Financial health is on everyone’s mind as the cost of living continues to rise. But how have those stressors been affecting Canadian workers’ mental health?

Each month, Telus Health releases its mental health index report, which measures the current state of Canadian employees’ mental health in an effort to support wellness initiatives for businesses. Data was collected from 3,000 workers across the country who are currently employed, or who were employed within the last six months.

This month’s report focused on how employees’ mental wellness is being affected by their financial health. There is a strong correlation between financial and mental health – as financial health improves, so do mental health scores.

The mental health index (MHI) for this month was 62.9, marking a sharp decline from the prior month, where it sat at 64.8.

Overall, the financial wellbeing index (FWI) score dropped to 61.3, nearly three points lower than it was in summer 2022. Currently, it’s at its lowest point since the launch of the index in January 2021.

Women have a lower financial wellbeing score (58.6) than men (64.3), and households with children reported lower scores than those without.

Nearly half of Canadian employees have felt overwhelmed by debt, but 61% haven’t reached out for financial advice or coaching to manage it, with 21% citing that embarrassment of addressing the issue is what’s holding them back. Of the 11% who said they did ask for help, their mental and financial wellbeing scores were higher.

More than two in five employees said they feel concerned or uncertain about their financial future, with 12% reporting that they anticipate times of struggle ahead. Just over one-third of employees who accumulated savings during the pandemic have found themselves having to dig into them to maintain their current standard of living.

This month’s survey also included findings on how workers viewed their financial futures over the next 10 years. More than one-third (36%) believed they will be somewhat comfortable, 26% were unsure and 21% said they will be comfortable. The highest mental health (74.2) and financial well-being (75.0) scores are among 21% who reported they will be financially comfortable, with the lowest mental health (37.8) and financial wellbeing (33.5) scores are among 5% of respondents who said they will be in a very difficult financial situation. Individuals without emergency savings are also nearly three times more likely than individuals with emergency savings to believe they will be in a very difficult financial situation.

When it comes to investing or retirement planning, 40% of workers said that these types of automatic savings programs and incentives would be most valuable if they were offered by their employers compared to offerings such as discounts for day-to-day services or personal financial advice. Thirty-six percent of respondents even reported that they would leave their current employer if they could find a job that offered automatic savings for investing.

But pension plans weren’t the only benefits drawing employees to companies, according to the report. One-third (33%) reported interesting work as the primary motivator apart from income, while 25% said they only work for money to meet their needs. Other factors that were important for employees included opportunities for personal and professional development (18%) and engaging in purpose-driven work (12%). The lowest mental health (56.3) and financial wellbeing (55.1) scores were among a quarter of individuals who only work for money to meet their needs, while the highest mental health (67.5) and financial wellbeing (65.9) scores were among 4% of respondents who said social opportunity motivated them most when choosing an employer.

With financial health being a primary focus in this month’s report, the survey also factored in employment aspects. Overall, 4% of respondents were unemployed and 10% reported reduced hours or reduced salary. Individuals working fewer hours compared to the prior month scored the lowest mental health score (51.9), followed by individuals reporting reduced salary (54.2), individuals not currently employed (60.1) and individuals with no change to salary or hours (64.2). Canadian workers in the gig economy showed lower mental health scores than workers with full-time permanent employment.

In terms of financial wellness, individuals reporting reduced salary compared to the prior month have the lowest financial wellbeing score (47.4), followed by individuals working fewer hours (51.3), individuals not currently employed (56.7), and individuals with no change to salary or hours (62.7). Employees with full-time permanent employment reported better financial well-being scores than those in the gig economy.

By industry, employees working in administrative and support services had the lowest mental health score (54.7), followed by individuals working in food services (55.9) and agriculture, forestry, fishing and hunting (60.3). Respondents employed in mining, quarrying and oil and gas extraction (71.1), transportation (68.8) and professional, scientific and technical Services (68.5) had the highest mental health scores this month.