To Care or Not to Care
Poor health comes at an astonishingly high financial cost.
The costs of poor workplace well-being are enormous. If we just look at mental health, we can see that in 2007, the overall yearly cost of mental ill-health to UK companies was £26 billion, or £1035 per employee.
That’s just a matter of mental health. If you factor in back, neck, and muscle ailments, another amount of £14 billion will be added. Presenteeism, which is linked to illness, was expected to cost the UK economy £108 billion a year in 2012.
And, given the evidence that mental health is deteriorating rather than improving, several of these figures are likely to worsen without immediate organizational intervention.
Positive mental health may help reduce turnover and the costs that come with it.
According to a study by Wright and Bonett (2007), managers with low happiness levels were more likely to leave their employment due to discontent. This shows that expenditures in employee well-being that reduce job discontent may reduce turnover.
High turnover has numerous apparent costs, such as recruitment and training. Intangible costs, such as the loss of tacit knowledge and crucial nodes in interpersonal networks, are also present with the knock-on effects of processes like collaboration.
There is proof of a positive return on investment.
According to a study from London Business School, organizations with high happiness levels outperform the stock market by 2% to 3% per year.
Previous research, such as Wright and Staw (1999), has found substantial links between employee happiness and performance.
And the proof isn’t simply hypothetical. Anglian Water claims that for every £1 spent on staff well-being, they have earned £8 in return.
1 Investors in People, Accessed 4 Dec 2021, https://www.investorsinpeople.com/knowledge/the-power-of-wellbeing-how-investing-in-staff-delivers-dividends/
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