Poor employee mental health isn’t just a “people issue” – it’s a serious business issue. When teams are unwell, organizations pay the price in lost productivity, absenteeism, turnover, and more. Recent research from both the UK and US reveals staggering figures: in the UK, poor mental health among employees is estimated to cost employers around £51 billion per year (Deloitte, 2024) and in the U.S. tens of billions more are lost in productivity annually due to mental health-related issues (Gallup, 2022). Globally, the scale is even more sobering – an estimated 12 billion workdays are lost each year to depression and anxiety, costing the world about $1 trillion in productivity (Spill Chat, 2025).
For HR leaders and CFOs, these aren’t abstract statistics but concrete hits to the bottom line. Below, we break down the real cost of unwell teams into key categories – absenteeism, presenteeism, turnover, burnout, and reduced productivity – drawing on the latest data (2023–2025) to illustrate why supporting employee well-being is a financial imperative for businesses today.
Absenteeism: When Stress Keeps Workers Home
Employee sick days have surged, and mental health is a major culprit. In the UK, workers were absent 7.8 days on average over the past year – the highest level in over a decade (Personneltoday, 2023). Stress and poor mental health now rival physical illnesses as top causes: about 28% of all UK sick days are due to mental health conditions (Spill Chat, 2025). In fact, work-related stress, depression, and anxiety led to 17.1 million working days lost in 2022/23 alone in the UK (Mental Health Foundation, 2024). This trend isn’t limited to Britain. In the United States, nearly one in five workers rates their mental health as “fair” or “poor,” and this group ends up taking quadruple the sick time of their healthier peers. On average, U.S. employees struggling with mental health report about 12 unplanned absence days per year, compared to just 2.5 days for those in good mental health (Gallup, 2022). The cost of these mental health-related absences is enormous – Gallup estimates $47.6 billion in lost productivity annually in the U.S. from the missed workdays of struggling employees (Gallup, 2022).
For HR, these numbers underscore that mental health is now one of the leading drivers of absenteeism. For CFOs, every day an employee is out is a direct hit to output – one analysis pegs the productivity cost at roughly $340 per day for a full-time worker (Gallup, 2022).Beyond the direct costs, there’s operational strain: missed meetings, delayed projects, and extra burden on coworkers. When almost 76% of organizations report stress-related absence in the past year (Personneltoday, 2023), it’s clear that mental well-being needs to be front and centre in absence management strategies.
Presenteeism: The Hidden Drain on Productivity
If absenteeism is the visible tip of the iceberg, presenteeism is the massive hidden chunk below the surface. Presenteeism occurs when employees show up to work but, due to poor mental health or burnout, cannot perform at their full capacity. They might be physically present, but their productivity, creativity, and decision-making are impaired. Studies show this silent problem can eclipse the cost of absenteeism many times over. In the UK, presenteeism is the single largest contributor to the cost of poor employee mental health – accounting for roughly £24–28 billion of lost output annually (Deloitte, 2024). This means people coming to work when unwell (and underperforming as a result) costs UK businesses 4–5 times more than mental health absences do (Spill Chat, 2025).
U.S. employers face a similar challenge. While harder to measure, one Harvard Business Review analysis estimated that presenteeism costs U.S. companies as much as $150 billion per year in lost productivity (Phys Org., 2024). Why so high? Consider an employee dealing with severe anxiety or depression – they might be at their desk for 8 hours, but accomplish only a fraction of what they (or a healthy colleague) normally would. They may also be more prone to errors or accidents. Unlike an absence, these performance losses often go unnoticed day to day, but they accumulate into a huge financial drain. In fact, some experts suggest the productivity loss from presenteeism can be 10 times greater than from absenteeism in aggregate (Wellhub, 2025).
🎯For HRs and managers: the key is to recognize the signs: an employee who is frequently working while ill, overly fatigued, or mentally checked-out is a risk to both themselves and the business. For finance leaders, it’s important to realize that hours worked ≠ productive hours when employees are unwell. Presenteeism is essentially paying full salary for partial output – an inefficiency no CFO would tolerate in any other business process. Reducing presenteeism through better well-being support can recapture significant lost value.
