New mental health research from Deloitte has revealed that the cost to employers of poor mental health has increased, to up to £56bn in 2020-21 compared to £45bn in 2019.*
The great resignation
The overall increase in total costs is due to higher staff turnover. Deloitte’s survey found that 28% of UK employees either left their job in 2021 or they are planning to leave it in 2022, with 61% of respondents saying this was due to poor mental health.
Young people (18-29 years old) were found to be most likely to have moved jobs or be considering a job move. One in five (21%) young people surveyed said they were planning to leave and one in four (24%) said they had intentionally left their job in the past 12 months. Of those who had intentionally left or planned to leave their job, two in three (65%) said this decision was driven by poor mental health.
Elizabeth Hampson, Deloitte director and author of ‘Mental health and employers: the case for investment – pandemic and beyond’, said: “We have seen poor mental health costs UK employers up to £56 billion a year, based on a new Deloitte survey, an increase of 25% in the cost of poor mental health to employers compared to 2019. Mental health issues are a strong driver for the ‘Great resignation’. Long hours, increased stress and job insecurity have had a detrimental impact on quality of life during the pandemic. People are leaving their jobs, re-evaluating their careers and changing occupations in large numbers.
“Burnout among employees, such as feelings of exhaustion, mental distance from the job and reduced job performance, have been more evident during the pandemic. Measures by employers to improve mental wellbeing should not only benefit employees themselves but should also reduce employment costs such as recruitment costs and provide broader societal benefits.”
Jackie Henry, managing partner for people and purpose at Deloitte UK, said: “Wellbeing must become a strategic priority for organisations of every size – not only to support employees experiencing anxiety and stress, but also to prevent people from becoming overwhelmed and overworked in the first place. Covid-19 has given us an opportunity to tackle stigma and improve awareness. Leadership should set the tone at the top: whether continuing to invest in training to help managers and employees spot signs of poor mental health and understand how to reach their employees and help.”
Emma Mamo, Head of Workplace Wellbeing at Mind, said: “It’s shocking but not surprising that the cost of poor mental health to employers is now up to a huge £56 billion per year. We know that the pandemic has taken a huge toll on the mental health of the nation, including our colleagues. A 2021 survey by Mind of over 40,000 staff working across 114 organisations taking part in our Workplace Wellbeing Index revealed that two in five (41 per cent) employees said their mental health had worsened during the pandemic.
“The lockdowns and restrictions gave lots of us more time to think about what we wanted from our lives and our careers, and as a result more of us decided to leave or move jobs. Recruiting and retaining talent is hugely important to employers, and we know employers who invest in staff wellbeing are more likely to report having staff who are happy, productive and less likely to leave. This latest report from Deloitte suggests employers see a return of £5.30 on average for every £1 invested in staff wellbeing so it’s never been timelier to prioritise staff mental health, especially given staff are once again adjusting to new ways of working, with many employers trialling hybrid working.
“Mind can help employers of all sizes and sectors to create mentally healthy workplaces, including through our training and the resources available via our website.”