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Effects of Mental Health in the Workplace & Why It’s Important

  • Recursos humanos
  • Artículo
  • Lectura de 6 minutos
  • Last Updated: 10/26/2022
un grupo de empleados habla sobre los efectos de la salud mental en el lugar de trabajo

Table of Contents

A Paychex survey reveals that more than 40 percent of the employees surveyed are experiencing some combination of mental health, performance, and stress issues since the COVID-19 pandemic began1. They reported problems such as depression, lack of motivation, reduced focus, insomnia, and decreased teamwork. Poor mental health in the workplace is a problem.

The reasons for this downturn in mental health depend on the individual, but stressors may include the isolation of working remotely, changes in daily routine, worrying about the health of family members, and financial anxiety, to name a few. Employees may be feeling distracted and demotivated, or depressed and anxious. When they are unable to focus on their jobs, the effects can be devastating to businesses.

What Is Employee Mental Health?

Mental health describes our state of social, psychological, and emotional well-being and is an integral part of our overall wellness. A vast body of research links mental and physical health, which work together influencing how we think, feel, and act. The National Institute of Mental Health (NIHM) reports that chronic illnesses such as cancer, heart disease, or diabetes can make a person more likely to have or develop a mental health condition. Conversely, some mental health conditions, like depression, may play a role in increasing a person's risk of physical illness.

Mental health touches every aspect of our lives, especially workplace performance. Key performance indicators such as productivity, creativity, and social engagement can all take a hit if an employee's mental health is suffering. Prioritizing mental health in the workplace can help your workers flourish and reach their full potential, which is what businesses need to thrive and grow.

What Causes Poor Mental Health at Work?

We spend the vast majority of our waking hours in the workplace. Whether at the business or in a remote office at home, employees are managing workloads, engaging with customers and other employees, and tasked with the daily pressures of performing their duties.

There are many ways a work environment can contribute towards poor mental health at work. Excessive stress and frustration due to toxic or inexperienced leadership and unclear communication can build up over time. Layer this with a lack of clear roles and expectations, long or inflexible work schedules, unrealistic demands, and lack of support for employees and it's no surprise a worker can feel unsatisfied, depressed, and exhausted. Other factors can compound the issue — too many unpleasant or rote tasks, being subjected to discrimination, watching favoritism play out with coworkers, harassment or bullying, no sense of teamwork, and lack of recognition. Don't overlook the ripple effect of mental health at work as employees struggle to balance personal and work demands as well as growing financial pressures.

Importance of Addressing Mental Health in the Workplace

Make no mistake, the success and longevity of a business rely on the collective, positive mental health of its workers. Positive mental health gives a person resiliency against life's stressors, challenges, and setbacks — obstacles that often go hand-in-hand with a job. Being fortified against these negative emotions and anxiety that accompany these difficult times can help a person navigate with agility and remain productive.

When a manager or supervisor makes a practice of addressing the importance of mental health in the workplace, everyone benefits. A healthy state of mind can translate to higher levels of creativity along with a greater sense of self-worth and sense of happiness. These are prized attributes for nurturing high performance and strong corporate culture.

The High Cost of Poor Employee Mental Health in the Workplace

A quick online search reveals there is no shortage of studies linking poor employee mental health to high economic burdens. Lost productivity, absenteeism, having to recruit and train employees due to high turnover, and potentially higher health insurance costs -- these are all costs that can potentially be related to poor employee mental health. Even for small businesses, these costs can add up.

A Disconnect Between Employers and Employees on Mental Health

While the employers we surveyed said they are aware of the costs of mental health issues to their business, they may not be as aware of the extent of employee's mental health struggles. Employers say that since the COVID-19 pandemic began, they are:

  • More than 3x more likely than employees to believe employee motivation or focus has improved
  • 2x as likely to think company teamwork is better

Conversely, many of the employees surveyed said they felt less motivated since the pandemic began and didn't think teamwork was better or had changed appreciably.

One reason may be that employees don't feel comfortable talking about their personal or mental health issues with superiors. In a Paychex survey, more than half of respondents – 54 percent – said they felt uncomfortable talking to their supervisors about mental health. Some even feared that discussing it could lead to being fired or furloughed (30 percent) or cost them a promotion (29 percent). If employees did talk about their personal issues, they were most likely to confide in co-workers.

Impact of Poor Employee Mental Health in the Workplace

Although they may not be as aware of their employees' declining mental health, employers are aware of the dramatic impact of workplace mental health issues on their bottom line. As many as 40 percent say mental health issues can have a negative impact on productivity, revenues, customer service, and the potential to compete. Drill down further, and the impacts can spread to talent retention and acquisition and create a grim feedback loop that can be difficult to break. Employers must be careful not to overlook the following effects of mental health in the workplace.