Turnover: Losing Talent, Losing Money
When mental health is neglected, companies don’t just risk people missing work – they risk people leaving work entirely. Employee turnover driven by burnout or poor well-being has become a serious (and expensive) problem. Replacing employees is costly in its own right – studies peg the cost of onboarding a new hire at roughly 10% to 30% of that position’s annual salary in recruiting, training, and ramp-up time costs (Plansponsor, 2025). But the indirect costs can be even higher: lost institutional knowledge, disruptions to team projects, and the toll on remaining staff who must pick up the slack.
Unfortunately, mental health is now a major factor in why employees quit. In the UK, 61% of employees who left a job (or plan to leave in the next year) cited poor mental health as a contributing reason (Spill Chat, 2025) . This is a stunning majority – it means more than half of attrition has a wellbeing component. The financial impact is reflected in the data: the annual cost of turnover due to mental health in UK companies ballooned by over 150% in three years, from about £8.6 billion in 2019 to £22.4 billion in 2021 (Spill Chat, 2025) . While some of this increase was likely exacerbated by pandemic stresses, it highlights a trend: more employees are voting with their feet when their job harms their mental health.
In the U.S., the “Great Resignation” of 2021-2022 underscored similar themes – surveys indicated burnout and mental well-being were top reasons people resigned without other jobs lined up. Younger generations especially are prioritizing mental health in their career decisions. A recent study found that 50% of Millennials and 75% of Gen Z workers have left a job at least partly for mental health reasons (Susan Leys, 2025) – a dramatic shift from older generations. Every departure is a hit to the bottom line. If a mid-level manager making $80,000 quits, the company might incur tens of thousands in recruiting and training costs for a replacement, not to mention months of lost productivity from that role. And if multiple people start exiting due to a toxic, high-stress culture, the turnover “snowball” can quickly damage performance and employer brand reputation.
🎯For HR leaders: these statistics highlight the importance of retention through well-being: supporting mental health can significantly improve loyalty and reduce costly churn. For CFOs, investing in retention saves hard dollars – it’s much cheaper to support and keep an experienced employee well than to lose and replace them.
Burnout: The Breaking Point of Performance
Burnout deserves special attention. It’s both a cause and a consequence across absenteeism, presenteeism, and turnover. The World Health Organization classifies burnout as an occupational phenomenon resulting from chronic workplace stress that has not been successfully managed. It manifests in exhaustion, cynicism, and reduced efficacy. Unfortunately, burnout is alarmingly prevalent in today’s workforce.
Recent surveys paint a worrisome picture. According to Deloitte’s 2024 report, 63% of employees surveyed are experiencing at least one symptom of burnout (up from 51% in 2021) (Deloitte, 2024). In some industries and demographics the numbers are even higher – for example, in one UK study, 79% of employees (and 82% in tech sector) reported feeling close to burnout (Spill Chat, 2025) . This means a large majority of staff are teetering on the edge of serious exhaustion and disengagement.
The impact of burnout is multifaceted. Physically and mentally, burnt-out employees are more likely to suffer illnesses, from anxiety and depression to hypertension and other stress-related conditions. Organizationally, burnout impairs job performance, leading to more mistakes and lower quality work (Plansponsor, 2025). It also increases absenteeism and turnover – burned-out individuals either take extended sick leave to recover or eventually quit in search of a healthier environment (Plansponsor, 2025). In other words, burnout acts as a force multiplier on all the costs we’ve discussed: it drives people to miss work, function poorly when they do work, and ultimately leave work.
The financial ramifications are huge. One Gallup study estimates that employee burnout is costing the global health care system $322 billion annually (Plansponsor, 2025) (this figure reflects healthcare expenditures and lost productivity related to severe burnout cases worldwide). While that number hits the healthcare systems, employers bear the productivity loss side of that coin. Within any given company, teams suffering high burnout will show up in the metrics: lower output per head, more sick days taken, and higher quit rates. Essentially, burnout is where the human toll and the financial toll of poor well-being intersect most acutely.
