Employee absence ranked sixth concern by employers
December 18, 2018
Research published today by insurer Zurich reveals which business risks present the most pressing concerns to UK businesses.*
The survey of financial decision makers shows that economic uncertainty ranks first, with 43% of respondents highlighting it as a major risk, with employee risk - including absence and health ranking only sixth (25% of respondents).
This is despite the fact employee absence is estimated to cost the UK economy around £18bn per year in terms of lost productivity.**
Technological risk, including cyber and data security were ranked as the second major concern (39%), followed by financial risk - such as increasing operating costs - and competitor activity (both 33%). Reputational risk was a major concern for 32% of respondents.
Interestingly, when looking at different business sizes however, employee risk was ranked far more highly among larger employers, with 40% seeing it as a major problem, compared to just 22% of smaller organisations. Likewise, technological risk was seen as more of a threat to larger businesses compared to those smaller (52% v 36%).
When asked about the single biggest impact of employee sickness on their businesses, loss of productivity came out highest for just under a third (32%), followed by 23% who said it caused a strain on management time, and 17% who said the loss of expertise from their business was their biggest concern.
Just 15% of respondents said they provided group income protection for their employees, with variations when it came down to organisations’ size. Nearly half (45%) of large businesses compared to 23% of medium and only 8% of small businesses provide this benefit.
Zurich’s Nick Homer, Head of Market Management, Corporate Risk said, “The fact that larger employers rank employee risk more highly would suggest that they’ve experienced at first hand the impact of losing an employee to long term illness or injury. As a result, larger employers are also more likely to have some sort of group income protection provision in place for their employees.
“While the benefits to employees are clear – both replacement income and rehabilitation support – there are clear benefits to employers, including business continuity and retaining critical skills and expertise.”
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* Yougov research during March 2018 – 500 respondents financial decision makers omnibus - British businesses
** Analysis from Centre of Economic and Business Research 2018