Nov 22, 2023
It’s always been obvious that there is an inextricable link between worker health and productivity, with the former generally influencing the latter. In other words, the better a worker’s health, the higher their productivity.
Although this loss in productivity is undoubtedly a major blow to the success and profitability of any company, there is a growing body of data to suggest that these losses in aggregate can be devastating to the overall economy and market.
According to a study from the Integrated Benefits Institute (IBI), poor health costs employers in the U.S. an average of $575 billion in lost productivity. That means for every dollar of the nearly $950 billion spent on health care benefits by U.S. employers, an additional $0.61 of productivity is lost to illness and injury.
Plus, employees covered for sick time, workers’ compensation, disability, and FMLA benefits incurred are absent an estimated 978 million days due to their illness and incurred approximately 540 million lost workdays by underperforming at their job due to a chronic health condition (also known as presenteeism). This equals a combined 1.5 billion days of illness-related absence every year.
The survey suggested that employers will have to take productivity loss into account when performing any cost/benefit analysis on benefits offerings for employee health outcomes. IBI President Kelly McDevitt said, “Employers who primarily focus on the cost of health care expenses and don’t include the cost of lost productivity and the effects on their business outcomes and employee total wellbeing should look closely at these results. Designing programs and benefits that more fully support today’s employee needs will be an investment in long term success for their business.”
These conclusions were further strengthened in 2023 with the publication of a meta-study in The Journal of Medical Economics. A meta-study is a research term that means a study of other studies. In other words, the researchers look at big trends on a macro scale over a wide body of research in a specific subject, in this case the phenomenon of lost productivity due to employees not working or working less because of certain diseases and medical conditions.
Not only did the 2023 study support the IBI study’s conclusions, but it strengthened the findings.
First, the study concluded that the diseases that were the primary culprits for this productivity loss included cancer, chronic lung disease [bronchitis, asthma, or chronic obstructive pulmonary disease], depression, pain, and cardiometabolic disease [heart disease, hypertension, or diabetes].
Furthermore, most studies concluded that, on average, employees lost up to 80 annual work hours, with those suffering from cancer and cardiometabolic disease as accounting for the greatest annual incremental number of work hours lost. Plus, work impairment was highest for employees suffering from pain and depression, which are the two most common comorbidities for many of the other conditions listed.
Finally, the annual cost of lost work productivity, which could range anywhere from $100 to $10,000 per employee, was higher among those suffering from cancer, pain, and depression.
It’s more important than ever for employers consider “the big picture” when trying to determine what kinds of benefits they want to offer and how they might save some money by spending some money.
Our reps can partner with you and help you to develop unique benefit strategies to meet your clients’ specific needs and expectations. Contact your Amwins Connect Sales Representative to learn more.