Recognizing burnout signs early – and intervening – is critical. HR should track indicators like excessive overtime, sustained high workload, and employee self-reports of being unable to “switch off” (over a quarter of employees say they can’t relax outside work (Spill Chat, 2025) , a red flag for burnout). Managers need to be trained to promote realistic workloads and respect time off. From a leadership perspective, preventing burnout is not just about being kind to employees; it’s about protecting the organization’s productive capacity. CFOs can appreciate that a burned-out workforce is an underperforming (and eventually shrinking) workforce.
Reduced Productivity and Lost Potential
All of the above factors feed into what might be the most damaging impact of unwell teams: reduced day-to-day productivity and lost potential performance. Even before an absence or a resignation happens, poor mental health is quietly sapping the effectiveness of employees at work. This can show up as declines in output, lower quality work, missed innovation, and weaker customer service – all of which have financial consequences.
Research quantifies these productivity losses. The American Psychiatric Association reports that employees suffering from unresolved depression experience a ~35% drop in productivity on average (Plansponsor, 2025). They estimate this translates to a $210.5 billion annual cost to U.S. employers when you combine lost productivity with absenteeism and medical expenses related to depression (Plansponsor, 2025). And that’s just one condition – add anxiety, chronic stress, and other mental health issues, and the productivity impact spans all roles and departments.
Gallup’s workplace analytics make clear how pervasive the engagement and productivity gap is. Gallup’s 2023/24 data show that only about 21% of employees worldwide are engaged at work, with the rest ranging from not engaged to actively disengaged. They found that currently 62% of employees are disengaged – a main driver being stress and lack of well-being – which leads to a global productivity loss of $8.8 trillion annually (Plansponsor, 2025). To put that in perspective, that’s nearly 9% of global GDP disappearing due to subpar performance at work. On a company level, Gallup calculates that disengaged employees cost an organization about 18% of their salary in lost productivity (Plansponsor, 2025). So an employee earning $60,000 but who is disengaged (likely due in part to feeling unsupported or burnt out) is effectively costing the firm around $11,000 in value each year. This is a silent bleed on performance metrics and financial results.
🎯For HR leaders: improving these numbers means creating a work environment where people can be fully present, focused, and motivated – which is nearly impossible if mental health needs are ignored. For CFOs, the math is simple: higher engagement and better well-being equal higher productivity. It’s no surprise that organizations known for great well-being programs often report better business outcomes. As an example, companies that prioritize mental health as part of their strategy see on average 13% higher productivity than those that don’t (Plansponsor, 2025), along with significantly lower rates of stress and absenteeism. In other words, supporting your people is a direct investment in more output per employee.
Investing in Wellbeing: High ROI, High Impact
The silver lining in all this is that improving employee well-being works. The problem may be costly, but the solutions can deliver real financial returns. We now have credible data from large-scale studies showing that efforts to support mental health are not just altruism – they’re good business strategy.
Multiple sources, including professional services firms and global health organizations, have calculated the return on investment (ROI) of workplace mental health programs. Deloitte’s 2024 analysis in the UK found that, on average, employers get about £4.70 back for every £1 invested in supporting staff mental health (Deloitte, 2024). That is a 470% ROI, driven by reductions in absenteeism, presenteeism, and staff turnover when effective support and prevention programs are in place. This is in line with other studies (e.g., the UK Mental Health Foundation cites roughly a 5:1 ROI on mental health interventions (Mental Health Foundation, 2024) , and the World Health Organization globally has noted around a 4:1 return). For CFOs, few investments yield that kind of multiple – it’s a compelling business case to allocate budget to well-being initiatives.
What do these interventions look like in practice? They range from employee assistance programs (EAPs) and counseling services, to training managers in mental health awareness, to instituting more flexible work options and reasonable workloads. A focus on building a supportive workplace culture is crucial – workplaces that proactively address mental health see tangible benefits, such as those 13% productivity gains and markedly lower stress levels among employees (Plansponsor, 2025). Prevention is better (and cheaper) than cure: encouraging work-life balance, normalizing discussions about mental health, and providing resources early can prevent issues like burnout from snowballing into absences or resignations.
