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How Mental Health Impacts Employee Performance & Retention

  • by: Ian Preddy
  • On: 10, Oct 2019
4 min read

World Mental Health Day is a day to raise awareness of the importance of mental wellbeing. Recognised by the World Health Organisation (WHO), the annual date aims to highlight the fact that one in four people in the world will be affected by mental or neurological disorders at some point in their lives.

How does poor mental wellbeing impact employee performance & retention?

1. Increased Sickness Absence

Mental illness is the leading cause of workplace sickness absence. In 2018, 15.4 million working days were lost to work-related stress, depression or anxiety, with an average of 25.8 days lost per employee with these conditions. In total, 57% of all UK workdays lost were due to stress and anxiety.

With such a high percentage of workers suffering annually, huge numbers of sickness absences are bound to affect business growth.

2. Reduced Productivity

In the age of presenteeism, many workers may try to work through a period of illness – but their productivity will suffer.

The Harvard Business Review reports that 60% of people have experienced symptoms of mental health issues in the past year alone. Employees don’t have to be clinically diagnosed with mental illness to be affected by it in their work and home life. Many people will not necessarily know that they are suffering from a specific disorder – they might believe they’re just going through a ‘rough patch’ or see chronic stress as a natural part of the job – so problems must be identified to prevent further damage to job performance.

Sick staff cost British firms £77 billion annually in lost productivity. Presenteeism also adds to stress and anxiety experienced by individual workers, prolonging their mental illness and making recovery even more difficult.

3. Higher Employee Turnover

Half of millennial employees and 75% of Generation Z employees have left jobs for mental health reasons. The youngest generations of workers report that financial problems caused by unaffordable living costs, overwhelming debt, healthcare costs and a lack of access to the housing market have a significant impact on their psychological wellbeing.

With depression amongst millennials rapidly increasing, business leaders and HR departments that prioritise mental wellbeing will reduce employee turnover and increase the engagement and happiness of their workforce.

4. Lack of Development & Performance Improvement

Workers who are unhappy, stressed or anxious because of a mental illness will be demotivated at work, find it difficult to concentrate on complex tasks and will be less inclined to collaborate with colleagues. This will not only affect their current performance, but their future success in their job.

Stress, depression, anxiety and other disorders are by nature short-sighted: sufferers find it almost impossible to imagine a future without mental illness and cannot therefore create or engage with a learning and development plan. Concentration impedes the ability to learn new technical skills or problem-solve, halting or postponing vital development opportunities for promising workers.

5. Less Diverse Workforce

Minority groups are far more likely to suffer from mental illness. One in five women (compared to one in eight men) suffer from a mental illness, LGBT+ people are 1½ times more likely to develop depression and anxiety, and people from black and minority ethnic groups are far more likely to be diagnosed with and admitted to hospital for mental health problems. Sexism, racism, homophobia, and other discrimination adds further stress to individuals in minority groups who are already suffering.

McKinsey reports that diverse businesses are 15-35% more likely to financially outperform their competitors. Businesses that don’t support mental wellbeing initiatives or have a negative track record for supporting previous employees will find it even harder to attract, engage, retain and develop diverse employees.

How to Help Employees Identify and Overcome Mental Health Issues

Although every condition is different, and experiences vary from person to person, symptoms of a mental health problem can include:

· Confused thinking / reduced concentration

· Rapid heartbeat

· Inability to cope with daily problems or stress

· Trembling/shaking

· Extreme mood changes

· Withdrawal from friends and activities

· Upset stomach

· Dizziness or fainting

· Chronic fatigue

Employers can make small steps to supporting employees by sending HR teams on training courses to become qualified Mental Health First Aiders and ensuring that private healthcare plans cover counselling, therapy and CBT sessions. Prominently displaying help numbers and information in communal areas can reassure employees that their employer cares about their wellbeing and ensuring that managers know how to spot mental health issues with help them support their teams.


Read our 5 Steps to Increase Employee Retention.

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