Sometimes I’ve gotten so busy, felt so overwhelmed, that I’ve wished the world would just take a timeout…just stop long enough for me to catch up.
I’ll never wish that again.
Last fall, we started a new research study titled Next Practices in Holistic Well-Being at the request of CHROs and heads of Total Rewards with whom we work. Initially, it was innocently focused on an area growing in importance for attracting and retaining top talent. In fact, a large percentage of job applicants say health insurance is either the deciding factor or a positive influence in choosing who to work for, and an even greater percentage say that health coverage is a key factor in deciding to stay at their current job.
Of course, that was well before most even knew what a coronavirus was.
How quickly things change. Almost no company had contingency plans in place for a worldwide pandemic which caused far too much loss of life…and life as we know it to come to a screeching halt. In addition to disrupting most aspects of organizations, this pandemic has also severely tested our employer-sponsored health and wellness programs and is likely to have a big impact in the future. New analysis from Willis Towers Watson suggests that U.S. employers could see their healthcare costs increase up to 7% this year due to coronavirus treatment and testing costs—on top of the 5% increase companies had already projected before the pandemic.
You likely already know that employer-sponsored healthcare is a huge business, but you might not realize how big it is. In the United States alone, healthcare as a percentage of GDP has increased from 5% in 1960 to over 18% today, and it has become a $3.5 trillion dollar industry. Organizations are the largest single provider and purchaser of health insurance in the US, covering over 150 million workers and their dependents.
Despite the spend, we need to do more.
Employees continue to struggle with health-related issues, and unfortunately the job is often the culprit. In his excellent book Dying for a Paycheck, Stanford business professor (and i4cp Thought Leader) Jeffrey Pfeffer outlined some grim statistics about today’s workforce.
“In one survey, 61 percent of
employees said that workplace stress had made them sick and 7 percent said they
had actually been hospitalized. Job stress costs US employers more than $300
billion annually and may cause 120,000 excess deaths each year. In China, 1 million
people a year may be dying from overwork,” Pfeffer wrote. That makes workplaces
“the fifth leading cause of death — and [they] account for about [US]$180
billion in additional healthcare expenses, approximately 8 percent of the total
“People are literally dying for a paycheck. And it needs to stop.”
Pfeffer and his colleagues estimate that about 60 thousand, or half of these deaths, and about $63 billion, or about one-third of the excess costs, might be preventable. Many organizations understand this, and we’ve seen a shift over the last few years from straight wellness programs to holistic well-being programs.
Next Practices in Holistic Well-being
In the new study, which we will make available publicly May 12 and previewed in a webinar this Tuesday (watch a recording here), we found that high-performance organizations—those excelling over time in revenue growth, profitability, market share, and customer satisfaction—embrace the holistic approach. These top companies focus on the physical and (especially) the emotional/mental elements of well-being at rates up to 4x that of lower-performing firms, but they also emphasize employees’ financial, community, career and social well-being. These top companies, as a result of an adoption of holistic well-being, also report having:
- A healthier workforce
- Lower benefits costs
- Better attraction and retention of talent
- Improved productivity
- Less absenteeism
- Overall better financial performance
Even before companies reopen their doors as the pandemic subsides, attention to mental and emotional health is going to be paramount. There’s a lot of room for improvement in this area, however. Our study found that only 15% of all organizations feel they are highly effective in addressing employees’ mental health needs, though the percentage more than doubles in high-performance firms.
Successful well-being programs usually establish a “culture of health” throughout the organization which ultimately benefits the employer brand. Nearly all (89%) workers at companies that support well-being initiatives are more likely to recommend their company as a good place to work. In organizations where employees do not view leadership as committed to their well-being, only 17% would recommend the company as a good place to work.
These statistics outline what most instinctively know: commitment to employee well-being pays off. Now that organizations have experienced a global pandemic, the ramifications for employee well-being will extend far beyond physical health and into their emotional and mental health, along with financial, career, community and social well-being. While the COVID-19 pandemic has wreaked havoc on our world, one positive outcome will be that the attention to improving holistic well-being will never be greater.
I hope companies utilize this pandemic to improve their
well-being programs. If you haven’t
already started, the time to do so is now. We can’t count on the world stopping
again in the future to give us time, and we certainly need to be better
prepared if it ever does again.
Kevin Oakes, CEO, i4cp