It’s encouraging to see that awareness is growing. In a recent PwC survey, three in five employers acknowledged that employee health and well-being has a direct impact on business performance (PWC, 2023). This alignment between HR and the C-suite is key – when both HR leaders and CFOs understand the stakes, companies are more likely to invest in meaningful solutions. Some organizations are even appointing Chief Wellness Officers or dedicating budgets to mental health as they would for R&D or marketing. The message is clear: a healthy workforce drives a healthy business.
For companies looking to take action, partnering with experienced providers can accelerate the journey. This is where SideUp comes in as a practical, solution-driven partner in employee support. SideUp (our organization) specializes in helping employers implement effective well-being programs and benefits with a focus on measurable results. By leveraging such partnerships, HR leaders can get the right tools and services in place quickly – whether it’s an on-demand counseling platform, stress management workshops, or data analytics to identify teams at risk. The goal is to catch issues early and provide support before the costs escalate. With the right support system, an employee who might have become disengaged or burned out can instead get help, stay productive, and remain with the company – turning a potential cost back into value.
Key Takeaways for HR Leaders and CFOs
- Poor employee mental health carries a massive price tag. The cost of unwell teams shows up in hard metrics – for example, about £51 billion per year in the UK (Deloitte, 2024) and tens of billions in the US due to lost productivity (Gallup, 2022). Ignoring mental well-being is simply too expensive.
- Absenteeism and presenteeism are two sides of the same coin. Mental health issues drive up absenteeism (e.g., 28% of UK sick days are due to mental health (Spill Chat, 2025), but even more costly is the lost productivity when employees work unwell. Presenteeism costs are often several times higher than absentee costs (around £24–28 billion annually in the UK alone) (Deloitte, 2024) (Spill Chat, 2025).
- Turnover and talent loss are directly tied to well-being. More than half of employees (61% in one UK survey) who quit cite poor mental health as a factor (Spill Chat, 2025) . Replacing staff is expensive (10–30% of salary per hire) (Plansponsor, 2025), and high churn damages morale further. Investing in mental health support helps retain your talent and avoids the high cost of attrition.
- Burnout is a critical warning sign. With well over 60% of employees experiencing burnout symptoms (Deloitte, 2024), companies must take action to prevent this “slow hemorrhage” of productivity. Burnout leads to more sick leave, mistakes, and resignations. Addressing workload, recovery time, and support is not just kind – it protects your workforce performance.
- Supporting well-being delivers ROI and performance gains. When companies prioritize mental health, they see improvements in engagement and output (e.g., 13% higher productivity in pro-wellbeing workplaces (Plansponsor, 2025)). There’s a strong business case: approximately 4-5 times return on every dollar or pound invested in employee mental health programs (Deloitte, 2024). In short, doing right by your people also means better financial results.
- Partnering on practical solutions makes a difference. You don’t have to tackle this challenge alone. Leveraging experts and services (like SideUp’s employee support platform) can help implement effective well-being initiatives quickly. Practical, data-driven support programs can reduce absenteeism, keep employees engaged, and ultimately save more money than they cost – turning employee well-being from a risk into a strategic advantage.
Conclusion
The numbers don’t lie – unwell teams exact a real cost on organizations, in both financial and operational terms. HR leaders and CFOs who jointly address this challenge will not only see healthier, happier employees but also a healthier bottom line. The conversation has moved beyond awareness; it’s now about action and investment. By treating mental health and well-being as core business priorities, companies can recoup lost productivity, retain their best people, and build a more resilient organization. In today’s competitive landscape, supporting your employees isn’t just about avoiding costs – it’s about enabling potential. As a solution-focused partner in this space, SideUp stands ready to help organizations turn these insights into impactful outcomes, ensuring that caring for your team and strengthening your business go hand in hand.