When faced with a mandate to grow their business, many CEOs will first look at ways to increase revenue by cutting costs, and health benefits are often a casualty. Though it might appear to be a prudent decision, in actuality cutting health benefits will hurt an employer’s bottom line in the long run. The best way to grow a business is investing in employees and establishing programs that help employees develop and achieve their optimal health, which will in turn help retain top talent and pay dividends for years to come.

Investing in Employees’ Health is Vital for a Thriving Business

Poor health among employees is costing U.S. employers much more than they may even realize. A recent Gallup poll found that unhealthy, absent American workers are costing businesses as much as $153 billion per year in lost productivity alone.

“The high percentages of full-time U.S. workers who have less than ideal health are a significant drain on productivity for U.S. businesses,” the report states. “However, employees and employers have the opportunity to potentially increase productivity if they address the health issues that are currently plaguing the workplace.”

To address those health issues, leading employers are beginning to take a new philosophical approach to assessing the ROI of corporate wellness programs, viewing them less as an expense and more as an investment in their employees and as an essential component in their company’s long-term strategic planning and growth.  Not only do corporate wellness programs increase morale and general health, they provide savings through lower overall long-term employer healthcare costs and extend the careers of productive, essential employees.

Don’t Invest and Risk Losing Employees

It’s important to retain those productive, essential employees, which a sound corporate wellness program helps to achieve. Studies show that the total cost of losing an employee can be upwards of 1.5-2X annual salary.

Some of the costs of losing an employee include:

  • Cost of hiring a new person (advertising, interviewing, screening, hiring)
  • Cost of onboarding a new person (training, management time)
  • Lost productivity
  • Customer service and errors

Ultimately Gain Greater Returns

Companies focusing on corporate wellness programs are yielding greater returns for their investors as well.  According to a 2013 study by the American College of Occupational Medicine (ACOEM), recipients of their Corporate Health Achievement Award (CHAA), given annually to companies focusing of health and safety initiatives, have consistently outperformed the S&P 500 national average over multiple-year studies.  In addition, professional services company Towers Watson states that employers with highly-effective health programs generate up to 20% more revenue per employee, see a 16.1% average higher market value, and deliver 57% higher shareholder return.


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