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4 Ways to Help Reduce the Cost of Work-Related Stress

Human Resources

Work-related stress can be a real concern for employers. From the always-on nature of today's connected environment to heavy workloads, employees can have a lot on their plates. In fact, the Society for Human Resource Management reported that one out of three employees noted they felt above average levels of stress. What impact does stress have on your company's bottom line, and how can you take proactive steps to minimize it?

Stress and Perceived Performance

When employees are under stress, they're more likely to leave their jobs. They may seek opportunities where they have better work/life balance, a more manageable workload, or simply better relationships with their colleagues. According to the Harvard Business Review, company leaders should pay attention not only to why people leave their jobs – but when. Specifically, they note, there's a higher risk of stressed out employees leaving when they're not doing well compared to their peers or receiving a raise, or at natural reflection points such as birthday and service anniversaries. Consider developing a culture which prioritizes employee recognition to help workers feel appreciated at these critical junctures.

Increased Employee Absenteeism: Paying the Costs for Stress reports that as many as one million people miss work every day due to stress. This adds up to hundreds of dollars per employee – and millions of dollars per year. Consider the use of employee time and attendance solutions to monitor for patterns of employee absenteeism. Companies can help lower absenteeism by exploring options such as generous paid time off policies, schedules which align with employees' personal obligations, and flexible solutions such as telecommuting and remote work arrangements.

Reduced Productivity: Costing Billions in Lost Profits and Operational Costs

Even if your stressed employees aren't leaving or calling in sick, it can impact their performance. Employees who come to work but don't perform at full capacity cost companies as much as $150 billion in lost productivity, according to SHRM. From decreased output and poor performance to spending time fixing errors, a stressed out workforce is at a disadvantage in terms of output and/or profits as compared to an organization where the workforce is both healthy and happy. For HR leaders and business owners, this is an important opportunity to watch for the early warning signs of stress. Monitoring employee engagement and productivity on a regular basis – and offering solutions – can help keep productivity levels high.

Decreased Morale: Keeping Up Team Spirits

High levels of employee stress can adversely affect employee morale and engagement. Record low levels of employee engagement have been making headlines – and in many cases, employees are frustrated due to high-stress levels. To proactively combat this problem, consider consistently measuring your employee engagement levels. If morale or engagement is dropping unexpectedly, engage in the due diligence needed to determine the cause. Make investments in improving employee morale by focusing on employee recognition, team building, and investing in an inclusive culture. Over the long term, focusing on employee happiness can mitigate some of the negative effects of workplace stress.

Workplace stress can take a toll on your workforce – which can ultimately translate to a negative impact on your bottom line. Decreased productivity, rising levels of absenteeism, low morale, and high turnover are all risks when employees' stress levels are not addressed. By establishing a clear approach to solving this issue, HR leaders and business owners can help to reduce stress and minimize the negative effects on their business.


This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.
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