There is a vast chasm between what we know about depression’s effects on the workplace and what we do about it. At One Mind at Work we commissioned an economic study and found that depression is a serious mental illness that affects 8.4% of US adults, but despite its prevalence, approximately 71% of people don’t get the support they need. For many experiencing depression without workplace support, a negative, unproductive work day could be their experience every day.
As employers search for ways to attract and retain talent, and run a successful business, it’s critical to understand the true toll that mental health challenges can take.
Why are the costs of depression so high?
Some of the key reasons depression is not addressed are:
· Depression is underreported. Gaps in employee insurance coverage, provider behavior, and difficulty in accessing mental health care are primary factors in underreporting.
· Employers assume mental illness doesn’t impact work. This is a false assumption—mental health challenges like depression do impact work.
· Stigma discourages employees from seeking help. Negative stigma about mental illness also deters employers from taking steps to encourage care seeking.
So what are the actual costs of depression?
The costs of this neglect on businesses worldwide, plus the global economy, are tremendous. Instead of growth, businesses face an ineffective and inefficient workforce. Here are seven key losses you may see in your company:
1. Costs to the bottom line. A US study reported that in the US, $31 billion is lost annually on work productivity due to depression alone with an estimated cost per employee with depression at $109 nationally.
2. Absences. Depression results in 26 additional absence days per year over and above the amount of non-depressed employees.
3. Impaired Work Performance. The average amount of time employees spent with impaired work performance, or presenteeism, was between 13-29% in a two-week period.
4. Turnover. It costs an average of $4000 to replace an employee and employees with depression are more likely to leave the labor market more frequently than non-depressed employees.
5. Disability. For short-term disability claims, employees with depression claimed an average of 12 more covered absence days than those without depression. In the case of long-term disability, employers may bear all or part of the risk in terms of premiums and benefits payments.
6. Family & Friends. The pressures on family and friends is also high with 18.2% of the US population serving as unpaid caregivers. They consequently work fewer days with lower at-work-productivity.
7. Health care. The increment cost of care for someone with depression was $10,836. Also, those with co-morbid conditions, annual costs were twice the amount of non-depressed employees.
These costs add up. In order to beat the deficit, workplaces need to balance the books and address the negative effects of depression. We provide tools for members of One Mind at Work to tackle these costs and issues.
In Part 2, we’ll review a simple way to calculate exactly how much depression is costing your company and what to do to minimize these costs to help your business soar.