April 26, 2021

What is the Return on Workplace Wellness?

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What is the Return on Workplace Wellness?

The biggest myth surrounding workplace wellness is that it doesn't provide tangible, measurable benefits. But this is simply not true. Well-executed and well-designed wellness programs can not only be contributors to a company's bottom line, but can also be drivers of its employee retention and cost-saving goals. This starts with reducing the amount of time lost due to sick days based on employee health.

Employee Health Drives Workplace Wellness ROI

When business leaders learn that workplace wellness can financially contribute to a company's success, their next question is often 'How?' Workplace wellness initiatives typically centre around the idea of promoting, supporting, and facilitating the healthy habits and activities that contribute to an employee's overall well-being. When successful, these programs can significantly improve the general health of one's workforce and significantly reduce the number of medical expenses required to sufficiently support them.


Despite being over 10 years old, no workplace wellness article is cited more than that of the Harvard Business Review's “What's the Hard Return on Employee Wellness Programs?” This piece of human resource academia cites one of the most impactful studies on workplace wellness in the 21st century. 

Doctors Richard Milani and Carl Lavie took a random sample of 185 workers and their spouses and measured both their health status and medical claim costs over a six-month period. These participants were split up into two groups: one that participated in a wellness program and one (the control) that did not. Following the testing period, it was found that 57% of the wellness participants who were classified as being high-risk in terms of health-related complications (according to measures such as blood pressure, body fat, etc.) were converted to low-risk status by the end of the six-month program. The average medical claim costs of those who participated in the workplace wellness program were $1,421 less than the claims from the previous year. The control group, unsurprisingly, showed no improvements in terms of health or cost-savings. Moreover, the ROI of this health initiative was shown to be upwards of $6 per dollar spent.

What makes this data so timeless is the continued relevance of certain health conditions, such as heart disease and hypertension, as well as the price of medical claims. The quality of this return on investment, however, depends on the quality of one's workplace wellness initiatives.

Optimizing the ROI of Your Workplace Wellness

In a 2019 study conducted by Deloitte, researchers found that the median yearly ROI on workplace mental health initiatives was nearly 35% greater for companies whose programs had been in place for three or more years, increasing from $1.62 to $2.15 per dollar spent. What this study illustrates is that workplace wellness programs, when built from the ground up, increase ROI results over time.  Building workplace wellness is a long term strategy and with  500,000 workers unable to perform their job each week do to poor mental health, it is an essential one for any organization.

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 The return on investment of a company’s workplace wellness depends on the number of employees who participate. For instance, using study from the HBR article referenced above, organizations with highly effective workplace wellness programs reported significantly less employee attrition (9%) compared to those whose programs had low effectiveness (15%). Not only is it important in this case to have as many employees participating as possible, but it is also important to ensure that the quality of programming is high.  

To learn about Sprout’s strategy of educating, engaging and inspiring employees to drive participation for higher ROI, book a discovery call today.

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