How does health affect productivity?

In simple terms, only when employees are happy and healthy can they work to the best of their ability. So, when an employee is suffering from a health issue, be it physical or mental, that has a direct impact on how productive they are at work.

This results in two key issues that employers face: absenteeism and presenteeism. Absenteeism refers to when employees miss work due to ill health, presenteeism, meanwhile, is when employees come into work but are suffering from ill health.

The impact of employee health on productivity is an increased cost to your business, and these costs are significant. A 2023 study found that the total cost to the UK economy of lost output among working-age people due to ill health is around $180 billion per annum, equivalent to 7% of GDP. Of this cost, productivity is by far the most significant aspect; while sickness absence and informal caregiving are significant factors, lack of productivity is almost twice as costly as the others combined. And these costs are rising - in fact, they have risen by around 60% since 2016, a period of time in which the economy has grown by just 1%. This is why employee health is important.

Physical health and productivity

Having employees with a good level of physical health is crucial if you are to improve employee productivity levels. Physically healthy employees are less likely to call in sick, thus reducing loss of productivity from absenteeism. Furthermore, the healthier an employee, the more likely they will be able to work effectively and efficiently, reducing presenteeism.

Problem - Chronic illness

One of the key factors affecting productivity is the rising chronic illness burden. A recent study from the USA^[1] estimates that over 35% of adults aged 50 and over will suffer with at least one chronic disease by 2035, which is expected to increase to almost 48% by 2050. With this rise, employees are spending more time away from the workplace. Additionally, when these employees do come to work, those suffering are less likely to be able to work as productively as their healthier colleagues.

Solution - Exercise

Exercise has proven to be one of the key methods to remedy the lack of productivity caused by poor physical health. From obesity and type two diabetes to heart disease and cancer, exercise significantly reduces the risk of suffering from these debilitating conditions. Exercise has a positive domino effect – exercise itself improves overall health^[2], increases the quality of sleep, and thus improves morale and level of motivation to approach work the next day.

And of course, physical health is also closely tied to mental health.

Mental health and productivity

How does mental health affect work performance? Well, a study has shown that poor mental health costs UK employers up to £56 billion a year^[3], a cost that has increased by around 25% since 2019. While poor mental health can be caused by several factors, both in an employee’s personal life and in the workplace, what is certain is the affect it has on productivity.

Problem - Workplace stress

Not getting on with colleagues, intense deadlines, pressure from seniors and other factors can all lead to workplace stress and anxiety. This can affect an employee’s confidence and consequently their capacity to work effectively, increasing their absences from the office or indeed increasing presenteeism. This is a significant problem that is felt worldwide. The WHO estimates that twelve billion working days are lost every year to depression and anxiety alone, costing the global economy $1 trillion^[4], highlighting the importance of a healthy working environment.

Solution - Mental health support

As a business, the first step is recognizing that your most important asset is your people. Investment in mental health support, whether this be time or financial, can have a hugely positive impact on employees’ lives and their ability to work optimally. Encouraging exercise and access to natural light also ties into this: a healthy body supports a healthy mind.

How to increase productivity in the workplace

So significant is the impact of employee health on productivity that the costs pose a serious risk of inflicting long-term scars on employers and the wider economy. In this context, measures to promote health in the workplace and prevent absenteeism and presenteeism should be an absolute priority for management.

Provide insurance with physical and mental health cover

• Companies that support health and wellness have a greater percentage of employees at work every day ^[5]. Well-being is physical and mental, and only by supporting both can companies achieve more consistent workflows and increase productivity.
• The Cigna Healthcare Vitality Study 2023 found that health insurance plans are the most popular element of health and well-being programs among employees.

Promote a healthy work/life balance

• Encouraging employees to switch off when they are away from work will help reduce stress and improve mental health, allowing them to work more effectively.

Implement a workplace wellness program

• Employees need the space to nurture their well-being. This will improve their health but also increase their motivation to work by feeling they are valued and appreciated.

Launch workplace health education and awareness campaigns

• Colleagues can join together for Dry January or begin a group running challenge. By partaking together, colleagues will become healthier while also creating a strong workplace culture. Getting employees physically active can cut company healthcare costs and help them bring their best selves to work.