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Call Center/CRM Management Scope
November 2004


Workplace Stress Sucks $300 Billion Annually From Corporate Profits

By Ron Ball, Inroads, LLC

In 1992, a United Nations report called stress the “20th century epidemic.” Four years later, a survey by the World Health Organization (WHO) pointed at stress as a “worldwide epidemic.”

In a fast-paced, changing business world, no one expects stress to go away anytime soon. Everybody experiences it one way or another. Most employees agree that a reasonable amount of stress is okay. In fact, there is such a thing as good stress. Just like there is good cholesterol, there’s also good stress. It’s called “eustress.” Eustress is the amount of positive energy that ex-cites and moves a person to achieve a goal. Eustress in-vigorates, motivates and drives people’s internal engines to get things done. However, when those engines run too long or too hard, stress breaks engines down. Then people are in a state of distress.

Workplace stress overload results in one million absent American workers each day. Stress results in mistakes and accidents, declining productivity and burnout, low morale and lost employees, increases in alcoholism and drug use, as well as workplace violence and harassment. To remain competitive, executives and managers in organizations need to evaluate how excess stress may be affecting their employees.

In 1992, a well respected Northwestern Life Insurance study reported that 7 in 10 American workers indicated that job stress caused frequent health problems and made workers less productive. Forty-six percent of employees reported their job was very stressful, 34 percent thought of quitting their jobs and 14 percent actually left because of stress.

What’s stunning is the cost of stress. It’s now a $300 billion profit killer in American business. Industry experts agree that workplace stress is an increasingly important issue. Carole Spiers, former chairperson of the International Stress Management Association, believes that companies have a massive problem on their hands. Unless they act to reduce stress, it will have a strong impact on their bottom line and interfere with their ability to achieve long-term success.

According to Roger Herman, senior fellow at the Workplace Stability Institute, 40 percent of employees feel that their job is very stressful or extremely stressful. The major concern is not only that employees are reporting job stress but that it’s strongly impacting profitability.

Company executives are good at weighing hard costs. They’re not so good at evaluating how soft costs affect the bottom line, which is the main reason the stress issue hasn’t come to the forefront until recently. Based on research studies and information from the book, Stress Costs, Stress Cures by author Ravi Tangri, there is now a formula for measuring the hard costs of stress.

  • 19 percent of absenteeism;
  • 40 percent of turnover;
  • 55 percent of employee assistance programs;
  • 30 percent of short- and long-term disability;
  • 10 percent of drug plan costs;
  • 60 percent of total workplace accidents; and
  • Total costs of workers comp and lawsuits are because of stress.

Stress is a major issue. Yet it’s amazing that so many CEOs and CFOs focused on increasing profitability and having committed employees either sidestep the whole issue of workplace stress or they’re clueless as to what it’s costing their companies. Again, stress isn’t an intangible cost — it’s measurable in hard dollars.

Although the hard-hitting numbers are undeniable, most companies haven’t yet developed strategies to combat stress in the workplace. These include effective training in individual skills as well as addressing sources of stress in business practices and processes, organizational structures and company cultures.

If leading contact centers follow best practices regarding management, sales, marketing, training and other key areas of business operations, it makes good business sense to incorporate best practices in reducing workplace stress, too. Now is the time to take action on the human resources and financial costs of workplace stress overload — the $300 billion profit killer.

Ron Ball is president of Inroads, LLC, a speaking, training and consulting firm that offers programs to help organizations and businesses reduce stress to increase employee commitment and boost corporate profits. Ron can be contacted at ronball@inroads.cc or at 703-255-5261. Visit www.eustress.net or www.stress-sucks.com.

If you are interested in purchasing reprints of this article (in either print or HTML format), please visit Reprint Management Services online at www.reprintbuyer.com or contact a representative via e-mail at reprints@tmcnet.com or by phone at 800-290-5460.

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