Counting the cost of mental health in business
7 February 2020: new analysis has put the cost to business of poor mental health at a staggering £45bn, with professional services firms on the front line. So what support mechanisms can businesses put in place to tackle these issues and build resilience in staff? Rachel Willcox investigates.
If you’re having a well-earned lunch break to read this article, we applaud you. After all, the accountancy profession has long had a reputation for a culture of long hours, hard work and stress. It’s no coincidence that instances of employee burnout and mental health issues are rife.
More than just a matter of concern for those individuals struggling to cope, the knock-on financial cost to business of poor mental health now tips the scales at a staggering £45bn in mental health-related absenteeism, staff turnover and productivity issues. This is up 16% from two years ago, according to analysis by Deloitte in conjunction with mental health charity Mind.
One in six workers will experience a mental health problem at any one time, the report finds, and stress is now thought to be responsible for almost half of working days lost in Britain due to health issues.
The good news is that employers are getting better at openly discussing mental health at work and workplace provision of support has increased, the report says. What’s not so encouraging is that a significant rise in mental health-related "presenteeism", where employees work when they are not at their most productive, suggests that staff still feel there is a huge stigma attached to opening up to their employers about any mental health issues they may be experiencing.
At the same time, changes in working practices are further compounding problems. In particular technologies that enable working outside normal working hours allow and facilitate an "always on" culture, and make it increasingly difficult for staff to switch off from work.
A positive case for investing in mental health
The report makes a positive case for employers investing in mental health, with an average return of £5 for every £1 spent. Mind CEO Paul Farmer called on the government to increase the standards expected of employers to ensure that people with mental health problems are supported in work and have access to rights and protections.
“This includes steps such as improving the statutory sick pay system so that people are able to take the time off they need when unwell, which would also reduce current costs to employers of presenteeism”, Farmer said. He added that many people with mental health problems don’t realise that they have a right to reasonable adjustments if they need them under the Equality Act 2010.
Liz Hampson, a director at Deloitte and co-author of the report told ICAEW Insights: “The cost among professional services firms is over £2,000 per employee per year, not because of a higher prevalence of problems but because the cost of losing someone is higher in those industries.”
Hampson warned that firms should ensure they have support mechanisms in place and think about ways to build resilience in staff. “You need diagnostics to identify people at the early stages of a problem and allow people access to tools without stigma.”
Kelly Feehan, Services Director at CABA, the charity that supports chartered accountants’ wellbeing, said money is best spent at the preventative end of the spectrum and by having wellbeing embedded in your business.
“Whatever you do, be authentic otherwise people won’t use it. Having mental health first aiders and offering flexible working can help. But ask your staff what’s going to work for them because one size doesn’t fit all. Some people are very routine-based so for them, the idea of working from home might fill them with horror.”
Key facts from the report
- £42bn to £45bn – annual cost of poor mental health for UK employers each year
- £6bn or 16% – increase in cost of poor mental health since 2017
- £7bn – cost of absences due to mental health issues
- £27bn to £29bn – cost of presenteeism
- £9bn – cost of staff turnover due to mental health issues
- 9% – those who disclosed a mental health problem who were dismissed, demoted or disciplined