From time to time something will happen that will knock a family out of rhythm, such as the washing machine breaking down, or the car coughing its last.
Unexpected costs like these can push households into a cycle of debt, so businesses are challenged to think creatively about how they can support their workers to prepare for these times, in addition to the challenge of raising productivity and pay.
In A Better off Britain, the CBI argues that businesses can support families by helping them build savings or by giving them a financial stake in the firm.
Having assets, savings for example, makes a real difference to living standards. But one in five people have no savings whatsoever and the typical saver only has £1,300 of rainy day savings. Businesses can help change this by enrolling their employees into corporate ISAs for example.
Corporate ISAs have tax advantages for employees and can be a cost effective benefit to for employers to offer but currently not many businesses do so due to perceived complexity and cost.
Other options businesses can take include offering share schemes to staff or becoming an employee owned business. These options can help businesses perform better and lead to employees feeling a greater attachment to their company’s success as well as helping employees build financial safety nets.
The Employee Ownership Index, which measures how well businesses do, showed that firms with some form of employee ownership saw twice the return on investment that other firms achieved.
There is also evidence that employees who take part in share schemes develop greater knowledge and understanding of how to manage their personal finances, build more wealth, and improve their health and wellbeing.
Government can change regulation to make it easier for businesses to provide schemes like these, and work with the insurance industry to explore how workplace pensions can be used more flexibly.
Building more houses is also an important part of helping workers build up wealth as a buffer against a rainy day as well as easing the cost of living.