Poor employee health sees £92 billion productivity loss

12 March 2020 Consultancy.uk 4 min. read
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The UK economy lost almost £92 billion in 2019 as a result of ill-health related absence and presenteeism in the workplace. As some experts warn the Coronavirus outbreak could impact as much as a fifth of the workforce, companies must prepare for this situation to get worse before it gets better.

The UK economy is currently facing a sustained period of pressure, thanks to a growing productivity gap. This could get worse quickly; as Brexit finally comes to a conclusion, the global economy seems to be edging toward a recession, while the international outbreak of the Covid-19 virus threatens to exacerbate matters.

As it is, the UK already loses a massive £91.9 billion in productivity thanks to employee health issues, according to a new study from Vitality. The UK -based company specialises in private medical insurance sold to the UK market, and its survey found that the situation has worsened significantly over the last year, with employee health matters costing British businesses and the economy an estimated £91.9bn in 2019 – spiking by over £10 billion since 2018. 

The study, now in its eighth year, is developed by Vitality and delivered in partnership with RAND Europe, the University of Cambridge, and Mercer, and is one of the largest and most comprehensive surveys on workplace wellbeing in the UK, surveying 26,393 employees and 130 businesses across the UK in 2019. By the reckoning of the researchers, British businesses lost an average of 38 working days per employee in 2019 – around a week more than in 2017 – meaning that added to the start of 2020, February 21st would have been the UK’s ‘first productive day.'

Days of productivity lost per employee per year

According to the researchers, the issues setting companies’ productivity back included physical and mental health related absence, and presenteeism – or the practice of turning up for work in spite of illness in order to keep up to speed with targets. Indeed, despite the issue having been on the agenda for some time, the study showed presenteeism continues to rise. Now, 45% of UK workers admit to suffering from presenteeism in 2019, up almost a third from 2014 (29%), suggesting that even though bosses know sick staff will not be able to give their best, they are still employing practices to pressure them into working.

Commenting on the publication of today’s data, Neville Koopowitz, CEO at Vitality, said, “It’s no longer enough to create a health and wellbeing programme for employees and hope they’ll make use of it. The businesses that not only prioritise it, but also properly consider how they engage their employees to improve their mental and physical health, can see productivity increase in their workforce by as much as 40%, which is no insignificant number.”

Young workers aged between 18 and 25 were found to be particularly vulnerable to this, due to the precarious nature of the work many of them are subjected to. On a zero-hour contract, or even as a ‘freelancer’ employed in customer services, taking a sick-day can see them essentially blacklisted by bosses looking to ensure staff turnout. As a result, 55% of this demographic admitted to turning up for work but feeling unable to perform at their peak productivity, compared to just 38% of employees aged 45 or over.

Worryingly, the same age group were found to be the most likely to struggle with their mental health, with almost 1 in 7 young workers suffering from depression (15%) and many more saying they have felt unwell because of stress in the workplace (35%). This is far higher than the over-50s group – where just 4% said they suffered from depression. This looks set to deepen the UK’s productivity crisis, as across all UK employees, those with higher rates of stress and anxiety made unhealthier choices overall – being more likely to smoke, binge drink and have unhealthy diets – making health problems more likely down the line.

Chris Bailey, Partner, Mercer Marsh Benefits, added, “This is a watershed moment for UK organisations, with greater than ever awareness around mental health, increased focus on inclusion, and more opportunity to access large employee bases through technology. In tackling the issue of wellbeing in the workplace, businesses must reach beyond the latest tech and ensure the support offered to employees is tailored and communicated well.”