CEDA’s mental health report highlights cost to the economy

The Committee for Economic Development of Australia (CEDA) released Mental Health and the Workplace: How can employers improve productivity through wellbeing? The report says that mental health costs the Australian economy $70 billion each year.

According to CEDA, by 2030, mental health claims are likely to double. The report recommends the government invests more time and resources into researching mental health intervention and prevention. It also suggests that employers do their part via assessment, surveying staff, reporting issues, and evaluating results.

“There is clearly an incentive for employers to invest in the mental health of their staff and reduce the rate of claims related to mental health,” said CEDA.

“Jobs that are high demand and low control are generally classified as high strain – and have the greatest risk of mental ill health.”

Dr Patrick Aouad, neurologist and co-founder and CEO of CU Health commented on the report: “Never before has there been more data to substantiate the investment businesses must make in the wellbeing of their employees. Importantly that investment isn’t just in the support services that are offered, but more broadly it’s about taking a step back all the way to executive leadership teams and being open to identify any leadership, management and procedural issues that may be undermining the pursuit of wellbeing.”

“When it comes to actual support services for workers, the needs will vary hugely based on the industry, location, age and stage of life of employees; therefore, having services that are confidential, personalised and evidence based with sustainable results is key,” said Dr Aouad.

CEDA estimates that 3.5 million Australians struggle with mental health issues. CEDA notes that companies have made positive steps towards protecting physical safety, with claims dropping by half, but more can be done for emotional safety.

Some organisations offer benefits such as exercise classes, meals, or end of year trips. However, CEDA notes that there is little evidence to determine whether these incentives have a positive impact on mental health.

CEDA’s mental health report continued: “These benefits may be welcomed by staff but are unlikely to have any significant impact on mental health outcomes, particularly if the foundations of good mental health are not in place in the workplace.”

The report says that mental health claims are likely to increase due to implications from the pandemic, such as job insecurity, trade disruption, and working from home. CEDA notes that mental health related workers compensation claims have increased by almost 60 per cent since 2000.

Dr Aouad continued: “The central processing unit of most organisations is its people. If their minds and brains are not supported, it’s like trying to run a company with broken computers.”

“An important clinical aspect is that mental health and physical health are intrinsically linked. Any service that claims to be able to manage mental health sustainably, requires a strong physical health offering too,” Dr Aouad explained.

The report stated: “The Productivity Commission estimated that the cost of absenteeism from work due to mental ill health was up to $10 billion per year due to people taking an average of 10-12 days off. People with mental ill health are also estimated to experience reduced productivity on 14-18 days per year – an estimated cost of $7 billion per year.”

With the Productivity Commission’s statistics in mind, CEDA notes that promoting wellbeing in the workplace can increase productivity through reducing absenteeism and presenteeism.

Dr Aouad said: “This is an excellent report – it ties together the wellbeing of individuals to the wellbeing of organisations and puts a dollar figure on it! This kind of information is what business owners and boards need, to take the necessary steps to truly achieve organisational health, one employee at a time.”

The full report can be found here.