Views on wellness programs go back and forth. On one hand, health care costs have skyrocketed and offering employee health care plans with top-notch preventative care should help to reduce those costs. On the other hand, many wellness programs antagonize the people they most need to change and their ROI has been elusive to measure.
Wellness strategies actually have a strong ROI for employers, but there are two counter-intuitive concepts to get past. First, the approaches that work best don’t focus on the people who “need it the most.” Instead, they include everyone at the company, often in surprising ways – think whole-person, social and intrinsically rewarding.
Second, the most important – and most easily measured – outcomes are not lower health costs. They are broader outcomes like employee engagement, turnover, revenue growth and earnings per share. These outcomes are achieved when employers focus on total employee well-being, not just physical health. A holistic approach to employee well-being encompasses everything from physical to emotional, financial and social wellness.
When employers apply this holistic approach to employee well-being across their entire population, that’s when they see the broadest set of outcomes. Ironically, that’s when they see the best health outcomes, too.
Here are a few data-backed results employers see when they invest in wellness programs:
You get more productive employees
When employees are distracted by stressors both inside and outside of the office, their work suffers. In fact, a study published by Rand in 2015 found that a lack of sleep, financial concerns and taking care of family members all put a dent in productivity. In addition, a 2015 PwC survey of working adults in the U.S. found that 37% spend three or more hours at work each week thinking about their personal finances.
If you don’t take a holistic approach to well-being, you’re letting your people down. And data says they will let you down in turn. Employers who support physical, emotional, financial and social well-being keep employees happy, healthy and performing at their best. This support starts with providing health care plans that offer employees a choice of voluntary benefits to better address their diverse needs can help to alleviate the stress they feel from finances, caregiving and even commuting.
Low stress, a good night’s sleep and healthy relationships with coworkers can transform employees into high performers. In fact, a recent report from Gallup on well-being and engagement found that those who were engaged and reported good well-being were 27% more likely to report that their performance at work was excellent.
You’ll see greater engagement
Engagement is an ongoing issue for most companies. According to the latest Gallup poll conducted in January, only 32.5% of the workforce is really engaged. That lack of engagement comes at a steep cost. Gallup’s State of the American Workplace, published in 2013, estimated that disengaged employees cost the U.S. between $ 450 and $ 550 billion.
The solution? Employee well-being.
Employees who feel valued by their employers are more likely to put in the effort necessary to succeed. A 2015 survey published by Quantum Workplace and my company, Limeade found that respondents were 38% more engaged and 18% more likely to go the extra mile when they felt their employers cared about their well-being.
Not only does wellness lead to better engagement, but the combination of wellness and engagement can also cut down on sick days. The Gallup report on well-being and engagement found that engaged employees who report good well-being are 30% less likely to miss work. And over the course of the year, these employees miss 70% fewer workdays from poor health than those who aren’t engaged and don’t have the best well-being.
Retention rates will improve
Talent is hard to find and employers are struggling to fill positions. In the war for talent, employers can’t afford to lose their top team members. In fact, research from Bersin by Deloitte found that companies spent close to $ 4,000 per hire in 2014. And that doesn’t cover the costs of lost time and productivity while the position sits open — an average of 52 days.
However, wellness programs can boost employee satisfaction, keeping top performers around, according to the Gallup survey on well-being and engagement. Employees who are engaged and report high well-being are 59% less likely to look for another job in the next year. Our internal research found that in large companies, those employing 5,000 or more, there is 25 percent lower turnover rate among higher well-being employees.
What’s more, the Quantum Workplace study found that when employees think their employer cares about their health and well-being, they’re 28% more likely to recommend their workplace to others. Happier and healthier employees mean more referrals, speeding up the time to hire and slashing recruiting costs in a competitive talent market.
Better company performance
When companies invest in employee wellness, employees complete high-quality work which has a powerful impact on the overall bottom line. That’s right — wellness not only boosts individual performance, it improves company performance, as well.
A study published in the January issue of the Journal of Occupational and Environmental Medicine tracked the stock performance of 45 publicly-traded companies that earned top scores on employee health and wellness scorecards.
The study found the high scorers outperformed the 500 largest U.S. companies listed on the S&P 500 index by 235 percent over a six-year period. Two additional studies published in the same issue showed similar results, suggesting that successful companies invest in and measure employee health.
These studies show the powerful symbiotic nature of wellness programs. When employers invest in wellness, employees invest right back into the success of the business. You will know this is working when you hear something like this from your employees: “My company thinks of me as more than just another worker, and I see my company as more than just a paycheck. My customers can sense it.”
Simply looking at employee wellness as a health care cost solution is shortsighted. Employers who have been doing this the longest are shifting away from cost-focused wellness programs in favor of well-being programs that employees love. Investing in various aspects of employee well-being results in a true return on investment that benefits both employers and their employees.
What’s your stance on wellness programs? What is their real value? Share your thoughts in the comments below!Business & Finance Articles on Business 2 Community