Employee mental health has a direct impact on a company’s performance. In this blog series we will highlight the effects that poor mental health can have on employees and the companies they work for as well as share ways in which employers can improve the collective wellness of their workforce.
Most employers understand that mental health conditions can negatively impact workplace culture and even drive-up operational costs. Anxiety disorders are the most commonly experienced disorders, followed by mood disorders, substance abuse disorders and eating disorders. More often than not, employees who struggle with mental illness or mental health disorders are doing so silently, but these struggles are more common than they appear.
According to the National Alliance on Mental Illness, approximately one in five adults (20%) experience mental illness each year. A national poll of U.S. employees conducted on behalf of the American Heart Association found that roughly three in four employees (76%) have struggled with at least one issue that affected their mental health, and about two out of five employees (42%) were clinically diagnosed with a mental health disorder. Of those diagnosed, 63% indicated that they have not disclosed their diagnoses to their employer.
The Obvious Costs of Poor Employee Mental Health
Poor employee mental health can lead to higher health care costs for employers. In addition to the per-employee-per-month (PEPM) costs of employer-sponsored wellness program, mental health care can drive up insurance costs in general. It’s estimated that an employed person with depression has an annual average healthcare cost of over $10,000 – more than twice that of an employee without depression. Mental health disorders are often found to co-occur with other physical health disorders, further exacerbating the cost of care for those employees.
The Hidden Costs of Poor Employee Mental Health
In addition to direct care costs, poor employee mental health contributes to increased absenteeism and presenteeism. Presenteeism often shows up in the form of missed deadlines, difficulties with project management, lack of communication, and other oversights than can cost employers time, money and sometimes clients. Absenteeism, which presents itself as missed workdays due to the physical symptoms of an illness, is much higher among employees with mental health disorders and can cost employers up to $4,426 per employee per year.
Poor employee mental health can also affect a company’s turnover rate. Employees suffering from a mental health disorder are twice as likely to leave their job, leading to increased costs for recruiting, hiring, and training new employees. Studies show that employers spend an average of 33% percent of a worker’s annual salary in replacement costs if that worker leaves the company. With the current shortage of talent in the labor pool, even that may be a conservative estimate of turnover costs.
How Can Employers Improve Employee Mental Health?
Employed adults spend more time working than on any other activity apart from sleeping, so employers are already well-positioned to create a culture of improved employee mental health. The workplace typically already has communication structures in place, making it easy to implement a successful mental health wellness program, or add a mental health aspect to an existing wellness program. Below are some of the actionable steps employers can take to improve the mental health of their workforce and in turn avoid some of the costly impacts of poor employee mental health.
- Address the prevalence of mental health issues in the workplace – share statistics and information to help lessen the stigmas, clear up misconceptions and promote awareness. Use as many formats as possible to increase visibility: meetings, emails, bulletin boards, pamphlets, videos, etc.
- Provide employees access to self-assessment tools and free or subsidized clinical screenings offered by a qualified mental health professional. (Telehealth options may likely be available.)
- Offer free or subsidized counseling or self-improvement programs to employees.
- Host workshops or events that address burnout and offer stress-management techniques to help employees reduce stress and improve their focus and mood.
- Create and maintain dedicated spaces employees can use to reset or relax.
- Provide training on recognizing the signs and symptoms of stress and burnout in employees and encourage employees to reach out to qualified mental health professionals when experiencing symptoms.
Just as stress at work can affect a person’s wellbeing in their personal life, reduction in stress and anxiety at work can greatly improve their personal life. Employers who actively support the health and wellness of their employees are rewarded with a happier, healthier, and more engaged workforce – which ultimately results in a more successful business.
Stay tuned to the Emplicity Blog for more information and resources regarding mental health and the workplace. This is the first article in an ongoing series.
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Since 1995, Emplicity has provided a smarter, more secure, and integrated platform of employer services to its 300 business clients and their 8,500 employees. As a Professional Employer Organization, or PEO, the California-based HR outsourcing firm simplifies the compliance, administration, and support businesses need in the areas of employee benefits, payroll, and human resources technology.
NOTICE: Emplicity provides HR advice and recommendations. Information provided by Emplicity is not intended as a substitute for employment law counsel. At no time will Emplicity have the authority or right to make decisions on behalf of its clients.