“Well, it turns out that a comprehensive, strategically designed investment in employees’ social, mental, and physical health pays off.” – Harvard Business Review
Harvard Study Finds $250 Million In Savings for Johnson & Johnson From Wellness Programs
Long-Term Savings Comes In Many Forms
The obvious benefit of a new employee wellness program is the systematic focus from leadership to improve the individual health of employees.
But, the results don’t end there. The Harvard study reveals that “Government incentives or not, healthy employees cost you less.” Meaning, the long-term savings of a well-managed employee wellness program can save every business money. And, it wasn’t just Johnson&Johnson who were found to have benefitted from huge financial savings in the study. There were other businesses with strikingly clear results.
In addition, the report outlines other factors that arose that played a role to increase savings. Take declines in lost work days, for example.
Decline In Lost Work Days
In 2001 MD Anderson Cancer Center created a workers’ compensation and injury care unit within its employee health and well-being department, staffed by a physician and a nurse case manager. Within six years, lost work days declined by 80% and modified-duty days by 64%. Cost savings, calculated by multiplying the reduction in lost work days by average pay rates, totaled $1.5 million; workers’ comp insurance premiums declined by 50%. – Harvard Business Review
Not only do employees tend to take off less days as a result of a wellness program, they tend to stay at their jobs longer.
Employees Staying at Their Company
Healthy employees are more likely to not leave their position at their company, a Harvard says. Towers Watson and the National Business Group did another study on this issue. Their research showed how “organizations with highly effective wellness programs report significantly lower voluntary attrition than do those whose programs have low effectiveness (9% vs. 15%).”
At the software firm SAS Institute, voluntary turnover is just 4%, thanks in part to such a program; at the Biltmore tourism enterprise, the rate was 9% in 2009, down from 19% in 2005. According to Vicki Banks, Biltmore’s director of benefits and compensation, “Employees who participate in our wellness programs do not leave.” Nelnet, an education finance firm, asks departing employees in exit interviews what they will miss most. The number one answer: the wellness program. – Harvard Business Review
The evidence is clear: wellness programs are valuable for many reasons, not least of which is happier, healthier (and longer-tenured) employees.
