Poor mental health is costing UK employers up to £45 billion, an increase of 16 per cent since it last investigated the issue in 2017, according to new analysis by Deloitte.
Researchers at the multinational professional services firm said the rise was mainly down to increases in presenteeism – when people come to work despite poor health and underperforming.
To put the issue in perspective, the report calculated that sickness absence cost firms just £7bn last year, whereas presenteeism racked up costs of up to £29bn. Mental‑health related staff turnover – when someone leaves for mental health reasons – is currently losing firms £8.6bn in costs such as for time taken to find a new employee and time and training required before a new hire is able to work at full productivity.
Rebecca George, a partner at Deloitte and public health sector lead, writing in the report’s forward said: “A sharp increase in costs, to employees and employers, are clear signs that decisive action must be taken now. We welcome wider discussions on how we can work together to prevent further rises."
Return on investment
Deloitte finds that there is a complex but positive case for employers to invest in the mental health of their employees, with a return of £5 for every £1 spent on mental health interventions. This is up from the £4 to £1 return identified in 2017.
As organinations become more insight‑driven, the report says they should start to collect data to identify the drivers of poor employee mental health and address those issues through targeted interventions. One of the highest scorers on ROI was individual health screening and personalised feedback and referral to an occupational physician.
Other initiatives which offered higher returns tended to share similarities: the potential for large‑scale culture change, a focus on prevention or the use of technology or diagnostics to tailor support for those most at risk.
How the picture has changed
In 2017 Deloitte published research for the independent Stevenson‑Farmer Review commissioned by the government.
Positive changes since 2017 include reduced stigma on mental health and greater social awareness through high profile campaigns.
On the negative, the research shows that young people are now disproportionately affected by mental health, there is a rise in burnout due to increased use of technology (and ‘leavism’) and increase in short-term contracts creating uncertainty for many.
Paul Farmer CEO of Mind, writing in the report’s forward said that despite much progress, many employees still don’t feel able to talk about their mental health.
What we can do
The report makes the case that although some approaches to encourage good mental health are better than others, essentially any effort to tackle it is better than nothing and they don’t always have to cost a lot.
Paul Farmer said this will be an imperative, as our experience and expectations of work change: “In ten years’ time employees will have ‘good work’, which contributes positively to their mental health, our society and our economy.
"To support this, all organisations, whatever their size, will be equipped with the awareness and tools to address and prevent mental ill health caused or worsened by work. They will be equipped to support individuals with a mental health condition to thrive and the proportion of people with a long‑term mental health condition, who leave employment each year, will be dramatically reduced.”
Deloitte report, Mental health and employers - Refreshing the case for investment here
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