Preventing Workplace Mental Health Injuries Saves Billions: New Research

Australia Institute

New research

from the Australia Institute’s Centre for Future Work suggests that by requiring stronger monitoring and prevention measures in Australian workplaces, a significant share of mental illness and injury could be avoided. In addition to reducing the toll of mental illness for workers and their families, these measures would also generate substantial economic and fiscal benefits.

Unsafe workplaces contribute significantly to the incidence of mental illness and injury. Workplace factors that contribute to mental health problems include unreasonable job demands, exposure to violence and trauma, long or irregular working hours, an absence of worker voice and control, and bullying and harassment.

The new report surveys the range of costs arising from workplace-associated mental ill-health: including reduced labour force participation, absenteeism, reduced productivity, high employee turnover, workers compensation costs, and others.

Key findings of the report include:

  • Preventing mental health problems caused by work-related factors and stressors would expand Australian GDP by $3.5 billion per year, and reduce government expenses (for health care and other services) by $2 billion per year.
  • Between 15% and 45% of mental illness among employed people is linked to workplaces factors and stresses.
  • Total costs to society from workplace-associated mental illness (including direct costs to victims and their families, as well as economic and fiscal costs) are estimated at $15.8 billion to $17.4 billion per year.
  • Even before the COVID-19 pandemic, one in five Australians reported mental health challenges. And the total costs of mental illness for Australia’s economy, government, and society are staggering: estimated by the Productivity Commission (2020) at $200-220 billion per year.

“Mental illness is complex and not fully understood. But there are many identifiable risks and dangers which are known to cause mental illness and injury, and which can be prevented. Sadly, many of those dangers are commonplace in Australian workplaces,” said Dr Jim Stanford, director of the Australia Institute’s Centre for Future Work.

“Australia’s system of work health and safety laws does not treat workplace mental injuries with the same rigour and oversight as physical injuries. This has to change.

“We need explicit, enforceable requirements that compel employers to take mental health risks just as seriously as physical health and safety risks, and make every possible effort to remove those risks.

“The economic and fiscal benefits of preventing workplace-associated mental illness and injury are substantial – and would be shared by employers, governments and workers alike,” Dr Stanford said.

The report urges state and federal WHS ministers, in their current review of Australia’s model WHS laws, to modernise Australia’s practices – and catch up with other industrial countries which take workplace mental health injuries more seriously.

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