Around one in four people are finding it difficult to do their job because of serious money worries.
A survey of more than 1,800 UK employees, also suggests that almost a third of 18-24 year-olds and a third of people living in London are struggling with financial issues.
Physical fatigue caused by lost sleep worrying about money is a major drain on productivity with one in five employees (19%) reporting this as an issue, the research conducted by the Chartered Institute of Personnel and Development (CIPD) and Close Brothers Asset Management says.
However, wage appears to have little to do with financial stress, with one-fifth of employees earning between £45,000 and £59,999 believing money problems have affected their ability to do their job.
Women are also more likely than men to have money worries, which affect their professional life. Some 28% of women say they are struggling to manage compared to 23% of men.
Pensions changes, longer life expectancy, rising inflation and tax changes have all contributed to the consumer stress, the report adds.
Charles Cotton, reward and performance adviser at the CIPD, says: “Money worries affect people regardless of their age, gender or level of pay, and with one in four admitting it negatively impacts their work, it’s clear that organisations should be focussing on financial well-being as part of their workplace agenda.
“This will become increasingly important over the next 18 months, as rising inflation is likely to lead to a pay squeeze and increased concerns about personal finances.
“Employers not only have a duty of care to their employees but will also see their bottom lines benefit if they invest time in developing a financial well-being strategy and play an active role in supporting staff in this area.”