Wellbeing at Work Wins: The Organizational Cost

While employers should be convinced to support employee wellbeing purely on the basis that it is the right thing to do, there is also a strong business case. The success of an organization is fundamentally dependent upon the individuals that make up that organization - if employee health dips, so too will the business’ health.

Work and life aren't mutually exclusive (Gallup, 2024). As we saw in the first blog of this series, the boundaries between work and personal life are incredibly blurred in today’s remote world of work. However, this goes both ways - an employee’s personal life will influence their approach to work. As such, the state of an employee's wellbeing has time and time again been seen to inform their approach to employment and work. 

Why does this matter right now?

While the connection between work and life is nothing new, employees' expectations of this relationship are changing. In the post-pandemic work environment, employees are less focused on dedicating their lives to a career and climbing the corporate ladder and are more likely to prioritize employment that allows for more than just financial compensation i.e., flexibility, balance etc. The Great Resignation saw millions of workers voluntarily leaving their jobs, seeking these very things.

We are living in a "worker's market" where labor shortages lead candidates to have more power than recruiters and hiring managers and they are expected to retain that power. Unsatisfied employees are therefore much more likely to look elsewhere instead of sticking it out at an organization that is not meeting their needs. According to Gallup, 60% of Gen Z workers are open to job changes, compared to 45% of millennials. and 36% of baby boomers irrespective of their employment satisfaction level. In fact, employees who are burned out are 3 times more likely to look for employment elsewhere and approximately 15% less likely to commit themselves to their work (SHRM, 2024). 

How does this hurt business success?

The state of your employees when they arrive at work can incur both direct and indirect costs for your organization. 

1. Direct costs: Employee burnout can lead to increased absenteeism, reduced productivity, and high employee turnover, the combination of which translates into a loss of $322 billion globally (Gallup, 2024). 

   1. Employees suffering from burnout are more likely to take preventable sick days leading to missed deadlines, slower work pace and more inconsistency and mistakes due to strained decision-making.

   2. Employees struggling with their well-being, burnout and general satisfaction with the workplace are more inclined to leave the organization resulting in increased recruitment and onboarding costs.

2. Indirect costs: The hidden costs of burnout can be equally damaging to a company's bottom line. In fact, there is $20 million of additional lost opportunity for every 10,000 workers due to struggling or suffering employees (Gallup, 2024).

   1. A workplace full of burnout and dissatisfaction can lead to the development of a toxic work environment, spreading negativity and leading to a domino effect among team members.

   2. There are additional, unseen costs of high turnover rates including the loss of institutional knowledge as well as potential damage to a company's reputation jeopardizing their ability to attract top talent.

How can we leakproof the bottom line?

"Take care of your employees, and they'll take care of your business. It's as simple as that." – Richard Branson

So, how can employers combat these issues? Here are some actionable strategies:

1. Develop a Culture of Open Communication: Employees who feel supported and heard are more likely to be engaged and loyal to the organization. Consider the following strategies:

   1. Hold Regular Check-Ins: Managers should regularly meet with their teams to discuss not just performance but also employee wellbeing, workload, and stress levels.

   2. Implement Anonymous Feedback Channels: Create channels where employees can anonymously report issues or concerns to encourage more honest feedback without fear of reprisal.

   3. Facilitate Peer Support Networks: Encourage employees to support one another, share advice, and offer each other emotional support whether in a dedicated support group or beyond. 

2. Focus on Employee Development: Employees who can see a future at the organization are less likely to experience severe burnout due to a stronger sense of purpose and belonging. Consider the following strategies:

   1. Offer Professional Development: Encourage a culture of continuously learning through training programs and mentorship opportunities.

   2. Provide Soft Skills Training: Run workshops on resilience, time management and stress reduction techniques to help employees adapt to changes and manage their workload effectively.

   3. Encourage Career Advancement: Create clear, transparent paths for career progression to avoid frustration over feeling "stuck" in their roles.

3. Implement Recognition and Rewards Programs: Recognition helps to boost individual employee engagement, increase productivity and support ongoing loyalty to the company. Consider the following strategies:

   1. Formal Awards Programs: Create formal recognition programs, such as an Employee of the Month award, where employees can feel regularly celebrated for their achievements. 

   2. Public Recognition: Regularly acknowledge employee contributions during team meetings, company-wide updates, or newsletters.

   3. Tailored Rewards: Personalized recognition is even more effective as it shows that the company knows and values its employees as individuals.

The “Great Gloom” is not only casting a long shadow over individual employees but also the organization as a whole. With both the direct and indirect costs rising, now is the time to act as the ripple effect does not stop here. The next blog in this series will explore the customer experience crisis as a result of an environment of poor wellbeing and burnout and the risks that this poses to business success.