London Market Monitor – 31 August 2022
Our August review of the markets and Solvency II discount rates.
On average, Americans will spend 13 years and two months of their lives at work.1 During that time, employers influence everything from professional development to the health and well-being of their employees. In today’s hypercompetitive business environment, employers can benefit from dedicating resources to nurturing resilience in the workplace.
Resilience is a person’s ability to bounce back and recover quickly from adversity. Almost everyone experiences misfortune at some point during their career. Whether that hardship comes in direct relation to work or from outside factors (the current pandemic is a great example), the results can be costly to both employee and employer.
Absenteeism and presenteeism have serious costs for businesses.
In a research report published by the Centers for Disease Control and Prevention (CDC), the authors studied absenteeism due to chronic diseases (hypertension and diabetes) and unhealthy behaviors (smoking, physical inactivity, and obesity).2 The results were sobering.
Absenteeism estimates ranged from 1 to 2 days per individual per year depending on the risk factor or chronic disease… Absenteeism increased with the number of risk factors or diseases reported. Nationally, each risk factor or disease was associated with annual absenteeism costs greater than $2 billion. Absenteeism costs ranged from $16 to $81 (small employer) and $17 to $286 (large employer) per employee per year.
Presenteeism refers to employees who are physically at work but, due to illness or medical conditions, are unable to fully perform their duties. According to a recent study produced by the Integrated Benefits Institute, “Employees covered for sick time, workers’ compensation, disability, and family and medical leave benefits are absent about 978 million days due to illness and incur an estimated 540 million lost workdays due to presenteeism…” 3
Losing employees can be just as devastating as absenteeism and presenteeism. Productivity can take a hit, as other team members are tasked to cover a former colleague’s work as well as their own. Finding a replacement who can get up to speed quickly can be equally challenging, with one survey reporting that one-third of new hires fail to meet productivity targets.4
Turnover can also impact morale, creating a climate where the remaining workforce is stressed, unhappy, or otherwise disengaged. From dwindling creativity to more accidents on the job, these unhappy workers cost employers up to $550 billion a year.5
Given the detrimental effects of productivity loss and chronic health conditions, employers may find significant benefits to building resilience in the workplace.
There are a variety of structural and policy-driven ways to approach this challenge, with robust employee wellness programming at the forefront. A RAND Corporation study uncovered an overall return of $1.50 for every dollar invested in an employee wellness program. When viewing the program by each component (disease management versus lifestyle management), it reported, “…the returns for the individual components differ strikingly: $3.80 for disease management but only $0.50 for lifestyle management for every dollar invested.”6
Encouraging positive lifestyle and disease management is important, but giving employees clear, actionable ways to do so is even more important.
Regularly tracking basic vital signs such as blood pressure, blood glucose, and weight can help employees develop a baseline understanding of their health. Over time, these measurements create a fuller picture, revealing trends and opportunities for improvement.
Similarly, tracking wellness activities, such as sleep quality, mood, and hydration can help employees feel a greater sense of engagement and ownership in their own health. Viewing wellness trends over time can help employees see the relationship between activities and outcomes, spurring on positive behavior changes.
Social support has been shown to contribute to resilience as well.7 This support can come in many forms, including informational support such as guidance and mentoring.8 Wellness programs that incorporate health coaching can provide the informational support employees need to improve their health outcomes. Health coaching provides employees an accountability partner and a safe place to explore strengths and motivations for a healthier lifestyle.
The importance of mental health has taken center stage during the pandemic. Wellness programs that include mood tracking and reminders to connect with friends and family can lead to increased emotional intelligence (the capacity to be aware of, control, and express emotions). When an employee has high emotional intelligence their communication skills, rational thought patterns, and ability to express and feel empathy are all increased. Feeling heard, understood, and connected in the workplace are critical for individual resilience.9
As an employer, the investment you make to support the physical and mental health of your employees can pay dividends. What are you doing to foster resiliency in your employees? Think beyond the basics. Forward-thinking organizations of all sizes are leveraging the current focus on health and healthcare to foster employee engagement and ownership of health.
When comparing wellness program options, consider finding a solution that includes the following elements:
Show your employees that their well-being is paramount to the company’s success. Resilience in the workplace won’t happen overnight but offering an employee wellness program can be a step toward greater health and job satisfaction for the team.
1 Belli, G. (October 1, 2018). Here's how many years you'll spend at work in your lifetime. Retrieved November 29, 2021, from https://www.payscale.com/career-news/2018/10/heres-how-many-years-youll-spend-work-in-your-lifetime.
2 Beeler Asay, G., PhD, Roy, K., PhD, Lang, J., MPH, MS, Payne, R., MPH, & Howard, D., PhD. (October 6, 2016). Absenteeism and Employer Costs Associated With Chronic Diseases and Health Risk Factors in the US Workforce. Retrieved November 29, 2021, from https://www.cdc.gov/pcd/issues/2016/15_0503.htm.
3 Integrated Benefits Institute (December 8, 2020). Poor Health Costs US Employers $575 Billion and 1.5 Billion Days of Lost Productivity per Integrated Benefits Institute. Press release. Retrieved November 29, 2021, from https://www.ibiweb.org/poor-health-costs-us-employers-575-billion/.
4 Cision PRWeb (May 21, 2012). Companies Lose One-Quarter of All New Hires, Survey Says. Press release. Retrieved November 29, 2021, from https://www.prweb.com/releases/2012/5/prweb9528745.htm.
5 Clifford, C. (May 10, 2015). Unhappy Workers Cost the U.S. Up to $550 Billion a Year (Infographic). Entrepreneur. Retrieved November 29, 2021, from https://www.entrepreneur.com/article/246036.
6 Mattke, S., et al. (January 9, 2014). Do workplace wellness programs save employers money? RAND. Retrieved November 29, 2021, from https://www.rand.org/pubs/research_briefs/RB9744.html.
7 Cherry, K. (April 10, 2021). What is resilience? Very Well Mind. Retrieved November 29, 2021, from https://www.verywellmind.com/what-is-resilience-2795059.
8 Cherry, K. (April 14, 2020). How Social Support Contributes to Psychological Health. Very Well Mind. Retrieved November 29, 2021, from https://www.verywellmind.com/social-support-for-psychological-health-4119970.
9 Hayes, M., Chumney, F., & Buckingham, M. (2020). 10 Facts About Resilience: Executive Summary. ADP Research Institute. Retrieved November 29, 2021, from https://www.adpri.org/wp-content/uploads/2020/09/03154031/R0121_0920_v1_RS_ExecSummary.pdf.