A report by Cebr highlights the severe economic impact of long-term sickness absence on UK businesses, costing £4.17 billion annually.
- Mental health issues significantly contribute to these costs, accounting for £1.17 billion each year due to lost workdays.
- The burden of long-term sickness absence has grown since 2012, with anticipated increases by 2030 due to an ageing workforce.
- Proactive measures, such as early intervention and vocational rehabilitation, can substantially reduce the duration and cost of absences.
- Group Income Protection plans can further offset financial losses, offering additional returns through preventive support services.
A report from the Centre for Economics and Business Research (Cebr) reveals that long-term sickness absence costs UK businesses a staggering £4.17 billion annually. A major contributing factor is mental health issues, which lead to over 70 million lost workdays each year, incurring costs of £1.17 billion.
The financial strain of long-term sickness absence is increasing, rising from £3.13 billion in 2012. As workforce demographics shift towards older employees, these costs could reach £4.81 billion by 2030, marking a 15% rise.
Businesses are advised to adopt early intervention strategies to manage health issues before they escalate. Evidence shows that using vocational rehabilitation services early can decrease average absence durations by 17%, with even more significant impacts on mental health-related absences.
Adrian Lewis, an absence management expert, notes the common reliance on manual records for tracking absences, which often delays effective intervention. He highlights a growing shift towards technological solutions that enable early detection and targeted wellness initiatives.
Financial mechanisms such as Group Income Protection (GIP) can mitigate some costs. For every £100 spent on GIP premiums, businesses may see a return of £61 from reduced Occupational Sick Pay and related expenses. Crucially, integrating early intervention services within GIP can boost this payback, providing an additional £270 million to UK businesses annually.
The findings underscore the importance of early intervention and structured support in mitigating the economic impact of long-term sickness absence on businesses.
