By: Andrew Berry
During the great resignation, a period of unusually high turnover and job quitting that followed the tail end of the COVID-19 pandemic, many employers began to examine the actual cost of hiring a new employee versus retaining a current employee. Estimates varied widely, from the Society for Human Resource Management’s (SHRM) average cost of $4,700 to the talent management and development company E.L. Goldberg & Associates’ calculation of three times annual base salary.1 Experts agreed on the hard costs: posting on job boards, hiring recruiters, conducting background checks, etc. Soft costs were where experts varied – the value of time supervisors spend on training, the hours subject matter experts spend educating new employees, and the loss of tribal knowledge tenured employees build over years and decades.
The same is true when it comes to work injuries. Every workplace injury has baked-in costs – medical expenses, workers’ compensation claims (where applicable), and any legal expenses that arise from potential litigation related to the incident. These direct costs, however, are often dwarfed by the downstream indirect costs of an injury – lost productivity, administrative burdens, decreased employee morale, and other discrete costs.2 A single injury can weigh down a department, work shift, or business. Not all accidents and workplace injuries are preventable, but employers can work to minimize their occurrence and impact by partnering with an experienced occupational health provider. With the help of an occupational health industry leader like Concentra®, employers can implement proven employee injury prevention strategies and ensure their employees receive best-in-class injury care.
What are the hard costs of a work injury?
A study by the National Safety Council (NSC), a non-profit safety organization, found that the average medically consulted injury costs around $43,000.3 The study also found that the total cost of all workplace injuries was $176.5 billion, including wage and productivity losses, medical expenses, administrative expenses, and employers' uninsured costs. This added up to a cost per worker of $1,080, including the value of goods or services each worker must produce to offset the cost of work injuries.3 The hard cost of a fatal workplace injury, according to NSC, is $1.46 million.
The Occupational Safety and Health Administration (OSHA), which uses a combination of medical expenses, rehabilitation costs, disability payments, and legal fees to calculate direct workers’ compensation costs, estimates that American employers spend about $1 billion per week on employee injuries.4 Additionally, to help raise awareness of how occupational injuries and illnesses can impact a company's profitability, OSHA offers its Safety Pays Individual Injury Estimator, which allows employers to project the sales a company would need to generate to cover the costs of more than 50 specific injuries.
What are the indirect costs of a work injury?
The most significant indirect cost from a work injury comes from lost workdays. The NCS study found that approximately 103 million workdays were lost to injury a year.3 This figure is derived from only the work hours missed and does not include time spent receiving further treatments and check-ups. As other colleagues work to fill in for the injured employee, they also lose productive hours at their positions. Other indirect costs include:
- Workplace disruptions
- Decreases in employee morale
- Training costs for new or replacement employees
- Possible insurance premium increases
- Administrative expenses
- Potential OSHA fines, depending on the nature of the injury
Estimates vary on the total dollar amount of indirect injury costs, but some studies have shown these totals to be four to 10 times more than the direct injury costs. Insurance experts believe that for every $1 of direct accident costs, there are $3 of indirect costs.5
Cost Control
Accidents can occur even in the safest workplaces. Still, employers may be able to reduce their health and safety costs by working with an experienced occupational health provider that deploys a dual-pronged approach of forward–thinking injury prevention and expert injury care.
Prevention
Multiple studies have shown that injury prevention programs yield significant return on investment and could save employers billions annually. A Liberty Mutual study found that $1 invested in injury prevention programs returns $4 to $6 in savings through a combination of direct and indirect costs: higher productivity (indirect) and injury avoidance (direct).6 OSHA studies have shown that adopting injury prevention programs can have substantial benefits, potentially saving employers between $9 billion and $23 billion annually in employee compensation costs.7
Employers can help prevent employee injuries through proper ergonomics and pre-work routines. Warm-up and stretching programs designed by an athletic trainer help employees learn the correct way to prepare their bodies for physical activity and reduce the risk of injury. These programs have been shown to improve balance and enhance muscle coordination.8 More than simple stretches, an athletic trainer-designed warm-up routine can be designed to ensure employees’ bodies are ready for their specific tasks.9
Beyond warm-up and stretching programs, employers can also invest in exercise guidelines, train-the-trainer programs, and ergonomic interventions. These types of soft tissue injury prevention programs can help physically condition employees and properly educate them on risk factors to prevent cumulative trauma and workplace injuries.10 These programs are most effective when a certified athletic trainer or physical therapist can integrate at the worksite, assessing risks and examining employees' tools and body mechanics as they work. Ongoing safety and ergonomic programs help build a safety culture and create a work environment where employees are happier, healthier, and more productive – a direct contrast to indirect costs, like low morale, that can fester after an injury occurs.
Treatment
Regarding injury treatment, employers should look to an occupational health partner that provides quality care and focuses on getting employees back to work and life as soon as their bodies allow.
Concentra uses a specific approach to pain and injury care that improves the quality of injury recovery and helps accelerate return to work. Our FReSH® scale, an acronym for Functional Restoration/Status of Healing, reframes the injury recovery experience for the injured employee. Physical therapists determine objective measures that consider the severity of the injury, the individual, and a functional analysis of the job the individual was performing at the time of injury.11 By focusing on function, not pain, our clinicians are able to gradually reduce restrictions on the employee’s activity status based on the established objective evaluations of progress. Employees treated using the FReSH scale often experience increased productivity and diminished anxiety, and recover more quickly.
This article was provided by Concentra, the nation's largest occupational health provider. Want additional insight into the physician job market and assistance navigating your search? OEM | Exploregives the capability to control your career search and find the best fit for your professional journey. With exclusive insights and real-time updates through a comprehensive, map-based platform, you can be sure to find the job that's the right fit for you. Don't wait, sign in and get started with ACOEM's premier career platform today.