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Companies are under attack! Not from rising energy costs, foreign competition, or regulatory pressure, but from a steady decrease in employee health & happiness. The "weight" of this problem is falling on the bottom lines of companies in the form of rapidly increasing costs and rapidly decreasing employee productivity and engagement. Once thought to be an involuntary benefit, Employee Wellness is now being discussed in corporate board rooms all over the world as a critical element of business strategy. HR is expected to understand and manage the risk associated with this problem and create a sustainability strategy that includes health & happiness. This eBook discussed the economics of this fight and how the war talent is now happening in the gym and cafeteria.
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Wellness as aBusiness Strategy
presented by
"The prevention of chronic diseases has been
chronically under funded. As we get older, fatter and
less active, the weight of the world is falling on the
bottom lines of the world's largest companies in the
form of reduced productivity, increased tax burdens
and declining competitiveness."
“Working Towards Wellness: The business rationale,”World Economic Forum in cooperation with PwC, 2008.
Your company is under attack.
The threat isn’t coming from foreign competition, rising energy costs or regulatory uncertainty. It’s coming from within—in the form of obese, sedentary, stressed, unproductive, disengaged and chronically ill employees. The ability to keep employees happy and healthy is now paramount to the success of every organization.
Is your company up to the challenge?
The time for employee wellness is now. The direct and indirect costs associated with unhealthy employees is so great that aneffective employee wellness program is no longer a voluntary benefit or a “nice to have.” It’s a business strategy.
The caloric value of what’s on employees’ plates directly impacts the shareholder value you’re able to create.
Total economic cost of obesity (U.S & Canada) = $300B.
Obesity costs U.S. employers an estimated 150 billion in lost productivity.
Obese workers miss 450 million more days per year than healthy employees.
$300B
450M
$150B
Employers pay 42% more in medical costs for obese employees.more medical costs
cost of obesity
more days missed
lost productivity cost
of Americans are obese
42%1/3
Is a balanced diet on your balanced scorecard?
1
2
3
4
5
32%
They don’t make compact fluorescent employees.
increase in electricity needed to power this lightbulb in the past 5 years.
increase in employer health costs during those same five years. 76
18%
Two all beef patties, special sauce and nearly 2x the price increase of electricity!
Your organization is sitting still. Literally.
Dilbert was not “big-boned.”
20% of today’s jobs require amoderate level of activity, as compared to 50% in the ‘60s. 8
Only
10Bus drivers are twice as likely to die
of a heart attack as ticket takers. 94% 48%women who sit for over 6hrs/day are
men who sit for over 6hrs/day are
more likely to die.
Ticket takers(standing)
Bus drivers(sitting)
in stress-related costs to U.S. businesses each year.
$300B
Absenteeism Employee turnover
MedicalInsurance Premiums
Worker’s compensationLawsuits
Diminished productivity
Stress & depression & recession. Oh my.
Employers pay 50% moreper year in health costs for stressed employees.
Employee stress
of Americans are stressed
at work.
77%
11
11
12
$370 BillionActively disengaged employees annually cost the U.S.
The high cost of low employee engagement
13
54%of employees plan to leave when the
economy improves. 14
27%of employees are actively engaged. 14
54%of disengaged
employees report that work has a
negative impact on their health. 15
58%of companies cite
low employee engagement as the biggest obstacle to behavior change. 16
Fortune’s “100 Best Companies to Work for” take employee health seriously. Shouldn’t you?
The war for talent is happening in the gym.
67
40
3020
10 0
70
94 9783 100
110
120
130
140
87
On-site fitness center
Subsidized off-site gym membership
Regular on-site cholesterol screenings
Regular on-site blood pressure screenings
Pre-tax flexible spending account
Regular on-site flu shots97Number of the 100 best companies to work for that offer...
94
83
87
70
67
17
It’s time to rethink your strategy pyramid and elevate HR’s role.
Ask yourself these three questions:
If the answers are “yes”...
1. Are the results of your organization dependent on the aggregate performance of the individual employees?
2. Are happy & healthy employees more likely to perform at a high level?
3. Is HR’s role to maximize ROI on the company’s human capital and reduce financial risk?
Employee Wellness
Functional / Departmental
Business Unit
Corp
...Maybe your strategy pyramid should look like this.
Wellness is a business strategy.
Endnotes1 “Adult Obesity,” Centers for Disease Control and Prevention, http://www.cdc.gov/obesity/data/adult.html
2 Willingham, Jacqueline G, “Managing Presenteeism and Disability to Improve Productivity,” Benefits & Compensation Digest, 45.12, Dec. 2008.
3 “Unhealthy U.S. Workers’ Absenteeism Costs $153 Billion,”GALLUP, Inc., 17 Oct. 2011, http://http://www.gallup.com/poll/150026/unhealthy-workers-absenteeism-costs-153-billion.aspx
4 Miller, Melissa, “Obese Employees Costing Companies,”Southeast Missourian,21 Sept. 2011, http://http://www.semissourian.com/story/1765329.html
5 “Obesity and its Relation to Mortality and Morbidity Costs,”Society of Actuaries, Dec. 2010, http://www.soa.org/files/pdf/research-2011-obesity-relation-mortality.pdf
6 Average prices for electricity, United States, October 2006-October 2011, Mid-Atlantic Information Office, U.S. Department of Labor. http://www.soa.org/files/pdf/research-2011-obesity-relation-mortality.pdf
7 Kaiser/HRET Employer Health Benefits 2011 Annual Survey. http://ehbs.kff.org/
8 Parker-Pope, Tara, “Less Active at Work, Americans Pack on Pounds,” The New York Times, 25 May 2011, http://well.blogs.nytimes.com/2011/05/25/less-active-at-work-americans-have-packed-on-pounds/?ref=health
9 Butler, Kelley, “The One Thing in Your Office That’s Holding Back Your Wellness Program,” Employee Benefit News, 27 Oct. 2011, http://ebn.benefitnews.com/blog/ebviews/wellness-programs-sedentary-work-health-effects-2719314-1.html
10 Kuper, Simon, “The Man Who Invented Exercise,” FT Magazine, http://www.ft.com/intl/cms/s/0/e6ff90ea-9da2-11de-9f4a-00144feabdc0.html#axzz1NOkg88os
11 “The Cost and Removal of Workplace Stress,” The National Registry of Workers’ Compensation Specialists, http://www.nrwcs.com/cost-of-workplace-stress
12 “Survey Reveals 77% of Americans Stressed About Something At Work,” Everest Career Education Network, 30 Mar. 2011, http://news.everest.edu/post/2011/03/survey-reveals-77-of-americans-stressed-about-something-at-work
13 “Dilbert is Right, Says Gallup Study,” GALLUP Management Journal, 13 Apr. 2006, http://gmj.gallup.com/content/22381/dilbert-right-says-gallup-study.aspx
14 Sheridan, Kevin, “Top 2011 Employee Engagement Trends,”Monster Thinking, 10 Jan. 2011, http://www.monsterthinking.com/2011/01/10/employee-engagement/
15 “Gallup Study: Unhappy Workers Are Unhealthy Too,” GALLUP Management Journal, 13 Jan. 2005, http://gmj.gallup.com/content/14545/gallup-study-unhappy-workers-unhealthy-too.aspx
16 “Boosting Employee Wellness Participation Without Breaking the Bank,” Towers Watson, July 2010, http://www.towerswatson.com/research/2395
17 Erb, Marcus, “Wellness Programs at the Best Companies,”Great Place to Work Institute, http://www.greatplacetowork.com/publications-and-events/blogs-and-news/714-wellness-programs-at-the-best-companies
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