COVID-19 places a heightened emphasis on mental health
Companies must focus on the social factors that can influence employee performance.
The COVID-19 crisis forced organizations worldwide to make immediate decisions about how to protect their employees from a mysterious, fast-spreading, sometimes deadly pathogen. Among their actions were requiring employees and customers alike to wear face coverings, deploying testing, adopting best hygiene practices, rolling out health monitoring and reporting apps, and encouraging people to work from home. In short, businesses quickly acted on the social determinants of health by adapting policies and physical environments to protect employee and customer well-being.
Once largely the purview of governments and social services organizations, social determinants of health in recent years have begun to draw employers’ attention. As a 2019 PwC report notes, businesses have a role to play, not just as individual actors addressing the social factors affecting their workers’ health, but as partners in collaborations addressing community-wide needs. The COVID-19 outbreak intensifies the urgency for employers to address these issues. That’s because beyond directly threatening employees’ health, the pandemic aggravates many social factors that can harm workforce and community well-being.
As we mark World Mental Health Day on October 10, it is important to note that mental health already was an important social determinant before COVID-19. Worldwide, nearly 1 billion people have a mental disorder, 3 million people die every year from alcohol abuse, and one person dies every 40 seconds by suicide, according to the World Health Organization, United for Global Mental Health, and the World Federation for Mental Health. Yet countries, on average, spend only 2 percent of their health budget on mental health. In low- and middle-income countries, more than 75 percent of people with mental, neurological, and substance-use disorders receive no treatment for their condition.
The pandemic has aggravated matters. “The mental health and well-being of whole societies have been severely impacted by this crisis and are a priority to be addressed urgently,” states the United Nations’ policy briefPDF on the issue.
Mental well-being and business intersect
Even before COVID-19, mental health was recognized as a social issue with business implications. Worker anxiety and depression are tied to increased rates of absenteeism, employee turnover, distraction, and poor performance on the job. The global economy loses about US$1 trillion annually in productivity because of depression and anxiety, according to the World Bank. Additionally, mental, neurological, and substance-use disorders are estimated to contribute to yearly economic output losses of $2.5 trillion to $8.5 trillion worldwide.
This occurs even though every $1 invested in scaled-up treatment for common mental disorders, such as depression and anxiety, yields a $5 return in improved health and productivity, according to the World Health Organization, United for Global Mental Health, and the World Federation for Mental Health.
Many employers in recent years have attempted to address employee mental well-being. The vast majority (95 percent) of employers around the globe now include emotional and mental health programs in their corporate well-being platforms, according to a survey from Fidelity Investments and the Business Group on Health that was fielded between October 2019 and January 2020. It found that for 2020, 69 percent of the 152 responding businesses planned to provide mental health tele-therapy, and 50 percent planned to offer stress management assistance. Additionally, 78 percent of employers include work–life balance within their well-being platforms in the form of caregiver support (46% percent), programs and tools for new parents (36 percent), and child-care support (35 percent).
In all these efforts, the pandemic has undoubtedly upped the stakes. Employees’ mental well-being is being threatened by the prospect that they or their loved ones will contract the virus, by reduced job security in an uncertain economy, and by new child-care obstacles posed by remote work and the continuation of online learning at many schools. Social-distancing requirements and remote work are aggravating social isolation. There are also heightened risks of domestic and family violence.
In a survey of 1,210 people from 194 cities in China early in the pandemic, 54 percent rated the psychological impact of the outbreak as moderate or severe. In the U.K., the government’s Office for National Statistics found nearly 20 percent of adults were likely experiencing some form of depression in June — nearly double the pre-pandemic level. A March and April survey performed by the U.S. firm Qualtrics of 2,000 employees in Australia, France, Germany, New Zealand, Singapore, the U.K., and the U.S. found that 41.6 percent believed their mental health had declined since the COVID-19 outbreak.
The increased anxiety is hurting employee performance. In the U.S. alone, sustained attention among workers — the driver of task completion — dropped 31 percent by August, compared with the pre-pandemic February levels, according to findings from the Mental Health Index: U.S. Worker Edition, tabulated by Total Brain, a self-monitoring and self-care platform. Planning, defined as the capacity to make decisions and drive strategy, was down 15 percent in the same period.
In the U.S. alone, sustained attention among workers — the driver of task completion — dropped 31 percent in August, compared with the pre-pandemic February levels.
Employers anticipate that increased mental health pressure will cause more employees to seek services in the coming 12 months, according to the June PwC reportPDF on medical cost trends. In a survey conducted by the PwC Health Research Institute, 12 percent of U.S. consumers with employer-based insurance said they sought help for their mental health as a result of the pandemic. An additional 18 percent reported plans to access mental health care.
