While employment has never been higher in the UK, and compares very favourably with other developed economies, there is an iceberg issue that is not receiving the boardroom attention it deserves – absence.
The UK is experiencing a resurgence in workplace absence; and with it millions of days of lost productivity. Despite various publications reporting a constant year-on-year reduction in absence, our empirical data shows that absence has actually been rising since 2011. Absence and poor health are causing people to be less productive in 2017 compared to just five years ago.
FirstCare recently commissioned The Centre for Economic and Business Research (Cebr) to analyse our data on absence trends – which covers 192,000 people in the UK. Our new report found that workplace absence costs the UK a staggering £18bn per year in lost productivity.
The cost is only set to rise – in 2020, it is predicted to cost the UK economy £21bn and by 2030 it will be £26bn. These huge figures act as a major drag on the economy at a time when there are already significant growth challenges for businesses.
While the issues and costs of absence are bigger than people understand, the solutions are simpler than you might think.
It starts with understanding the underlying issues. An ageing workforce, millennial workers seeking regular changes to their careers and a rise in part-time working are changing the dynamics of work in the UK. Employers are dealing with a workforce that is markedly different to just a decade ago.
This is a time of both challenge and opportunity. Employers must deal with a more diverse workforce, different generational requirements and issues such as the rising prevalence of mental health conditions. Yet they can also seize the opportunity to harness data and technology to create the conditions for a happier, healthier and more productive workforce.
A Changing Workforce
Britain’s workforce is steadily getting older. In 2014, the average age rose beyond 40 for the first time ever. In line with this there has been a 30% rise in 55-59 year-olds working between 2009 and 2016, with the 60-64 demographic seeing a 49% increase. This is a contributing factor in the increased prevalence of musculoskeletal injuries and long-term absences caused by surgery. Despite enormous investment in various forms of treatment, musculoskeletal injuries continue to be the biggest reason for absence. A trend that will only keep rising as the retirement age increases.
Linked to this is a rising demand for part-time work. Our data shows there are more people working part-time today than in 2009: an outcome driven by various motivations, including parents seeking better balance between work and family life and an older workforce looking to ease their transition into retirement.
Finally, the prevalence of mental health issues in the UK workforce is the single biggest area of change for workplace absence. There has been a 71% increase in mental health issues in five years. Professionals aged 30-40 years are the hardest hit – with stagnant wages, rising costs of living and the need to balance work with life all creating pressure.
To address the issue of rising absence at root, we need a more comprehensive approach to supporting people with mental health conditions. With 57% of mental health related absence among 40-60 year olds, this needs to take into account the disproportionate effect on the older demographic, and women in particular.
Tackling the Issues
To reduce the burden of absence, organisations need to take a forward thinking approach – from adopting flexible working, harnessing the power of data, and tackling mental health issues.
Flexibility should be the norm in all large organisations. Flexible arrangements – enabled by technology – are helping people return to work gradually and happily after a prolonged absence. For both millennials seeking more control over their working hours, and older workers whose time needs to be carefully managed to support their extended career, there are many advantages to a more flexible approach.
There is also a growing awareness that mental and physical health needs to be treated as equally weighted issues. However, employers also need to start considering wellbeing, health and mental health as more than employee welfare, and as a strategic priority for the business. Mental health awareness needs to grow across the workforce. Mental health first aiders, compliance with return to work interviews and open and honest conversations across the workforce are imperative.
Finally, but perhaps most importantly, data really must be at the heart of how employers are responding to the challenges of a changing workforce. Only by collating accurate data on absence – including trends and disparities across regions and roles – and then continually monitoring and managing this absence, and the reasons for it, can employers gain critical insights that tell the real story behind what is happening within their workforce. Supported by the facts, employers can make targeted interventions and embrace new ideas and required services rather than defer to the established norms. This enables organisations to engage in empowering conversations to explain why absence matters.
Indeed the importance of data as a tool to improve efficiency and better manage workforces, will be at the heart of a new, free best practice seminar that FirstCare will host with Eversheds Sutherlands on 18 and 19 May 2017 in London.
Managing absence is a complex task, and a failure to do it successfully can have far-reaching consequences for a business of any size. However, straightforward solutions exist, and they are surprising simple. Through access to timely and accurate data, employers can tackle the absence challenge with ease and flexibility. In doing so, employers will not just be safeguarding the future of their businesses, but will be doing better by their colleagues.