Workers' Compensation

Employers’ Costs of Lost Productivity Due to Obesity-Related Absenteeism: 50 State Study

Roger Rabb, J.D., Special Correspondent for the LexisNexis Workers’ Compensation eNewsletter

Although the annual costs of providing healthcare to Americans for conditions associated with obesity has been estimated at well over $100 billion ($147 billion in 2008), less information has been gathered about the cost to employers of lost work days attributable to overweight and obese employees. In order to provide more working data about the true economic costs of obesity in America, a new study, “State-Level Estimates of Obesity-Attributable Costs of Absenteeism,” has been published in the November 2014 issue of the Journal of Occupational and Environmental Medicine. As noted in this study, the importance of this issue for the American economy in a global marketplace is evident, as “[r]educed productivity of public and private employees could lead to higher production costs and a less competitive workplace.”

Using information from the National Health and Nutrition Examination Survey compiled between 1999 and 2008, as well as data from the Behavioral Risk Factor Surveillance System compiled in 2012, the authors of this study separated employees (age 18 or over, and excluding certain underweight employees and pregnant women) into five weight categories—normal, overweight, and three levels of obesity. They did not find a statistically significant difference between the absenteeism of normal weight employees and those employees in the overweight category, nor did they find any significant differences when factoring in the gender of the employee. However, they were able to identify appreciable differences in absenteeism between normal weight employees and those in the obese categories.

The study estimated the absenteeism costs attributable to obesity for each state and the District of Colombia by multiplying the average daily earnings in each state by the difference in missed workdays between normal weight employees and those in the obese categories. For these purposes, they estimated that normal weight employees miss a bit more than 4 days a year of work because of health issues, while employees in the three obesity categories had expected workday losses for health reasons that ranged from about 1.1 days to 1.9 days more than their normal weight counterparts.

Key Findings

> The average costs of absenteeism per obese employee in the U.S. was $260 per year, which for the individual states ranged from a low of $209 per year in South Dakota to a high of $345 per year for the District of Columbia. The large variation between states was largely attributable to the significant differences in the average daily earnings between the different states.

> The 10 states with the highest estimated costs of absenteeism attributable to obesity were:

1. District of Columbia: $345 per obese employee

2. New Jersey: $321 per obese employee

3. Connecticut: $317 per obese employee

4. Maryland: $304 per obese employee

5. Massachusetts: $300 per obese employee

6. Virginia: $298 per obese employee

7. New York: $295 per obese employee

8. New Hampshire: $288 per obese employee

9. Delaware: $286 per obese employee

10. Washington: $284 per obese employee

[Note: A complete 50 state chart is included in the study.]

> After factoring in the number of obese employees, the study estimated that the total cost per year from employee absenteeism in the U.S. was $8.65 billion per year, which for individual states went from a low of $14.4 million in Wyoming to a high of $907 million in California.

> Compared to the amount of overall absenteeism costs, the absenteeism cost attributable to obesity was 9.3% in the U.S., with percentages among the individual states ranging from a low of 6.5% in the District of Colombia to a high of 12.6% in Arkansas. The study also noted that the 9.3% national average was very similar to the 9.1% national average (in 2006) for obesity-related health care spending that was estimated in an earlier study.

> Productivity losses due to obesity were the highest in states with relatively low rates of obesity (compared to the national average), because those states generally had the highest average daily wages.

Limitations of Study

Presenteeism

The authors of the study cautioned that their estimates concerning productivity losses did not take into account “presenteeism,” which is when the employee is present at work but is not being productive. Although the authors lacked the data at the state level to accurately measure the costs of presenteeism, they noted that numerous earlier studies had found evidence that presenteeism attributable to obesity carries large costs as well, “on par with obesity-related health care costs and [exceeding] obesity-attributable costs of absenteeism.”

Obesity and the job hunter

The authors also cautioned that the study only looked at the currently employed population aged 18 or older and did not look at the effects of obesity on efforts to obtain employment. For purposes of the study, they assumed that the “relationship between the probability of employment and obesity was the same across all states,” although they recognized that “[c]hanges in employment rates across states are driven by a large number of complex issues related to local job market characteristics, policies, and regulations, as well as the larger economy.”

Self-reported data

In addition, the authors recognized the inherent limitations of relying on self-reported data, especially when the questions asked of employees required them to report on their activities over a span of the previous 12 months. Moreover, some categories of employees were not included in the surveys, including military personnel, who are generally not part of household surveys; persons who were working, but not at the time of the survey; persons who took sick leave or short-term disability due to obesity; and persons, such as students or homemakers, who contribute to the economy but are not “employed.” They also noted that using state average daily earnings may have resulted in a higher-than-actual estimate of productivity costs, given evidence that obesity tends to be associated with low socioeconomic status.

What This Means for Employers

In spite of the limitations on the data presented, the authors noted that “providing estimates on the magnitude of how obesity may impact economic productivity has significant policy implications,” and that the economic value of “investing in a healthier workforce” goes beyond merely trying to reduce the healthcare costs attributed to obesity. They noted that employers will often seek out communities with “skilled and healthy workers,” and therefore “maintaining a healthy weight and an active lifestyle, along with other indicators of a healthy community, can . . . be an indicator for a competitive workforce.”

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