How Employee Mental Health Affects a Company's Bottom Line

I read a short article entitled "The Hidden Cost of Turnover", which highlights both measurable and hard to measure costs of employee turn-over. The article detailed everything from the cost of recruiting fees to the "learning curve" cost of a new employee who might take time to perform at peak levels. The article didn't provide any "take away" figures on what exactly that cost might be, so I decided to look into it myself. In a study done by Bliss & Associates, Inc, they found that the cost of turnover is 150% of the employee's annual compensation. That figure grows to 200% to 250% when turnover is within managerial and sales positions. Costs included both direct expense such as advertising and temporary staffing and the indirect cost of lost productivity. With figures that dramatic, the cost of turnover quickly stops being "hidden." The next logical question in the article was "are you doing enough" to decrease turnover?


And then the article ended.


That's like leading a horse, not to water, but to an empty creek bed. Here's some of the water that was missing:


In today's job market, companies might not worry about employee retention. People who have jobs are not only glad to have them, but are often willing to carry large workloads, log extra hours and even work in hostile work environments in order to keep a steady salary. While stress and less than ideal work conditions are an unfortunate necessity at times, if employees feel an undue amount of stress and burnout, they are more likely to leave that company when the job market stabilizes. A company expecting a rebound or even growth after a period of decline, might instead find themselves hit with a costly employee exodus.


As a manager or team leader, here are questions you should ask yourself:


1) Do I know the signs of workplace stress both in an individual and at a team level?


Chronic stress has affects on the physical body. Workers might experience more frequent headaches, be more susceptible to seasonal illnesses and report difficulty resting or sleeping during time off. This, naturally, can create an increase in absenteeism. Chronic stress can also decrease cognitive ability and stamina. Trouble concentrating or completing assignments is reported as a result of chronic stress.
At the team level, low morale will result in a lack of cohesiveness in decision making, more frequent office conflict and lower work quality.


2) Do I know how to decrease workplace stress for my employees?


While it is tempting to squeeze out every bit of time from employees when a company does not have the ability to increase staff size, it is important to realize that more hours in the work day does not equal more productivity. Maintaining healthy work hours and work boundaries keeps employees mentally sharp and more efficient. Challenge: for one or two weeks, avoid sending emails or work-related requests after business hours. During that one week, require employees to honor business hours; if it is time to go at 5pm, they should go home. If a project or deadline makes that impossible, require that they leave early the next day. After a week or weeks, do you notice a difference? Reports have been made that companies who work a four day week are just as productive as those who work a five day week. Could it be because those who work four days a week are more mentally rested and energized for their work?


Other areas for consideration include:
- Do employees experience chronic work overload?
-Do they experience unfair treatment by co-workers or team leaders?
-Are the expectations of employees reasonable or impossible?
-Have employees received adequate training? This is especially valid if employees have been asked to perform tasks outside of their job description due to downsizing.
-How are employees recognized for their work, especially when it is "above and beyond" the call?
-Is there clear direction about company and individual priorities?


3) Do my employees know how to manage their workplace stress?


Perhaps the question you are asking right now is, should it be my responsibility to make sure they can manage their stress? In short, yes. It will have an affect on your bottom line; more importantly, however, depending on the type of industry you are in, it is unethical to knowingly use chronically stressed, burned out employees. This is especially true in health care, helping professions such as counseling and social work, and in education. Make wellness and self-care a priority for your company and employees. Encouraging people to participate in their own care shows them that they are seen as whole individuals, not simple "workers."


Recently, an accountant for a small company expressed to her boss that she was feeling unfocused and tense because lately she hadn't been able to find the time to run. This was something that she had always used as a stress reliever. Her boss would have every right to simply ignore the statement. After all, the work day is the work day. Instead, he said, "How can we make it work that you get done what you need to do for this company and still have time for your run?" In a matter of 5 minutes they had decided that one day a week, she would come in an hour earlier so she could leave for a run at the end of the work day. It's my guess that this woman not only feels less stress and anxiety, but also has more positive feelings and loyalty toward her boss and company.


Workplace stress can be difficult to navigate for managers and employees alike. Indeed, we did not even address the burnout that is experienced by management! If your company has arrangements with an EAP, use it! If not, contact us at Lotus Counseling and Consulting to help you manage workplace stress and, in turn, make your company more productive and profitable.