sebesho said the pressure facing workers is layered and persistent, despite some positive signals in the recent national budget.
Households are grappling with debt repayments that take up large portions of income, alongside rising grocery bills, high interest rates on home and vehicle finance, and escalating utility costs. Income insecurity — driven by unemployment, slow wage growth and organisational restructuring — is compounding the stress.
Sebesho said financial distress is no longer limited to lower-income groups. Banking data indicates that many consumers, including higher earners, are either in overdraft or close to exhausting their funds by payday, with some increasingly reliant on borrowing to sustain themselves and support extended family.
“Financial stress is not just a personal issue; it’s a business risk,” she said. “When employees are distracted by financial worries, their focus, engagement, and performance at work are affected. Organisations must recognise that supporting employees through these pressures is essential for sustaining productivity and retention.”
The pressure is expected to intensify. In March 2026, fuel prices rose again, driven by geopolitical tensions in the Middle East, with higher fuel levies coming into effect from 1 April. Electricity costs are also set to increase, with tariffs rising by nearly nine percent and municipal hikes expected to follow in July. Food prices, closely linked to transport and production costs, are projected to climb further.
“For the employee who drives 40km to work each day, these are not abstract realities, they are the difference between making it to work or not,” Sebesho said.
Inside workplaces, the strain is becoming visible. Employees unable to afford transport may call in sick. Others appear distracted in meetings as they juggle which expenses to defer. Employers are reporting increases in garnishee orders, salary advance requests, absenteeism, disengagement and staff turnover.
There is also a growing health impact. Anxiety, depression and substance use linked to financial stress are on the rise, reflecting what Sebesho described as “the human cost of sustained financial pressure without support”.
She said employers have a direct role to play in mitigating the impact, starting with fair and equitable pay. This includes regular salary benchmarking against industry standards, reviewing benefits, and addressing historical disparities across roles and demographic groups.
“Benchmarking salaries against actual cost of living and local skills demand ensures pay is meaningful, not just aligned with national averages or inflation,” she said.
Financial education is another key intervention. Budgeting support, debt management guidance and retirement planning — delivered in accessible language — can help employees regain control over their finances.
Employers are also being encouraged to consider earned wage access, allowing workers to draw a portion of their income before payday to meet urgent expenses, reducing reliance on high-interest credit and limiting absenteeism.
Additional measures include confidential counselling through employee assistance programmes, flexible work arrangements to ease transport costs, and training managers to identify and respond to signs of financial distress.
“Supporting employees through financial stress is operationally prudent,” Sebesho said. “Turnover, lost productivity, and administrative risk from unmanaged garnishee orders carry a high cost. Organisations that act now will protect their bottom line and strengthen their reputation as an employer of choice.”