Employee Burnout: It’s real. It’s getting worse. And it’s costing employers big time

Acting now can help you retain the best people and grow the business

October 26, 2021

Employee burnout was already a growing concern long before the pandemic struck. In fact, a Deloitte study pre-COVID 19 showed that 42% of U.S. employees left their job specifically because of burnout. But the lockdowns and uncertainty caused by COVID-19 have exacerbated the problem. Employee burnout is now widespread, prevalent in almost every organization across the country.

An Indeed employee survey found that 31% of Baby Boomers report burnout along with 54% of Gen X and 53% of Gen Y. And the problem appears to be increasing at a frightening pace.

According to a 2021 MetLife Benefit Trends Study, burnout has increased 25% since April 2020. During that time, 26% of U.S. employees have asked for help for stress, burnout or other mental health challenges. And a report from Mental Health America, “Mind the Workplace,” found 83% of respondents agreeing with the statement, “I feel emotionally drained from my work.”

The C-suite is also susceptible. In 2019, the World Health Organization (WHO) discovered that more than 60% of board-level executives reported feelings of high anxiety and stress on a regular basis.

What is burnout costing employers?

The Harvard Business Review (HBR) reports that burnout adds between $125 billion and $190 billion every year in health care costs and stress alone accounts for 8% of national health care spend.

Gallup calculates that burned-out employees cost $3,400 out of every $10,000 in salary because of disengagement. HBR also found that the deeper cost to business can be low productivity, high turnover and the loss of the most capable talent and the cost to replace them.

But what exactly is it?

Experiencing “burnout” doesn’t mean someone has simply had a lousy day. It is an occupational phenomenon resulting in extreme physical and emotional exhaustion. Employees have little or no energy. Their attitude towards work has turned negative and cynical; they’re impatient and unmotivated, dissatisfied and disillusioned; and they may begin to resent or hate their co-workers and the work itself.

Burnout results in seriously reduced professional capability and efficiency. Employees are no longer focused and their productivity may fall off precipitously.

What causes burnout?

Many company executives assume that burnout is an individual problem or a talent management issue. But it’s more likely caused by the environment those same executives or supervisors created that produces the frustration and stress that leads to burnout. Employees uniformly report the following as causes for their burnout:

  • Being unable to influence decisions that will affect their job
  • Unclear job expectations ­
  • Disorganized work routines
  • Unsupportive culture
  • Management that lacks empathy
  • Job insecurity
  • Too much work, too little work or going back and forth between the extremes
  • Feeling isolated (too many Zoom meetings, too little connection to others)
  • Lack of work/life balance

In analyzing the causes of burnout, companies need to face the issue head-on, assume their responsibility for it and then use organizational measures to deal with it.

Why is the problem hitting so hard right now?

The pandemic is without question a key to the surge in employee burnout. It has caused serious uncertainty, isolation and even driven employees from the workforce. But it has also allowed employees to view their job and work environment more clearly. And many of them don’t like what they see.

Employees, particularly Gen Y and Z, are insisting that employers provide them with what they need, far beyond typical benefits. They want true work/life balance, not just talk. All workplace generations are realizing that their careers are only part of their lives, not the center of the universe. They want recognition and appreciation for their contributions as well as more flexibility and freedom.

If an employer can’t provide that, a lot of employees are perfectly willing to leave and find what they need elsewhere.

Burnout can affect mental health

Many people ­– employees as well as management – simply aren’t accustomed to talking openly about mental health. But employee burnout can lead to mental health issues…and these are issues employers need to recognize and address.

Talking about burnout with an employee can lead to discussions about the challenges they face. This is when employers need to listen carefully and then find ways to connect their employees to the right resources — from in-person therapy to telehealth to mindfulness apps. The key is to make sure the employee is heard and then helped.

There is no magic pill to mitigate burnout

Ignoring the problem and hoping it will go away is a losing strategy. The solution to dealing with burnout starts by rethinking how you do business and the expectations that are placed on employees. This is about respecting the collective and unique individual talents of employees as well as their limitations.

Pushing people past their limits never has been a great business strategy. Granted, employees may often demonstrate the ability to go beyond what is expected — but pushing them there over and over again is not healthy. The burnout statistics are stark reminders of the failure of that management method. So, what can you do?

  1. Start by making sure you promote a positive, caring culture and working environment
  2. Actively listen to your employees
  3. Create a transparent approach to communicating with employees
  4. Fix inequities by acting on what you hear
  5. Promote positive connections between employees
  6. Be flexible
  7. Make sure workloads are manageable
  8. Give employees more control over their jobs and help them find value in the work
  9. Reward and acknowledge good work
  10. Treat everyone fairly and equitably

Marsh & McLennan is here to help

We can work with you to re-examine your culture so you can develop an environment that is empathetic to employees while still being productive. We can also help you design a plan for successfully talking with employees about mental health.

MMA has also created a Mental Health Tool Kit to help you and your employees manage the problems that often cause burnout. We’ve addressed anxiety, depression, resiliency, managing stress, substance abuse, where to go for care and more.

To learn more, talk with your Marsh & McLennan Agency representative.