Shortcuts Lead To Deep Cuts – The Impact Safety Has On Your Bottom Line
As a business owner, you are always looking for ways to improve your ROI. A good bottom line is necessary for the health of your company. Many business owners do not recognize the monetary implications of safety non-compliance and/or complacency. The impact of employee injuries can significantly lower your profits. Fortunately, there are preventative steps companies can put into action.
Have you implemented the right safety procedures and training? The benefits of safety in the workplace not only protect your employees, they protect your ROI. A good safety program can make a huge difference in avoiding workplace injuries, especially in trades such as manufacturing and construction. Many business owners do not know the monetary implications of not keeping up with safety, aside from the potential impact on morale and the high cost of employee injuries.
The Cost of On-the-Job Injuries
Did you know that the cost of employee injuries nationwide is more than $1 billion a week? That's the amount Liberty Mutual estimated employers paid in direct compensation for disabling, nonfatal workplace injuries in 2018, per the 2021 Workplace Safety Index. Additionally, the National Safety Council estimated the total cost to employers and individuals of work-related injuries and deaths in 2019 as $171 billion.
These might be nationwide figures, but they illustrate the size of the problem. These direct costs are not the only ones you might experience, however.
Without employee injury prevention, there are some other costs you might incur:
- Lost sales. For example, if employees miss work due to an injury and production suffers, you may lose business to a competitor.
- Additional costs for training replacement workers if an employee is out for an extended time due to an injury or permanently disabled and unable to return to their former position.
- Lost productivity when a workplace injury occurs may only be time missed for medical appointments or extensive time periods for recovery. Productivity may also be lost from damage to equipment impacted by the accident.
- There is an indirect cost of time and effort to process and manage workers' compensation claims as well as developing a return-to-work plan.
- One of the hardest costs to ‘measure’ is the quality of life for those impacted by workplace accidents. The injured employee, their family, and even co-workers can be negatively impacted by a preventable incident. Oftentimes, an entire company can experience reduced morale and thus productivity.
Top Causes and Costs of Common Workplace Injuries
The key to having a good safety program is understanding the top causes of injuries in your trade or industry. Some things are valid across the board, while others are more specific. Here are some of the most important causes of workplace injuries relevant to nearly all industries.
Overexertion happens when your workers lift, push, or carry heavy objects, leading to sprains and strains. Causes include poor lifting techniques, not seeking help when needed ("No, I got it"), or not having the right equipment. In 2018, overexertion caused about 23.5 percent of the total cost of injuries ($13.7 billion). These injuries can even happen in the office when people lift and move heavy files or attempt to rearrange furniture without help.
Trips, Slips, and Falls
These accidents can happen at any workplace. People might slip on a wet floor, trip over a cabinet door, or fall over cables that haven't been adequately secured. These kinds of falls accounted for $11.2 billion in workers' compensation costs in 2018.
Falls From Heights
Whether inside an office or outside at a construction site, any employee that uses a ladder, even once, is at risk from catastrophic injuries from falls. Even if they are only 6 feet off the ground. Of course, construction workers are at a higher risk as they work at heights more often and not just ladders, but also roof tops. These falls cost almost $5.9 billion in 2018.
Many employees must drive as part of their daily duties; either from one job site to another or to the post office, bank, etc. Anytime someone is on the road, they are at risk of being involved in an accident. Traffic accidents and subsequent injuries make up about $3.2 billion of the total costs.
Training content on defensive driving and/or the risks of distracted driving can greatly mitigate exposure to these hazards. Company policies should outline safe driving and set expectations for employees that are behind the wheel for business purposes.
Safe Workplaces Are More Profitable
According to OSHA, businesses that implement comprehensive safety programs can reduce injury- and illness-related costs by as much as 40 percent. It may not be possible or feasible to prevent all accidents, but you can avoid many of them.
Put it this way, just one injury requiring medical attention costs employers about $41,000. While workers’ compensation covers the medical expenses, as noted above there are many indirect expenses incurred by the employer. In addition, a pattern of claims increases premium costs.
Safety programs in the workplace have the following benefits:
Good safety policies prevent lost time caused by accidents or work-related illnesses. Safety practices can reduce damage to equipment which can slow productivity. Workers who feel confident that you care about their safety work harder and get things done with less anxiety.
Having an effective safety program sends a message to your employees that you care about them, improving morale and increasing loyalty. Accidents, on the other hand, tend to lower morale.
Fewer Healthcare Costs
Reducing the number of accidents minimizes the number of healthcare claims made. This lowers healthcare costs for employees (often left paying the balance) and lowers premiums for everyone.
Reduced Absenteeism and Turnover
Good safety doesn't only prevent catastrophic injuries but also minor ones which can result in short-term absenteeism. A safety program that includes concerns for contagious diseases can reduce the number of colds that go through a workplace. Accidents can lead to or increase turnover, as employees who value safety may seek employment at a safer workplace.
Building a Safer Workplace and Improving ROI with PRO
PRO Resources can help. We will work with you to build a safer workplace, which will increase your bottom line and create a better place to work, helping your company grow. Contact us about how we can help you improve safety and protect your employees.