Cost Savings for Employers
It Pays to Invest in an Employee Assistance Program
Employees' Personal Problems are Costly
- 55-75% of all illnesses are thought to be stress related.
- Two out of three employee problems originate in personal issues.
- 15% of American workers abuse drugs and alcohol.
- Alcoholics use medical care three times more than non-alcoholics.
Sources: EAPA, EAP Digest, Health Insurance Association of America, Alcoholism Magazine
For only a few dollars per employee per month, your organization can benefit from a significant return on your EAP investment. Employee Support Network is an employee assistance program that saves money by helping employees resolve personal issues that may impact their work performance. Having an EAP available as a resource for your company enhances the work climate by promoting the health and well being of everyone involved.
The following statistics illustrate the benefits of EAP to business:
- Employers utilizing an EAP save anywhere from $5.00 to $16.00 for every $1.00 they invest (USDL, What Works: Workplaces Without Drugs, p.17).
- Companies that help employees juggle the demands of work and family will be the biggest winners in the competition for good employees. (Aon Consulting, 2000)
- Eighty eight percent of employees say they have a hard time juggling work and life. (Aon Consulting, 2000)
- Workers rate the ability to manage work and family as the most important aspect they look for in a job. (Rutgers University and University of Connecticut)
- Employers, who have an EAP, save money through better productivity, fewer absences, lower staff turnover, and lower health costs. More than 90% of Fortune 500 companies use EAPs, because a company's best assets are its people. Healthy employees are a critical link to a company's success. (Janette Bennett “Helping Staff Deal with the Pressures of Life”, Sunday Times: Business Times, 10.17.99)
- General Motors Corporation has reported a $2.00 to $1.00 payoff for its EAP services.
- McDonnell Douglas saved $5.1 million according to a four-year study, a return of $4.00 for every $1.00 invested.
A typical business can expect an EAP to provide them with the following general benefits:
- 33% reduction in the use of sick benefits
- 65-70% reduction in work related accidents
- 34-78% reduction in absenteeism
Sources: McDonnell Douglas, GM, Kimberly-Clark and AT&T.
Specific benefits to business and to employees are further detailed below:
- Personal illness accounted for 45% of absenteeism in 1995.
- Data from 1995 shows that unscheduled absenteeism cost employers as much as $668 per employee per year.
- Dealing with family issues caused 27% of unscheduled absenteeism in 1995.
- Psychological problems cause 61% of yearly absenteeism (as well as 65-85% of employee terminations and 80-90% of industrial accidents).
- Most frequent reasons for missed workdays are:
- Sick time
- Caring for a sick child
- A need to resolve personal matters
- Care for elder parents
- Lack of day care
Source: Life Guidance Services, EAPA
In a survey in “Managed Health Network”, in June of 1995, Roper Starch Worldwide Inc. polled over 500 US companies' Human Resource professionals and 500 employees. Some results were:
- 92% of Americans agreed that personal problems spill over into work decreasing productivity.
- 60% of American workers stated they had experienced stress-related problems.
- 79-86% of Americans felt that support programs can help employees with personal problems.
- 66% believed employee personal problems harmfully affected attendance at work.
- 63% thought that productivity was negatively affected by employee personal problems.
- 61% felt that an employee's emotional well-being was strongly affected by personal problems.
- Personal problems employers' considered harmful to productivity were:
- Stress-related problems - 88%
- Drug addiction - 87%
- Alcoholism - 87%
- Depression - 86%
- Problems with partner or spouse - 83%
- Sickness or death in the family-82%
- Problems with children-82%
- There has been a significant increase in dual career families. Almost 60% of workingmen have wives working outside the home.
- Parents miss work or are late to work an average of once every three weeks because of childcare responsibilities.
- In today's “sandwich generation” employees face both child and eldercare responsibilities as many employees with eldercare responsibility also have children under 18.
- The annual cost of caring for elders includes both a financial component and an emotional/stress component.
- Eldercare cost US business more than $29 billion in lost productivity in 1997 and is expected to grow to $166 billion by 2050.
- Absences due to eldercare are estimated to cost employers'about $3000.00 per employee per year.
Sources: EAPA, E-Eldercare, Inc.
- A growing number of American workers are experiencing financial distress.
- Concern over money problems creates anxiety and stress, which may lead to the additional problems of alcohol, drug and spouse abuse.
- Financial concerns account for 12% of the reasons for lost work time.
- Consumer debt reached $1.47 trillion in July of 2000.
Sources: The 2000 Small Employer Retirement Survey (SERS).
- Workers with alcohol problems generate eight times more medical costs than those without.
- A national average of 15% of any given workforce has problems with substance abuse.
- Alcohol alone cost the U.S. $65.5 billion annually in lost revenue.
- On the job accidents attributed to alcohol and drug use cost $91 billion annually.
- The United States Department of Health and Human Services estimates that the cost of alcohol and drug abuse to American businesses is $100 billion a year in both tangible and intangible costs.
- The costs of substance abuse and dependency employees as compared to non-abusing colleagues:
- They are 5 times more likely to file a workers' compensation claim.
- They have unexcused absences from work twice as often.
- They are late to work three times as often.
- They ask to leave early twice as often.
- They are more likely to steal from the company or be involved in workplace accidents.
Sources: U.S. Department of Health and Human Services, and Fred Hafer “The High Cost of Doing Nothing” from “Substance Abuse Prevention in the Workplace: An Employer's Guide,” produced by Thirteen/WNET's Educational Publishing Dept.
- Stress costs American employers approximately $200 billion a year in absenteeism, lower productivity, rising health and workers compensation costs, and other expenses.
- The International Labor Organization characterizes work stress as the disease of the modern workplace.
- Between 75-90% of visits to primary care physicians are related to stress.
- Two out of ten people suffering clinical depression begin with stress.
Sources: Life Guidance Services, EAPA, and EAP Digest
- Depression is now the second most disabling illness after heart disease. It affects one in 10 working-age adults.
- According to the Surgeon General David Satcher, mental illness will affect one out of every 5 Americans in their lifetime.
- The International Labor Organization reports the estimated economic cost of depression to be $44 billion in the US.
- The ILO predicts that within 20 years mental, neurological, and behavioral disorders will outrank traffic accidents, AIDS and violence as a primary cause of work years lost from early death or disability.
Sources: Bob Weimer, “The World Economy is Driving People Mad”, Newsday, 10.16.00; Fisher Vista, Inc.
Call Stacey O'Connell, LCSW at Employee Support Network. (631) 240-4557.