Why is Workplace Wellbeing important?

How we invest in human capital at this time may prove the difference between businesses that stand the test of time and those that do not.  Here are some of the key benefits of investing in the physical and mental wellbeing of your workforce and how that translates into higher productivity.

Better Health, Better Performance
Studies have shown that high wellbeing correlates with many individual traits that influence ability to work cooperatively as part of a team. Wellbeing has been shown to make employees more productive (Roberston, 2011), with those individuals with high wellbeing more likely to be rated as ‘high performance’ by their supervisors and to achieve a better financial performance (Wu, H et al 2016).

Research has also shown that happy workers are healthier workers (Oswald, 2016). Those with higher levels of wellbeing tend to bounce back from negative events faster and experience a lesser decrease in their mental health when encountering a potentially stressful or challenging situation compared to their less-happy counterparts (Tay, L., & Diener, E. 2011).

Lower rate of Absenteeism
In Australia alone, employees take around 8.8 days of unscheduled leave annually, costing the economy over $44 billion dollars per year (Food Mag, 2018).

Heightened individual wellbeing has been shown to correlate with lower levels of absenteeism, and reduced interruptions to collaborative projects in the workplace. (Jones et al, 2018).

Lower rate of Presenteeism
We often get to hear about the downside of absenteeism, but seldom do we discuss presenteeism which can be equally or at times even more disruptive to a business. Presenteeism refers to the periods when your employees come to work despite mental or physical illnesses. It is the state during which they are not in the mental and physical condition to deliver optimal performance.

Presenteeism costs businesses up to 57.5 days in lost productivity each year, which is much higher than the 4 days lost due to absenteeism (HRD, 2020). Reports indicate that Australia alone pays a price of $34 million annually due to lost productivity caused by presenteeism (ABC News, 2016).
 
Profit Maximisation
Employees working in an environment where they feel valued and heard are 4.6 times more likely to deliver their best (Forbes, 2019). This is because people are more collaborative than ever before and give a hundred percent when they feel they are working ‘with an organisation’ rather than ‘for an organisation’.

Studies highlight the strong correlation between employee wellbeing and productivity at work:

1. Organisations that place equal emphasis on employee wellbeing and performance are 220% more likely to be in the top quartile of profitability (Keller, S., & Price, C, 2011). This explains why some studies have found that every organisational dollar invested into organisational wellbeing provides a return of approximately five dollars – for example through improved productivity and enhanced customer service (Clifton, D. O., & Harter, J. K. 2003).
2.  Organisations that are rated by employees as being the best place to work or those with high employee satisfaction tend to have higher firm earnings. Oswald et al (2015) reported a 12% increase in performance and productivity when interventions to improve subjective wellbeing were implemented.
3. Differences in productivity between high and low wellbeing employees can be as much as 30% (Page, K. M., & Vella-Brodrick, D. A., 2009)

Workplace wellbeing initiatives can help to foster a work environment in which employees can thrive. It aligns the values of individual employees with organisational goals, which eventually translates into business benefits such as better performance, productivity and increased profits.   

Collagis is committed to helping businesses like yours to optimise workforce and organisational effectiveness.
We'd love to share with you how we can help you address wellbeing in your workplace. 

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Links to references

           Food Mag. (2018, April 09). The cost of absenteeism. Retrieved December 10, 2020, from FoodMag: https://foodmag.com.au/the-cost-of-absenteeism/#:~:text=On%20average%2C%20Australian%20employees%20take,%2444%20billion%20per%20year2.
           
             Oswald, A. J., Proto, E., & Sgroi, D. (2015). Happiness and productivity. Journal of Labor Economics, 33(4), 789-822.

           Tay, L., & Diener, E. (2011). Needs and subjective wellbeing around the world. Journal of personality and social psychology, 101(2), 354

           Wu, H., Sears, L. E., Coberley, C. R., & Pope, J. E. (2016). Overall wellbeing and supervisor ratings of employee performance, accountability, customer service, innovation, prosocial behavior, and selfdevelopment. Journal of occupational and environmental medicine, 58(1), 35.
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