The utilization rise will further strain companies’ bottom line and governments’ coffers, as well as exacerbating pressure on insurers. In Victoria, Australia, the state with the country’s most COVID-19 cases, the federal government recently dedicated AUD$26.9 million (US$19.3 million) for 15 new mental health clinics to meet the increased demand for services sparked by the outbreak, part of a $31.9 million (US$22.8 million) mental health package for the region. In addition, telehealth changes were put in place to enable primary care to be provided virtually and funded.
Companies step up
Given the magnitude of the pandemic’s mental health impact, employers are embarking on new initiatives or strengthening existing programs. Companies have used a variety of approaches, including encouraging employees to take time off for their mental health, holding virtual town halls to address employees’ worries, and expanding workers’ health benefits and programs (especially digital ones).
In April, Starbucks began offering its U.S. employees and eligible family members access to 20 free sessions a year through California-based mental health benefits provider Lyra Health, which offers virtual appointments and digital lessons. Starbucks also made related training sessions available to store managers in the U.S. and Canada in partnership with the National Council for Behavioral Health.
PwC US introduced new benefits to address employees’ needs during COVID-19 by redeploying executive coaches to provide one-on-one and group well-being coaching sessions, chief people officer Michael Fenlon noted in a recent blog post. PwC UK has made Garmin watches available to 1,000 employees to track how they are coping with stress during the pandemic.
Because of new ways of working and a blurring between professional and personal boundaries, companies are seeking ways to help employees get downtime and recharge. PwC India last summer instituted a firm-wide “Pens Down Day,” in which employees were urged to take a Friday off and cancel all meetings.
In August, the Hong Kong office of global insurance firm AXA launched AXA BetterMe, a wellness platform with a suite of programs covering physical wellness, mental well-being, and chronic disease management. It includes a mindfulness meditation tool with modules guided by a yoga instructor. The firm is also offering a free guide, coauthored with the Columbia-WHO Center for Global Mental Health, to help companies safeguard the well-being of their employees as they return to work.
Of course, employer efforts to address mental health issues among their employees, or address them more broadly, cost money. But they should be regarded as investments companies must make in order to operate safely in this new environment, much like providing masks or testing, or revamping office space.
The cost of inaction — lower productivity, increased employee turnover, and employee absenteeism — is high. Businesses can expect to receive, on average, $2.30 for every $1 spent on effective mental health initiatives for employees, according to a reportPDF prepared by PwC Australia. The return jumps to $3.60 for financial-services firms.
In fact, the pandemic presents a new opportunity to make mental health spending more efficient. As healthcare providers around the globe abandoned in-person care for nonessential services in order to help slow the spread of the virus, governments and private payors removed barriers to virtual care. The result has been a boom in virtual care, including mental health treatment. This shift holds the promise of savings, because virtual care is typically less expensive, as the PwC US report on medical cost trends notes.
More widely, though, investments in mental health send an important signal. In service-based and knowledge-based economies, employees’ minds are companies’ greatest asset. Investment in employee well-being pays off in enhanced engagement and creativity, increased productivity, and improved retention rates. It also helps businesses recruit and retain the best talent, especially among younger workers, many of whom expect their employer to be mindful of work-related stress and to have programs and policies that support employee mental well-being.
It’s not enough to simply roll out a program and make it available. The success of mental wellness initiatives hinges largely on workplace culture and the tone set by company leadership. Building on a PwC UK initiative launched in 2015, PwC Australia, in 2018, launched its Green light to talk program, an initiative aimed at eliminating the mental health stigma. It engaged 13 partners to share their stories to show employees that opening up about a mental health problem wouldn’t damage their career. These partners have become “mental health advocates” with whom employees can confidentially connect to discuss their well-being. In FY21, all PwC Australia employees are encouraged to complete a well-being plan, and all partners must detail the actions that they will take to “prioritize and support our people’s mental health and well-being” as part of their partner personal plan.
As we approach World Mental Health Day, it is important to have a sense of urgency about this issue. Employers are rethinking and reconfiguring their organizations to succeed in a post-pandemic future. As they do so, they can take a fresh look at the intersection of social problems and their businesses, reflecting the increased focus on ESG issues, and develop new strategies that benefit their employees, their communities, and their bottom line.
- Rana Mehta is leader of healthcare for PwC India. Based in Delhi, he is a partner with PwC India.
- Sarah Butler leads the healthcare practice for PwC Australia. Based in Sydney, she is a partner with PwC Australia.
- Damien Angus advises healthcare clients for Strategy&, PwC’s strategy consulting practice. Based in Melbourne, he is a partner with PwC Australia.