The business benefits of mental health are significant.
Creating the conditions for employee mental health and wellbeing is the right thing to do for many reasons, but among them are the significant business benefits. In addition to the advantages for people, the paybacks for organizations and economies are undeniable.
Improved employee mental health is good for business—fully eight scientific studies prove it—from the University of California to the University of South Australia and published in journals of economic studies to occupational studies.
Good business requires balancing multiple issues—continuity over time balanced with adaptability as well as clear and compelling leadership direction balanced with participation and input from employees. And perhaps most of all, strategic choices about the right investments for payback to business, people, customers and communities.
Organizations can’t invest in everything—so it’s reasonable to assess where to put time, energy and resources. And the evidence is clear that programs, processes and systems which support both physical health and mental health are very good business.
Overall Economic Benefit
Starting with the big picture, employee mental health costs the economy at least as much as physical health, according to a study by Penn State, published in the Review of Regional Studies. Specifically, a single extra poor mental health day in a month was associated with a 1.84% drop in the per capita real income growth rate, resulting in $53 billion less total income each year.
Business Benefits
But beyond the overall economic impact, organizations can make strategic investments in mental health and wellbeing which impact their outcomes. These are some of the proof points.
- Organizations which invested in wellbeing—both physical and emotional—saw a 5% increase in productivity based on a meta-analysis by the University of California, Riverside. And each dollar spent on wellness programs saved $3.27 in health care costs and $2.73 in absenteeism costs.
- Organizations that addressed physical health and mental health experienced reduced absenteeism, reduced presenteeism (people who were present at work, but not productive) and increased job performance, according to a study published in the Journal of Occupational and Environmental Medicine (JOEM).
- Programs which enhanced people’s ability to manage work and life responsibilities saw a positive ROI of $1.68. In other words, for every dollar spent on programs to reduce work-life time conflicts, organizational costs dropped by $1.68 based on reduced employee turnover, reduced presenteeism and reduced health care use. This was according to a study by the American College of Occupational and Environmental Medicine (ACOEM).
Taking action to support physical and mental health matter most.
Of course, when people are healthier both physically and emotionally, they can contribute more fully and invest more energy in their performance. These studies demonstrate the impacts on people.
- Toxic leadership was found to increase depression on the part of workers, according to British Psychological Society (BPS). And on the flip side, leadership characterized by empathy, trust, integrity and positive relationships with employees was linked with retention and productivity according to a meta-analysis of 130 studies by University of Exeter.
- Long working hours and a lack of psychological safety resulted in a threefold increase in risk of depression for employees, based on research at the University of South Australia.
- And when workers had more flexibility and control over their work content and working hours, they reported greater wellbeing and job satisfaction, according to a study of 20,000 employees by the University of Birmingham.
Strategies That Work Best
So based on the studies, which strategies make the most difference for people? They intersect because physical health affects emotional wellbeing and vice versa, but it is possible to isolate the primary factors which matter most.
#1 - Support Physical Health
In the studies, programs which offered testing for physical conditions and training and coaching for physical wellbeing, resulted in significant payoffs. The study in JOEM found that attending to blood pressure, chronic pain, dietary habits and exercise regimens had positive outcomes for business. In addition, the University of California study found that benefits resulted when wellness programs discovered an undiagnosed illness and positively affected people’s diet and exercise approaches.
People can contribute better when they’re healthier, but researchers also found when companies supported physical health, employees felt grateful and motivated based on appreciation for the company’s efforts.
Leaders affects mental health and—in turn—business outcomes.
#2 - Provide Choice and Flexibility
Another primary way to get great results is to provide systems for employees who are navigating work and family responsibilities. Specifically, giving people control over their work time and developing leaders so they provide support for employees. In addition, it’s effective to ensure the work culture emphasizes results rather than simply face-time in meetings or the office. All of these were part of the study by ACOEM.
In addition, you can provide people with greater autonomy, choice and control. As much as possible, give employees control over their work location and working hours. In addition, provide more choice over job tasks, the pace of work and how tasks are performed. The University of Birmingham study proved these tactics.
And according to the study in the JOEM, people reported greater mental health when they felt like their strengths were used in their roles. People want to make a difference, and express talents through work that matters—so matching skills and roles contributes to mental health.
Overall, treat people like grownups and give as much autonomy as possible, balanced with the requirements of the job, the team and the organization.
#3 - Ensure Great Leadership
Another significant way to drive business benefits through better wellbeing and mental health is to develop leaders, hold them accountable and ensure they are building positive relationships with employees. When employees have enhanced relationships with supervisors and when leaders were supportive of employees, benefits ensued—based on research by ACOEM. And according to University of Exeter research, when leaders demonstrate empathy, build trust and treat people fairly, it pays off for organizations.
In addition, the BPS study found bad behaviors on the part of leaders—like taking credit for employees’ work, being overly critical, behaving aggressively, taking advantage of others or bullying had significant negative effects. People also need to trust leaders and have a sense of psychological safety, according to the University of South Australia study.
The bottom line: Poor leadership compromises wellbeing, performance and outcomes. Positive leadership is correlated with better health and great results.
The Importance of Culture
All of these elements—programs for physical health, policies which emphasize choice and actions by leaders—are reflections of an overall culture which values people. Employees take cues from all the factors which are apparent to them in a culture—from behaviors and norms to the values which are evidently driving them.
You’ll want to support people because it’s the right thing to do. But if you need more of an impetus or if you’re making a business case, the evidence is clear—supporting physical and mental health are undeniably good for outcomes—based on performance of individuals, teams and the organization overall.
