How Workplace Stress Hurts the Bottom Line

1 in 5 Canadians experiences a mental health problem or illness each year, which equates to 500,000 employees unable to work each week, according to the Mental Health Commission of Canada. Among those suffering from mental health issues, more than 1 in 3 name workplace stress as the primary cause.

The business case is a simple one: Workplace stress significantly increases company costs. Even before the COVID-19 pandemic hit, chronic stress was one of the fastest-growing sources of workers’ compensation claims. Anxiety and displacement from COVID-19 will only accelerate that trend. Stress also reduces profitability by reducing productivity.

According to the World Congress on Health and Safety at Work, of the 40.2 million working days annually lost by businesses worldwide, 13.4 million are from stress, anxiety and depression. Experts say that stress is on pace to become as prevalent and costly to businesses as “traditional” workplace hazards like ergonomic, fall and chemical hazards.

These stats are fascinating, however, they don’t explain how workplace stress hurts businesses. It can be a tricky claim to prove because stress isn’t a line item cost listed on a typical budget sheet. It’s a bundle of hidden costs. Four primary elements can explain what these costs may look like. 

1. Higher Injury and Illness Rates – The more stress workers experience at work, the more likely they are to engage in unsafe behavior. The result is more incidents involving personal injury and/or damage to equipment.

2. Worker’s Compensation – Mental health-related WCB claims have increased dramatically in recent years. And so have the stipulations for coverage. In the past, workers’ compensation benefits were available only to workers who experienced mental illness or disorder as a result of a traumatic event at work, such as being robbed or assaulted. Many provincial Compensation Boards, including Saskatchewan’s, now also cover cumulative mental stress developed after repeated exposure to workplace stressors such as bullying or harassment.

3. Higher Turnover – Workers experiencing stress as a result of work are more likely to leave the company. In addition to losing good people, companies incur high administrative costs in seeking replacements. As the company gains a reputation for being a stressful place to work, recruitment may also be negatively impacted.

4. Reduced Productivity – Workplace stress harms workers’ productivity and performance. The effect of stress on productivity is hard to measure; but it’s real.

There is some good news about workplace stress – it CAN be managed. For example, Employee Assistance Programs (EAPs) can be an effective resource for reducing stress on the job. These solutions cost money and time, but they can be worthwhile investments when you compare them to the potential cost of workplace stress.

If your organization isn’t sure where to start, or needs some assistance with your workplace mental health initiative, reach out to a Service Hospitality advisor to chat further about our suite of services that can help, including our

• Psychological Health & Safety Audit

• Health & Safety Leadership Certificate (HSLC) program

• Mental Health Best Practice Group

• And more…

Our next Mental Health Best Practice Group meeting will be held virtually on Wednesday, October 7^th. If you are interested in joining a group of mental health-focused employers, attending free events featuring mental health experts, and working towards a healthier Saskatchewan, visit our MHBPG webpage, or email [email protected] for more information!