Strained Relationships With Coworkers

Strained relationships with coworkers can be the result of a sense of unhealthy rivalry. In such situations, interactions will feel strained and edgy rather than impart a sense of teamwork. If an employee does not feel comfortable around their coworkers, they are likely to avoid interactions and be hesitant to share their ideas and insights that contribute to innovative problem-solving.

Poor Relationships With Managers or Superiors

With the hierarchical structure of most businesses, managers and superiors hold sway over their employees, which can leave employees feeling anxious and vulnerable. For instance, an overbearing boss who micromanages every detail can leave workers feeling an absence of trust in their competence and ability to do their roles. Other times, managers may hold unrealistic expectations for deadlines, sales quotas, or deliverables.

Working under an umbrella of constant stress will lead to strained relationships. Moreover, an over-tasked employee is at risk for being unable to meet expectations, including those of customers.

Declining Company Revenue

Revenue for any business is the cumulative result of many efforts. Innovation, attention to detail, and excellent service are just a few. Bottom line: strong employee mental health in the workplace fuels strong profits.

When energy is spent on managing difficult relationships rather than coming up with creative ideas and being productive, a business loses the valuable employee contributions it needs to keep an edge over its competition. Customers can also sense when a worker is unhappy or stressed and may seek to take their business where they will be greeted with a genuine smile and customer service backed with employees who have ownership in the client relationship.

Low Morale and Increased Risk of Job Flight

Happy employees who are satisfied with their job and have strong social networks in the workplace tend to exhibit high loyalty. Conversely, when interactions with colleagues and supervisors are tense and the business's internal structure leaves little room for growth, low morale is likely. Unless action is taken to help an employee feel valued and cared for, they are at risk for leaving the business to search for a more suitable arrangement elsewhere.

Damaged Reputation and Negative Brand Association

In an age when customers value how a business treats its staff and don't hesitate to share their experiences on social media, it's likely that low employee morale will make itself known to consumers, clients, and the public at large. Employees and the work they do put a face and reputation to the business. An employer who does not pay attention to workers' mental health needs risks having its corporate brand associated with callousness and negativity. It's likely that an adverse impact on talent acquisition and sales will ensue.

How Can Employers Support Mental Health in the Workplace?

Supporting mental health in the workplace does not have to be expensive or complicated. There are many strategies that will nurture a culture of mental health and well-being.

  • Offer a rich mix of benefits. Employers can help their workers feel less stressed about their health and their financial future with affordable health insurance, an employer-sponsored retirement plan, programs specifically dedicated to supporting employee mental health, and programs that offer financial fitness support.
  • Flexible scheduling or remote work. Allowing employees to work flexible hours or the ability for some remote work can be a relatively simple, low-cost option that may help their work/life balance.
  • Check-ins with supervisors. Regular meetings may give supervisors the ability to gauge how the employee is feeling. Discussions can include issues the employee is having, solutions available to them, and career pathing to keep the employee engaged and working towards goals.
  • A confidential online communication system. If a question or issue should arise, employees may contact their HR professional or supervisor online through an internal communication system. This can be a convenient, confidential way to keep supervisors and employees connected. It can also allow the supervisor to respond quickly and take any necessary steps.
  • Opportunities for enjoyment and enrichment. Consider including in your rich mix of benefits, other types of workplace perks. This can range from challenges or programs to improve physical and mental health to handwritten thank you cards acknowledging a job well done or appreciation of service during challenging times.

An Employee Assistance Program

Employee Assistance Programs (EAPs) offer free, confidential assistance that connects employees to a broad range of services that can include everything from finding childcare to fitness programs to counseling referrals. According to our 2021 study, roughly one in five small- to medium-sized business principals is extremely or very likely to offer an EAP within the next 12 months.

Effects of Good Mental Health in the Workplace

Wellness programs and benefits can be major factors for today's job seekers.

Sixty percent of employees surveyed say that employee wellness benefits will factor into the selection of their next job. Eighty percent between the ages of 18-39 will prioritize these benefits in a job search. And sixty-six percent of employees report feeling better about their employer after using a benefit.

Increase productivity with healthier, happier employees and create a more vibrant, supportive workplace. The ability to attract top talent and retain your most valued employees. All of these can result from an investment in your employees' well-being.

Learn how a mentally healthy workplace is good for business and take steps today to improve the mental health of your employees. Examine the important role of mental health in the workplace here.


[1] 500 U.S. SMB Principals and employees — 250 each — at organizations with 2 to 99 employees. Survey was fielded December 10-30, 2020.

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* Este contenido es solo para fines educativos, no tiene por objeto proporcionar asesoría jurídica específica y no debe utilizarse en sustitución de la asesoría jurídica de un abogado u otro profesional calificado. Es posible que la información no refleje los cambios más recientes en la legislación, la cual podrá modificarse sin previo aviso y no se garantiza que esté completa, correcta o actualizada.