Nearly three-quarters (73%) of business leaders believe their organisations are well-prepared to manage mental health concerns in their workforce, according to new research from leading independent consultancy Barnett Waddingham. However, under half of these businesses are collecting comprehensive data on mental health conditions impacting their employees, highlighting significant gaps in understanding the full scope of the issue.
The study, commissioned by Barnett Waddingham, surveyed 301 HR Directors and C-Suite business leaders in UK companies. It revealed that nearly two-thirds (64%) of businesses have seen a rise in absenteeism due to mental health issues, affecting employees across all age groups. Despite this, just two fifths (41%) of these businesses have responded by increasing their spending on mental health support, while under a third (28%) said they had boosted training around mental health challenges.
Business leaders also said that they had observed mental health services being most utilised by younger employees, with 69% believing these services were well-utilised by staff aged 25-34. Notably, mental health issues were most prominently observed in this younger cohort, with 51% of business leaders reporting a significant impact among employees aged 25-34, compared to decreasing concerns among older workers.
Despite the clear prevalence and potential impact of mental health , few businesses are actively tracking data that relates to these issues. Less than half of leaders (44%) actively collect data on incidences of anxiety, and the same number (44%) on depression. Slightly more (46%) collect data on stress-related disorders. This lack of data collection hinders efforts to accurately assess the scope of the problem, identify employees at risk, and implement effective support measures.
With an intersection of mental health and neurodiversity, it’s critical that employers are aware of the neurodiverse make-up of their staff. However, 38% of business leaders don’t believe they’ve had any incidents of cognitive conditions like dementia or Alzheimer’s, while 28% and 23% reported no incidences of learning difficulties or neurodiversity like ADHD or autism. This means many leaders are operating in the dark when it comes to conditions that may impact mental wellbeing at work.
These findings underscore the need for businesses to prioritise the mental wellbeing of their workforces. Failure to do so can lead to significant financial and productivity implications. By neglecting to track mental health conditions, businesses may miss opportunities to address issues early, potentially resulting in increased absenteeism, decreased employee morale, and reduced productivity. Investing in mental health support programs can not only improve employee satisfaction but also enhance overall business performance.
Looking ahead, businesses recognise the importance of addressing the issue. Two-fifths said that they (40%) see strengthening mental health support programmes as a key strategic priority, with 38% of businesses planning to implement mental health support programmes, while others are adopting phased returns to work (34%) and offering greater flexibility in working arrangements (31%).
These steps that businesses are taking are essential in overcoming this stigma and helping to increase economic inactivity, which rose by 350,000 between May 2023 and May 2024, according to official ONS data. This is especially true given the most prevalent health condition among those economically inactive because of long-term sickness is depression, bad nerves or anxiety.
Barnett Waddingham provides data-driven workplace wellbeing consultancy, focusing on employee engagement and productivity. They understand that happy and resilient employees contribute more to organisational success, and they offer innovative solutions to improve employee physical, financial, and mental health.
Julia Turney, Partner, Platform and Benefits at Barnett Waddingham, says: “It’s clear there is a stark clash between employers’ perceptions of their mental health support structures, and the reality. Business leaders are operating with naive optimism that they have the right systems and processes in place to support their staff, but they’re working blind – they don’t have the visibility of data or metrics needed to make change.
“This is more timely than ever. The UK’s mental health crisis is having a tangible impact on our country’s growth and productivity. With a significant portion of the 2.8 million economically inactive Brits off work due to mental health concerns, this must be a priority to relieve pressure on the NHS, improve day-to-day health and wellbeing, and get the country back to work. Employers are a critical part of the ecosystem, and without accurate insights into workforce challenges, effective solutions are impossible. By implementing robust data capture and analysis of time off sick, causation, and benefit impact, organisations can better understand and improve employee wellbeing for the long term.
“The buck does not stop with businesses. The Autumn Budget is an opportunity for progressive policy and proactive intervention from the Government. Employers are leaning on private medical insurance to plaster over the cracks in the NHS’s support of mental health, financially justified as being better than dealing with absence. But medical inflation continues to increase, and costs are becoming unwieldy. The Government could support by offering tax rebates on preventative health benefits, guidance around employee care pathways, and incentives to insurers to invest in research & innovation.”
