Mental health affects the productivity and engagement of Canadian workers, whether they take a leave of absence or not. But according to an analysis by Deloitte Insights, every dollar spent on workplace mental health initiatives comes with a surprisingly immediate return on investment.
Companies with mental health programs in place for one year reap a median annual return on their investment of $1.62 for every dollar spent. As those same programs mature over three or more years, that figure grows to $2.18 for every dollar spent.
The bottom line is that what’s good for workplace mental health is also good for a company’s bottom line.
“There’s both an economic and moral imperative for Canadian employers to take action, recognizing that the cost to the Canadian economy of poor mental health in our workplaces is estimated to be $50 billion annually,” said Anthony Viel, Chief Executive Officer at Deloitte Canada in a press release.
“The findings from this report provide a business case that is impossible to ignore. Organizations committed to delivering and measuring impactful employee wellness programs are creating healthier workplaces and seeing investments in their people’s mental health pay off.”
The report explores data from seven Canadian companies that have had mental health programs in place for at least three years, and includes anecdotal evidence from three others: Air Canada, ATB Financial, Bell, Canada Life, CIBC, Desjardins Group, Enbridge Inc., Energir, Husky Energy, and Morneau Shepell. For comparison, the study used baseline data from the year that the programs were set to begin.
The evidence validates that investing money in mental health is a benefit for everybody, and not just a cost for employers to bear. The report gives employers the roadmap they need to make evidence-based decisions on the most effective mental health strategies, and ways to measure and track the benefits.
It’s becoming increasingly clear that the cost of doing nothing is hurting productivity. Workplace pressure is the number one source of stress for Canadians, and about a third of all short-term and long-term disability claims in Canada stem from mental health conditions. This translates to about 70 percent of workplace disability costs.
But absenteeism is only one part of the big picture. Presenteeism, or working while unwell, has an estimated cost of $6.4 billion a year across Canada. This includes not only the cost of lost productivity and therapy or medications for mental illness, but also the direct negative impact on a host of other chronic illnesses like cardiovascular disease and asthma.
The report outlines four major recommendations for companies:
- Invest in proactive programs to promote mental health: Treatment is only one part of the package. Interventions that also encourage mental wellness before workers reach crisis levels will deliver the most impact. These might include sponsored exercise or meditation programs. Companies that target the full spectrum of mental health to include general well-being, intervention and care, and proactive elimination of major sources of workplace stress are more likely to get a positive return on their investments.
- Prioritize high impact areas: Leadership training, employee and family assistance programs, psychological care benefits, and return-to-work programs are areas that companies should put at the top of their lists.
- Track key performance indicators: Calculating the financial and non-financial benefits of mental health programs starts by collecting the relevant data.
- Use data analytics to evaluate and adapt: Checking the impact and adoption rates of specific programs helps companies adapt and maximize the impact of their investments.
Notably, companies that want to get involved don’t need to start from scratch. Canada’s National Standard for Psychological Health and Safety in the Workplace was published in 2013, and this pioneering framework includes actionable steps based on best practices. It’s a voluntary program, but a third of companies are already taking action.
Employers are rightfully concerned about mental health in the workplace. Better policies and programs lead to higher employee retention, and they can also help attract top talent. People are looking for balance, positive work environments, and excellent leadership that helps them produce their best work.
These frameworks will guide employers to improve their policies and programs, shifting workplace culture to prioritize mental health in the same way that it protects physical health. The positive impact on workers ripples out into every aspect of their lives and interactions with family and community, making it an important step for the well-being of our entire society.