By Karen Taylor, Director and Samrina Bhatti, Manager, Deloitte Centre for Health Solutions

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This week, we launched the latest report in our future of public health series, Evaluating the role of employers in reducing the public health gap: Improving the health and productivity of employees. Although slightly tangential to the other reports in the series, this report focuses more on the role of employers in improving the health and wellbeing of their employees. The report evaluates the implications of good health and wellbeing on workforce productivity and highlights the growing body of evidence that shows how employer initiatives to support the wellbeing of their employees can improve the health of local communities; staff recruitment and retention and, ultimately, business growth. This week’s blog summarises the findings in our report and the case for employers to invest in employee health.

The challenges in reducing health inequalities and improving the wellbeing and productivity of employees

The COVID-19 pandemic has exposed stark inequalities in health and society, including differences in employers’ approach to the wellbeing of their employees. It has also shown the UK to be a deeply unequal society, with widening health inequalities shaped by the social determinants of health (the conditions in which people are born, grow, live, work and age). Employment is acknowledged as an important driver of inequalities, and why employers have such a crucial role in improving the health outcomes of their employees.

The pandemic has exposed the close link between employment status and the physical and mental health of employees, their productivity, and the costs to employers of absenteeism, presenteeism and staff turnover. Pre-existing inequalities were exacerbated by disparities such as job types, quality of work, ability to work remotely, access to sick pay, and isolation payments. The physical and mental health of key workers has been a particular challenge with increased levels of stress due to the higher risk of exposure to the virus, high workloads, burnout, and a poor work-life balance. These inequalities are likely to increase still further due to rising inflation and job losses at the lower end of the labour income distribution. Some employers, like those providing public transport, education, health, and social care, need not only to safeguard the health of their employees but also service users.

While the pandemic has increased the priority that employers give to improving the health and wellbeing of their employees, half still lack a formal strategy or approach. Few employers measure the impact of the wellbeing interventions they have introduced. Moreover, the pandemic has caused some employees to be more aware of their health risks and to proactively invest in improving their health, while others have adopted less healthy behaviours. Employers therefore need to have a stock take of the current state of their employees’ health and wellbeing and consider how best to influence or incentivise healthier behaviours.

The economic case for employers to support their employees’ health and wellbeing

The case for investment, in improving employee health and wellbeing, includes public health benefits, such as reduced disease burden and a reduction in health inequalities, and significant economic benefits. The Confederation of British Industry (CBI) estimated that poor health in the workplace translates into an annual cost to the UK of around £300 billion in lost economic output (excluding health costs), with 63 per cent of the total number of years lost to poor health in the working age population. The CBI estimated that business-led health interventions inside and outside the workplace could generate an uplift of £180 billion in Gross Value Added (GVA) by 2030.

Deloitte has examined the case for employer investment in the mental health of their employees in a series of reports published in 2017, 2020 and 2022. The latest report found that there had been an increase in the proportion of people rating their health as ‘bad’ or ‘very bad’, and also in the numbers that had left their job for mental health or wellbeing reasons. Deloitte estimated that the total cost to UK employers of poor mental health in the workforce was £53–£56 billion (a 25 per cent increase on the pre-pandemic estimate) – see Figure 1. Importantly, the average return on investment in improving mental health was £5.3 for every £1 invested. Organisation-wide early interventions, such as promoting culture change, provided the highest returns (£5.60 for every £1 invested) – providing a strong economic case for employer investment.

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Interventions to improve the health and wellbeing of employees

Historically, employers have adopted a variety of approaches to support employee health and wellbeing, including access to occupational health services or private health insurance. Although two-thirds of employers have increased the support provided to staff since the start of the pandemic, employees are not always aware of the support available. Many organisations are also responding to the changes wrought by the pandemic to re-design work to ‘make it better for employees and make employees better at work’.

