Now more than ever, don’t cut your employee wellbeing budget
In today’s ever-changing, fast-paced and uncertain business world, investing in mental wellbeing initiatives is more important than ever. Organisations that offer wellness initiatives for their employees are not only investing in the wellbeing of their employees but are also seeing improvements in business performance, and employee engagement and productivity.
What’s the cost of not investing?
Although most organisations happily support the wellbeing of their people, without needing a financial incentive to do so, it’s reassuring to know that investment in wellbeing is clearly good for business as well. Research shows that investing in employee mental wellbeing initiatives can have a significant impact on business performance. According to a recent study conducted by the World Health Organization (WHO), depression and anxiety disorders cost the global economy $1 trillion USD per year in lost productivity.
Think about your own experiences in the past where your mental wellbeing has been low. How productive were you? How willing were you to take risks? Take on more challenges? How adaptable were you to a changing business landscape? Sadly when our mental health suffers, so does our productivity and performance at work.
Mental health issues have also been shown to lead to an increase in absenteeism, presenteeism (employees present at work but not fully productive), and staff turnover.
What’s the link between Wellbeing, Employee Engagement, Productivity and Profitability?
A study by the American Psychological Association found that organisations that prioritise employee wellbeing had 3.5 times the revenue growth of their competitors. Additionally, companies with a robust mental health programme experience an average of $2.30 to $5.60 return on investment for every dollar invested on those programme.
Similarly, according to a study conducted by Deloitte, companies that prioritise employee mental wellbeing see increases in employee engagement and productivity, leading to a 12% higher profitability rate compared to their competitors.
This is supported by a number of other studies:
- The Harvard Business Review found that employees who receive mental health support are 81% more productive and take 2.6 fewer sick days per year.
- The Mental Health Foundation of New Zealand found that implementing mental health initiatives in the workplace increased employee engagement by 17% and increased productivity by 12%.
- Gallup found that companies with high levels of employee engagement had 21% higher profitability rates than their competitors.
- One Deloitte study also found that a far greater percentage of these companies’ employees, 80%, feel more loyalty to the company.
- A study by Mercer found similar results: employees who received mental health support were 40% less likely to leave their job within the first year.
As an added bonus – you also benefit from increased business innovation
Investing in employee mental wellbeing initiatives also has a positive impact on the ability of businesses to adapt and innovate. The New Zealand Mental Health Foundation study found that when employees felt supported by their organisation, they were more likely to be creative and innovative in their work. This means that businesses that prioritise employee mental wellbeing initiatives are more likely to have employees who are able to adapt to changing circumstances and come up with new ideas to help the business succeed – a crucial competitive advantage in uncertain times!
The evidence is pretty convincing, mental wellness initiatives for employees are a vital investment for any business. With the uncertain economic climate we face today, investing in these initiatives is more important than ever. As stated by the Mental Health Foundation of New Zealand, “Employees are the backbone of any business, and looking after their mental health and wellbeing can lead to a more productive, engaged, and happy workforce.”
If you are a senior HR exec or people leader, what steps are you taking to prioritise employee mental wellbeing and create a positive work environment that supports employee mental health?
If you would like to see how we have supported dozens of organisations to make the most of their wellbeing strategy to support their people and performance at work please get in touch with Debbie on debbie.schultz@blueskyminds.org.
Sources:
- World Health Organization (WHO) study: “Depression and Other Common Mental Disorders: Global Health Estimates.” Published in 2017.
- American Psychological Association study: “The ROI of Employee Well-Being.” Published in 2016.
- Deloitte study: “Mental Health and Well-being in Employment: Final Report.” Published in 2020.
- New Zealand Mental Health Foundation study: “Exploring the Relationship between Creativity and Mental Health in the Workplace.” Published in 2019.
- Harvard Business Review study: “The Business Case for Managing Mental Health.” Published in 2019.
- Gallup study: “Employee Engagement on the Rise in the U.S.” Published in 2021.
- Mercer study: “Promoting Mental Health: Addressing the Business Case.” Published in 2019.