Employee wellbeing is profitable

The other day I had the pleasure of attending a presentation held by Professor Guy Ahonen. Guy is an expert on workplace wellbeing and I had really been looking forward to his presentation since his research is so closely related to my research on opting out and in. One of the things I have found in my research is that opting out and in can have an immense positive effect on wellbeing. And what I want to do with this knowledge is help organizations create sustainable working models and cultures where individuals won’t feel the need to opt out to achieve this sense of wellbeing that so many seem to be missing today.

Well, I wasn’t disappointed. The presentation was great; Guy’s research is pretty mind-blowing.

Through his research, Guy has managed to show that not only is employee wellbeing important in order for a company to do well, but it is so important that it should be considered strategic. The thing that makes this research so amazing is that not only does he show that wellbeing has a direct effect on performance and productivity, he does so in real numbers, in actual money. In other words, he has an ability to translate his research into a language that organizations really can understand, and to show them exactly how much money they would actually save if they work on increasing employee wellbeing. And let me tell you, we’re talking about a lot of money.

The research is based on data from companies in the Nordic countries, but they can be translated to other companies as well. What Guy and his team have done is collect data from companies on costs directly related to illness in the workplace. These include things like cost of injury, sick leave, and early retirement (and opting out I might add). It turns out that during the past couple of decades the cost of mental illness has skyrocketed, which may be due to mental illness thankfully becoming less of a taboo in society, but also, no doubt, due to things like constant restructuring and job insecurity. In fact, the Kelly Global Workforce Index shows that over 50% of all workers in the world are unhappy mostly due to these very reasons.

Well, the cost of illness in society is huge. In Finland it was about half of the state budget in 2012, which is mind-boggling. All costs aren’t work related, naturally, but the effect this has on individuals’ ability to work productively is substantial.

So what Guy and his team did was study companies that strategically and specifically targeted employee illness in order not to just minimize costs but also to get to the bottom of what the problem actually was and fix it. The savings these companies made was six times the savings made by companies that didn’t treat wellbeing as a strategic issue. You’ll have to read his book and report for exact numbers, but the implications are tremendous. Companies can save huge amounts by focusing on their employees’ wellbeing.

This is all fine and dandy and all companies in their right minds should obviously jump at this opportunity right away. But there is one thing that bothers me, one nagging thing at the back of my mind.

The thing that bothers me is the very argument that companies should care about their employees’ wellbeing because it is profitable. We argue this way because companies’ raison d´être is to constantly increase productivity and profit, and by speaking to this we (hopefully) get them on board. This is also true for gender equality or diversity initiatives. By showing companies that it is good for productivity and profit (which it is) we hope they will work at becoming more gender equal and inclusive.

But what happens if it stops being profitable? What happens if companies realize that it isn’t as profitable as promised, or that they are doing well enough as it is and the cost of turning their corporate culture around just isn’t worth it?

That is not okay. Caring about wellbeing, and making sure that employees don’t suffer, is a moral and ethical issue that cannot be reduced only to questions of productivity and profit. Making sure that half the population (women that is) have the same rights and possibilities to advance in their careers, not to mention people of different cultures, races, and sexual orientations, is not something we can do only if we feel like it or if it is worth our while. It is absolutely essential and anything else is immoral, unethical, and just wrong. Regardless of whether or not it is profitable.

How can we get organizations to understand that?

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