Today, many employers are moving beyond piecemeal wellbeing programmes to put wellbeing at the centre of their organisation’s plans to transform working practices. They believe that this can yield improvements in employee engagement, performance, and overall resilience. To be effective, the design of wellbeing into work needs to be developed, strengthened, and flexed over time, focused on prevention, and tailored to the needs of different groups rather than a ‘one-size-fits-all approach. Furthermore, employers need to communicate more effectively the support packages provided, make them easy to access and monitor uptake and impact.  

The adoption of digital health solutions by employers, in particular mental health, and wellbeing apps, has accelerated during the COVID-19 pandemic. Digital technologies have been shown to improve employee engagement with health initiatives by providing personalised, anonymous, self-directed support that can be accessed at a place and time most suitable to them. However, in 2020 alone some 90,000 digital health apps were launched to consumers, with many now targeting employers. To be effective, digital resources need to be evidence-based and validated. Indeed, employers need to have access to relevant metrics on the use and impact of interventions to help them align interventions to employee need as part of their health and wellbeing strategy.

The future role of employers in improving public health

The evidence is irrefutable, improvements in health lead to improved productivity and, ultimately, economic growth. As part of the ‘levelling-up’ agenda, employers need to see employee health and wellbeing as an asset to invest in, with long term returns measured by closing the gap in health inequalities, reducing sickness absences and equalising employment opportunities. This in turn will improve the productivity of individuals, organisations, and the nation.

Increasingly, however, there is a need for employers to focus more on co-developing health and wellness interventions. There are, for example, clear differences in the skills, experience, expectations, and preferences that each generation of workers bring, requiring employers to reflect these differences in their workforce strategies. Putting wellbeing at the centre of work transformation and embedding it across all levels and environments will not only drive and sustain employee performance but will also help organisations create the conditions where each employee feels supported and can perform at their best (see Figure 2).

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Conclusions and actions for employers

The business case linking improvements in the health of employees improvements to the health of the economy is clear, and despite the detrimental impact of the pandemic for many, employers now have a pivotal opportunity to revisit how they are supporting the health of their employees and their local communities. Our report, identifies a series of actions for employers at leadership level, for managers across all levels and some specifically targeting mental health and wellbeing. This is not simply a nice to have, or because poor public health has consequences for workforce productivity, but simply because it’s the right thing to do. Businesses that ignore this opportunity run the risk of being left behind as health and wellbeing become critical factors in attracting and retaining talent.

Watch our webinar on demand: A recording of our recent panel discussion on our report on employer’s role in improving employee health with guest panellists from Vitality and Business for Health is available here.

Stay tuned for the podcast: We will release a new podcast episode in the Life Sciences Connect series, where we’ll explore this new report in conversation with Sara Siegel, Partner, UK Health and Social Care Sector Leader, Deloitte and John Haughey, Partner, Global Consulting LSHC Industry Leader, Deloitte. The podcast will be available in the next few weeks here.

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Karen Taylor - Director, UK Centre for Health Solutions

Karen is the Research Director of the Centre for Health Solutions. She supports the Healthcare and Life Sciences practice by driving independent and objective business research and analysis into key industry challenges and associated solutions; generating evidence based insights and points of view on issues from pharmaceuticals and technology innovation to healthcare management and reform.

Email | LinkedIn

Samrina

Samrina Bhatti, MRPharmS, PGDipGPP, Manager

Sam is a national award-winning pharmacist with local, national and international experience. Prior to joining the Centre, Sam was working alongside the Chief Pharmacist at Bart’s Health delivering trust-wide projects in service development and implementation. Prior to this Sam was the NHS England Chief Pharmaceutical Officers’ Clinical Fellow at Specialist Pharmacy Service, where she led various national projects on medicines use and digital healthcare. Sam is part of the global commonwealth health partnerships, an NHS England Clinical Entrepreneur, and a pre-doctoral fellow at Health Education England undertaking a PGCert in Healthcare Research Methods. Sam is also an associate of the Faculty of Clinical Informatics and Institute of Healthcare Management and has a Master of Pharmacy from King's College London and Diploma in General Pharmacy Practice.

Email | LinkedIn

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