A survey by the Employee Benefit Research Institute (EBRI) indicates that financial concerns in the short term are sidelining retirement savings for many hospitality workers.
The study, conducted from September to December 2024 with 64 users of Fuego, found that respondents were far more focused on their current financial needs than on their long-term retirement goals.
Short-Term Financial Pressures Take Priority
The survey asked participants to identify their top three financial stressors, and the results were clear:
- 60% of respondents cited paying daily bills as their biggest concern
- 46% prioritised handling unexpected emergencies
- 33% worried most about job security
The study found that only 19% of respondents considered “saving enough for retirement” a top priority, pointing to the overwhelming focus on immediate financial needs. EBRI highlighted,
“The key difference between hospitality workers and the general worker population is that hospitality workers prioritise monthly bills over retirement savings, reflecting greater short-term financial stress.”
Comparison with Broader Workforce Trends
The results, when compared to wider workforce trends, emphasise the distinct financial stress faced by hospitality workers and its impact on savings behaviour. Insights from the 2024 EBRI/Greenwald Research Workplace Wellness Survey help to clarify this connection.
- 48% of the general workforce prioritised retirement savings
- 45% emphasised having emergency savings
- 42% focused on paying monthly bills
While emergency savings and daily expenses were common concerns across both groups, hospitality workers were significantly less likely to prioritise retirement. Their reliance on services like Fuego, which provides early access to wages, further underscores the financial strain they experience.
Pay-On-Demand Spending Patterns
The survey also revealed how hospitality workers using pay-on-demand services allocate their earnings:
- 76% of respondents spent at least some of their wages on food
- 47% used the funds for housing expenses
The spending pattern observed in the survey suggests that many workers are relying on these services for essential needs rather than discretionary purchases, signalling a diminished focus on long-term financial planning. EBRI noted, “The regular use of a pay-on-demand product may also indicate a decreased predisposition to long-term saving.”
Survey Limitations and Considerations
EBRI warned that the findings should be taken with caution, as they represent a small sample. “Given the small sample size of the survey, results should be interpreted as a case study, reflective only of the respondents’ experiences. Results should not be generalised to the broader population,” the report stated.
Nevertheless, the results align with previous research indicating that financial stress in the short term can impede retirement planning. Meeting current financial needs trumps the goal of securing long-term financial stability for hospitality workers.