Industry Focus: The Food Manufacturing Industry
Wednesday 6th June
The Hidden Cost of Absence in the Food Manufacturing Industry
Many of us know, or have read, about the cost of absence to the UK’s economy. These statistics are large, in fact too large to really digest, making them easy to simply ignore. For instance, we hear “137.3 million working days lost due to sickness or injury in the UK” but what does this really mean?
Even when broken down to the individual employee, where the published figures tell us that “the average level of absence is 6.3 days per employee”, it can be difficult to comprehend the true effect of this on your business. If you, like many other companies, say “absence rate hasn’t been that high amongst our staff” it can be hard to see how these stats really affect your business and all too often this cost is disregarded. Often you don’t see a bill for absence as it is “absorbed” within your business’ cost of salary. So, you think to yourself, “there isn’t really a cost within my business”. But the truth is absence affects us all, whether it’s a large or small-scale operation, absence occurs everywhere and always has a cost associated with it.
"If you employ 100 people, this is a cost of £55,700 per annum"
We get a clearer picture of what’s really going on when we break the data down to individual industries. The CIPD, HSE and Office for National Statistics all agree that within the food manufacturing industry every year the average cost of absence to your business is £557 per employee. If you employ 100 people, this is a cost of £55,700 per annum. Looking at this figure you can see why it is so important to keep absence costs under control. These costs may simply be Statutory Sick Pay but they can also extend to overtime, temps or agency workers. Furthermore, absence has a live impact on your business’ growth and output. It affects productivity, staff morale, overtime costs, temporary staff cover costs, loss of skilled workforce and much more.
While sickness absence covers all sickness from common colds to back ache the highest causes for absence are musculoskeletal disorders (MSDs) and mental health (such as stress, depression and anxiety). These account for 41% and 45% respectively, making up 86% of all absence. They are also the causes which your business can most directly affect by implementing an absence management scheme.
An effective absence management approach is one that focuses on health promotion and employee well-being, offering of clinical resources, and encouraging early support for individuals so as to prevent absence from occurring.
"happy, healthy employees are proven to be more productive"
The key to absence is how you manage it, happy, healthy employees are proven to be more productive whilst absent employees simply mean lost revenue. The CIPD recommend initial and ongoing training and support for managers so that they feel capable and confident to manage absence in the appropriate way and create a culture of employee well-being and health within the business. Line managers need HR training, knowledge, and clinical input from external sources to assist early returns. The CIPD state that businesses should have a “go to” source or clinical company to provide treatment, advice and information when it is required. Clinical input (an Occupational Health Advisor, an MSK specialist, or a mental health professional) can provide the solution to the particular illness or injury as well as advice on how to manage a quicker and safer return to work. They can also provide advice on alterations to the employee’s job role, or phased return whilst the employee receives treatment or rehabilitation to assist in the recovery or management of their condition.
The most effective businesses have these systems in place to combat both musculoskeletal and mental health absences. By utilising the treatment and advice these clinical companies provide they assist employees in their safe return to work, making accommodations for the employee, where possible, to aid them in their recovery. By reacting quickly to the causes of absence and creating a culture of wellbeing within their business companies are able to reduce absence times and keep their workforce productive.
"it is only once companies see what they are saving that they realise the extent of what was being kept hidden."
Having managed and reduced absence for over 22 years for food manufacturing companies, IPRS Health know that experts within clinical arenas are best placed to provide the right advice, treatment and rehabilitation to assist in reducing the cost of absence. Our clinical results and consistent return on investment demonstrate that a healthier workforce makes for healthier business margins. Our first-hand experience has gone to show that it is only once companies see what they are saving that they realise the extent of what was being kept hidden.
Presenteeism – an unquantifiable concern?
Absence isn’t the only issue businesses are faced with, presenteeism is a growing concern and is even more difficult to account for. It is largely considered the greatest threat to UK workplace productivity. The UK ranks 6th out of the G7 countries for productivity and UK workforces are 31% less productive than their American counterparts. It is no longer enough for businesses to be reactionary to the causes of absence they must be proactive in promoting a healthy working environment and healthy lifestyle choices for their employees.
Presenteeism is thought to cost twice the rate of absence and 89% of workers that show up for work whilst ill or injured admit that they are considerably less productive. In fact, mental health presenteeism alone is thought to cost the UK economy £15.1 billion.
The CIPD 2016 survey did show a positive trend amongst UK businesses as they begin to encourage workers not come into work if they are ill. But employers need to take an active role in encouraging employee health and well-being programmes, provide assistance when injured or ill and correctly manage the employee so as to promote a culture of positivity toward healthy living within the workplace.
Occupational MSK & Mental Health Advice – tools for managers to manage absence
Giving managers access to the correct occupational advice, health information, assessment of the condition, and a guidance as to the timeframe for recovery provides a manager with a powerful tool to manage absence within their team of employees. Extending this toolbox to give access to clinical support, rehabilitation or treatment will reduce absence, promote a happy working environment and encourage workers to stay healthy and focused on their well-being.
Of course, if you really want to get it right, your company should encourage early intervention, preventative tools, advice and a holistic approach to health. This will significantly reduce long term absence, prevent reoccurrences, and empower employees with the knowledge to stay fit and healthy to avoid or manage injury, illness and other conditions. By properly managing absence and presenteeism the evidence shows you can effectively reduce costs whilst increasing productivity.
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Sources –
https://www.cipd.co.uk/knowledge/fundamentals/relations/absence/absence-management-surveys
http://www.hse.gov.uk/sicknessabsence/
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