Sickness costs rise despite 14-year low in absence rates

Absence levels may have fallen but the annual cost to employers has risen by
more than £1b, says a new study

Workplace absence has fallen to its lowest level for at least 14 years, yet the
annual cost to employers has risen by more than £1bn, a report by the
Confederation of British Industry and healthcare provider PPP has concluded.

The annual study, called Counting the Costs, found the number of working
days lost to workplace absence last year fell by 16 million to 176 million,
compared with 192 million in 2000. This equated to 7.1 days per employee, or
3.1 per cent of total working time, the lowest figures recorded since the
survey began in 1987, the report said.

The figures come as official Government statistics show that sickness
absence is concentrated in certain groups of employees (see below).

According to the CBI/PPP healthcare report, the average cost of absence per
employee rose to its highest level for five years. Projected across the whole
workforce, the total cost of absence to British business rose to £11.8bn in
2001, against £10.7bn in 2000.

Since 1991, average absence has fallen by two days. Average absence levels
in 2001 were 25 per cent lower than those recorded 10 years ago.

In the public sector an average of 10.1 days were lost, compared with 6.7 in
the private sector.

Until 1998, the difference between the two sectors had been narrowing, and
in that year was at 2.5 days. But the past three years has seen it widen again.Absence
rates among non-manual employees fell for the fourth year in a row. In 2001 the
average was 5.5 days per employee, compared with 6.3 in 2000.

Rates for manual workers continued to be higher, at 8.8 days per employee in
2001 compared with 9.5 in 2000.

Organisations employing fewer than 50 people lost an average of 4.5 days per
employee, 1.4 days less than the previous year.

Firms employing more than 5,000 people averaged 9.6 days, slightly up on

Crucially, absence rates were lowest in organisations where senior managers
took responsibility for managing absence, said the study.

Those organisations lost, on average, five days per employee per year,
compared with 7.6 where it was left to line managers.

Return-to-work interviews were the most effective absence management tool,
followed by disciplinary measures.

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