Are Companies Paying Attention to Employee Stress & Burnout?

Are you dreaming of an exotic vacation to Tahiti, Switzerland or Jamaica?

Are you ready to put down your computer, blackberry and rolodex and just take a few needed days off? Are you saying to yourself, yes, I’d love to do that….but I can’t because I have too much work, my team needs me, I’ll lose my job….

This is the $1 million question: Do we work to live, or do we live to work? In the U.S., this question hits home harder than in other industrialized nations. The American "work ethic" seems to make sense from a productivity level, but in reality is antithetical to our basic human needs. The human brain and body need a break. And yet, the U.S. worker is the hardest-working employee on the planet, and this may not necessarily be a good thing.

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Let’s look at some startling facts:

• U.S. workers gave back $21 billion to their employers by not taking vacation last year. Still, that brought no joy to many in the executive suite, who noted that companies lost $150 billion in 2007 in healthcare costs related to worker burnout. –www.courierpostonline.com
• Middle-aged women who took vacations very infrequently (defined as once every six years or less often) had eight times the risk of either having a heart attack or dying of heart disease. –Researcher Elaine Eaker
• Employees who are overworked (i.e., those who do NOT take vacations) are more likely to make mistakes, be angry at their employers and colleagues who don’t work as hard, have higher stress levels, feel symptoms of clinical depression, neglect themselves and report poor health. –Families and Work Institute

Is this living the American Dream?

This cultural propensity for working hard helps make the U.S. the richest nation on earth, but at what cost? There's a widespread feeling among U.S. workers that they must work more hours to get ahead in their careers. Although many employees yearn to work fewer hours, experts say they are often loath to ask for a decrease in hours for fear they'll be branded as indolent or uncommitted to their job (Vedantam 2006). This dynamic can lead to overwork, work related stress and burnout and a range of problems that stem from exhaustion: A greater risk of heart disease, ulcers, increase in depression and other mental illness. Rather than increasing the company’s profits, overwork can result in increased health care costs, lack of productivity and absenteeism, ultimately reducing the company’s bottom line and the employees take home pay.

Most employers are aware that they're involved in a kind of balancing act. They have to boost output and employee productivity even while struggling to shrink employee turnover and keep employee morale buoyant. Employers can lose talented workers because the system filters out otherwise productive workers who don't wish to work long hours for years at a time (Vedantam 2006). Work related stress and burnout was, in fact, cited as a principal driver of employee turnover by three-quarters of U.S. workers surveyed in 2006 by the online career site CareerBuilder.com ("Many Actions," 2006).

So what is the alternative?

Should we question the American work ethic as a way to increase employee productivity and turn the economy around? Will company profits go down if business and personal travel is encouraged? Could it be possible that taking a few days off will not only give the employee a well deserved break, but will infuse the economy at the same time?

Oxford Economics found that for every dollar invested in business travel, companies realize $12.50 in incremental revenue. On the incentive front, "The Return On Investment of U.S. Business Travel" found that pure incentive travel only accounts for five percent of the average company’s business travel budget, and the median return on a $1 investment in incentive travel is $4. The $4 return on investment for incentive travel was similar to that of conferences and trade shows, both of which produce ROI of $4 to $5.99.

Pointing to that $12.50 in ROI, derived from 13 years of government statistics, Adam Sacks, founder and managing director of Oxford Economics adds: "The bottom line of the analysis is that for every dollar that the average U.S. company spends on business travel, that dollar yields an incremental $3.80 in profits."

Incentive travel is much less expensive than the cash equivalent of a raise and can be much more effective. People actually enjoy going on vacation, especially when the company has paid for or encouraged it. The "Bragging Rights" of a fully paid vacation go a long way for a high performing employee, and this is one perk that can be shared with the spouse or significant other, thus enhancing the personal life of the employee as well.

"What does that mean in terms of that return on that investment? "Sacks continues," This is an interesting way to think it through: If we assume an employee’s base salary is $100,000, that 8.5 percent increase in compensation would be $8,500." Figuring the average cost of a three-to-four-night incentive trip plus airfare and expenses is $2,000, Sacks says, "it would have cost them more than four times as much to get the motivation and productivity benefit that the incentive trip would have produced."

That is why Sacks says one of the takeaways from Oxford Economics’ study is "cash is an awfully expensive way to motivate people."

Most of us understand there is a strong relationship between travel and employee performance and satisfaction. The Oxford report continues: "The ‘sharing of ideas’ was confirmed by 76 percent of travelers as a benefit of internal travel, indicating travel to be an investment in human capital. The majority of business travelers identified internal company travel as key to professional development (66 percent), job performance (58 percent), and morale (56 percent). And more than 40 percent of travelers perceive a strong relationship between travel and staff retention."

It is important to note that "human capital" not numbers is what drives employee productivity and profits. It’s up to companies to look long term and evaluate how cut backs and holding the iron fist over employees may in fact have a negative impact on the bottom line. Sacks concludes, "It’s up to companies to evaluate the research’s implications for their decisions. But at Oxford Economics, we believe that decisions to cut travel are very short-sighted. There are indeed bottom-line benefits to be realized in the immediate horizon, but over a 12-month period, we’ve seen that cuts in business travel would generally be pennywise and pound-foolish."