Presenteeism costs 4.2% of GDP

Presenteeism, being physically present at work but mentally absent and unproductive due to illness, injury, stress or burnout, comes at a greater economic cost than absenteeism, and during the COVID-19 pandemic, it has not only increased but gone digital and virtual.

Employees who show up and attempt to work despite their poor mental health cost South Africa almost seven times as much in lost productivity as employees who are absent due to depression. The cost of mental health-related presenteeism has been estimated at R96 500 per employee annually, totalling R235 billion or 4.2% of GDP, versus R14 000 per employee and R33 billion annually for absenteeism.1

 

Prof. Renata Schoeman, head of the MBA in Healthcare Leadership programme at Stellenbosch Business School, said that presenteeism came not only at an economic cost but at a cost to mental health, leading to burnout and other conditions due to not being treated properly.

She said the problem of presenteeism had increased and also shifted to “e-presenteeism” with the rapid shift in working patterns, especially remote online work and flexible schedules, during the COVID-19 pandemic.

Speaking during Corporate Wellness Week from 4 to 8 July, which aims to raise awareness and improve wellness practices in the workplace, she said that at the same time there has been a sharp increase worldwide in stress levels, decreased sense of wellbeing, and mental health conditions such as depression and anxiety.

 

Prof. Schoeman highlighted solutions to presenteeism, including addressing organisational culture and toxic working environments which prize working longer hours and employees being “always on”, and instead modelling and valuing healthy behaviour, logging off and better work-life balance. Flexible hours for illness, reviewing sick leave policies and instituting work-from-home absenteeism policies, as well as valuing output over time input, are also recommended, she said.

A recent report on employees’ mental health in the UK2 found that presenteeism was the largest contributor to employers’ costs of mental health, at approximately £26 billion (R500 billion) in 2021, about 4.5 times the cost of absenteeism. The costs to employers of poor mental health leading to absenteeism, presenteeism and staff turnover increased by 25% in the UK during the pandemic, compared to 2019, with presenteeism remaining the highest cost of the three.

 

“In ‘normal’ times, poor mental health and various personal and work stress factors are key underlying causes of presenteeism, with people often feeling pressured to show up even though they are not fit for work.

“Now, in the era of COVID-19, with increased fears of job security and heightened scrutiny by managers of remote working employees, the pressure to be virtually if not physically present, to be ‘always on’ and prove that one is productive while working from home is even greater. This goes along with increased financial stress, concerns for their own and loved ones’ health, and juggling home and childcare responsibilities, so that people are finding it harder to switch off and set clear boundaries between their work lives and their home and personal lives,” Prof. Schoeman said.

 

Signs that an employee is engaging in e-presenteeism include lower levels of productivity, more mistakes or a lower standard of work than usual, a lack of care about results and output, starting late or finishing early, or putting in more hours but less output, and looking tired or exhausted in virtual meetings.

Presenteeism affects employees at all levels, Prof. Schoeman said, and in the physical work environment can lead to accidents as well as spreading disease when people who are physically ill come to work.

 

“At lower levels, people are often working with dangerous machinery, working night shifts or working as long-distance drivers. Stress, anxiety and depression affects the ability to concentrate and so they are more prone to accidents, with potentially costly or even fatal results.”

“For those at executive level, the impact on judgement and decision-making ability of poor mental health can have serious consequences for the organisation.”

Remote and online work and working from home present numerous new managerial challenges, Prof. Schoeman said, and also make it more difficult to pick up problems such as presenteeism.

 

Her recommendations for avoiding e-presenteeism are:

  • Reassure staff that their health and wellbeing is a priority and that if they are genuinely ill, they should take the needed time off. Make it clear that the company expects sick employees to take the time off to recover, even if they are working from home.
  • Have regular one-on-one check-ins with employees, even if it is a virtual check-in, and create a supportive conversation where employees feel comfortable to speak about their wellbeing and stress levels. An open, trusting relationship means employees are more likely to disclose any mental health challenges that they are struggling with before they develop into more serious conditions.
  • Encourage employees to sign off, close their laptops and take time for a leisure activity at the end of the remote working day.
  • Review sick leave and absence policies and procedures, and adapt them for the world of online and remote work. Consider allowing for a “mental health day” over and above formal sick leave.
  • Ensure that sick leave policies and pay are adequate, in order to help curb presenteeism caused by the financial worries of losing income.

“Consider the cost of adequate sick pay against the cost of an unproductive ‘presentee’ employee.”

  • Train and encourage managers to lead by example in promoting healthy working habits and having boundaries rather than an ‘always on’ culture.“If managers don’t switch off themselves when they are not well, staff will also feel pressured to work when they shouldn’t be.”
  • Reward and recognise output and results rather than hours worked.
  • Encourage employees to take their annual leave.
  • Review workplace wellness initiatives. These could include discounts on gyms and fitness programmes or online fitness and healthy living apps, employee assistance programmes, mental health “first aiders” for first-line counselling, or offering talks and workshops on work-life balance, and resources to manage their physical, mental and financial wellness.

 

NOTE: Costs in this 2016 article were given in US Dollars. Converted to Rand at the current exchange rate.

References
  1. Evans-Lacko S, Knapp M. Global patterns of workplace productivity for people with depression: absenteeism and presenteeism costs across eight diverse countries. Soc Psychiatr Epidemiol. 2016;51(11):1525-37. https://doi.org/10.1007/s00127-016-1278-4.
  2. Deloitte. c2022. “Mental health and employers. The case for investment – pandemic and beyond.” Available from: https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/consultancy/deloitte-uk-mental-health-and-employers.pdf.