Smoking costing Australian businesses millions per year

Staff Writers

Employees who smoke are costing Australian companies millions per year, as smoke breaks and absenteeism are contributing to decreased worker productivity and increased health risks.

Speaking at the Australian Health and Productivity Management Congress in Sydney on Monday 12th August, Tim Nelson and Dr. John Lang from Alere delved into the economic impact of smoking in the workplace, and how it is costing Australian businesses.

Dr. Lang described the human cost of smokers in the workplace, saying “in terms of sick days, smokers are statistically going to have 50% more absenteeism than non-smokers”. In addition, about a quarter of smokers that don’t quit will die before they retire. This is the reason that HR managers must introduce their own cessation programs, as part of a wider health and wellbeing program to increase overall productivity and improve employee’s health.

There is the viewpoint that allowing employees to smoke will help to manage stress and anxiety. This myth was dispelled by Lang who said that “people who quit smoking… will have better depression, anxiety and stress scores”. In addition, “if 8 or more hours per year are lost due to smoking, then all smoking cessation programs will be cost saving for an employer… it is a no brainer in terms of having a positive economic impact for your organisation.”

It is often difficult for companies to evaluate how healthy their workforce is, and identify the key health and risk factors. Often a company will run assessments with a 20 to 30 percent sample size, however the outcomes of these studies are often inaccurate as the unfit or unhealthy workers are the last to get on board with health and fitness studies.

The Alere Wellness Index, powered by Roy Morgan research, has accumulated data on 350 000 Australians over the last 5 years, measuring their health and behaviours. Overall 129 factors contributed to the index including exercise activity, psychological wellbeing, nutritional health, alcohol and smoking.

This database can then focus on a particular city or town, demographics, backgrounds and even voting intentions to analyse the reason behind unhealthy behaviours, and strategies to prevent them.

The practical uses of the Alere Wellness Index were demonstrated at AHPM by Tim Nelson, who used smoking statistics to calculate the financial cost for an organisation. To demonstrate, the transport and industry sector was used as an example. A company with 878 employees and an absenteeism rate of 4.2 days per year. Assuming 3 smoke breaks per day totaling 30 minutes, and a working year of 240 days, the cost of lost hours/ days per annum totaled to 1.174 million for the company. This method of calculation for financial impact on companies with smokers can also be adapted to evaluate the impact of other health risks.

As an avoidable cost, this significant economic impact on organisations can be lessened with the introduction of a smoking cessation program.

The AHPM Congress continues with a one day workshop on Tuesday 13th August, and another full day Congress program in Melbourne on 14th August.

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3 thoughts on “Smoking costing Australian businesses millions per year

  1. Damn lies and statistics. I have two smoke breaks of 5 minutes each per day, this is the 10 minute break I’m allowed under the award but I normally return early from lunch most often around 15 minutes so this more than compensates for my smoke breaks. As for sick days, I have less than the majority of my non-smoking work mates in the same section.
    Believe you could put coffee drinkers through the same process and come up with very similar figures. As for drinkers and late lunch staff, they would be an even higher cost. You can make figures say anything.

  2. I am very annoyed at the claim that that all employees who smoke are inefficient. When I am outside smoking, I get a chance to think over what my task list is, how to approach problems, what to do next, and other such issues that cannot be addressed when at the desk. For me, a “smoke break” is a sanity and planning break.
    It makes me more efficient.

  3. There is no doubt that there are good and decent workers who are also smokers, remember that statistics do not cover all.

    In my workplace of about 20 staff there are about 8 smokers. 6 of them take many more sick days than the rest of the staff, 4 of them seem to have a myriad of breaks over the day and 1 of them even died at 60 from lung cancer…

    I am not a smoker, and I ask when does it become assault for a smoker to walk past my child with a lit cigarette

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