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The Cost of Trauma

Updated: Apr 13, 2023

The Cost of Trauma

The prevalence and effects of trauma are well documented in the literature. According to Kessler et al. (2017), up to 70.4% of people worldwide have been affected by trauma. Additionally, approximately 30.5% of people have been exposed to four or more traumas (Breslau, Davis, Andreski, & Peterson, 1991). Moreover, those who experience trauma are at a higher risk of developing other mental disorders such as depression, anxiety disorders, adjustment disorders, reactive attachment disorders, disinhibited social anxiety disorder, acute stress disorder, eating disorders, obsessive-compulsive disorder, post-traumatic stress disorder, borderline personality disorder, substance abuse problems, among others (Briere & Scott, 2015; Kessler et al., 2017; Nemeroff et al., 2006).

While some people associate trauma with events such as sexual assault, a car crash, or witnessing a death, trauma can also result from any negative experience that has created emotional distress and still exerts control over one's life or shapes one's personality in a negative way, such as a breakup, getting bullied, or negative interactions with parents or caregivers (van der Kolk, 2014). Unfortunately, not all trauma gets reported as some individuals may not realize that they have experienced trauma or may feel reluctant to report it due to the negative emotions it may evoke, including guilt, shame, anxiety, or fear. Additionally, mental health services may have a negative stigma attached to them, which can prevent people from seeking help (Greenberg et al., 1999).

Trauma can lead to a range of personal and mental health problems, including but not limited to nightmares, problems sleeping, lack of energy, trouble focusing, flashbacks, difficulties forming personal or romantic relationships, constantly being on alert, having thoughts of hurting oneself, as well as negative emotions such as guilt, anger, shame, anxiety, or sadness (van der Kolk, 2014). Negative core beliefs can develop following traumatic experiences and can impact one's relationships, productivity, and overall well-being (Resick et al., 2002).

Mental health issues such as depression, anxiety, and trauma can have a significant impact on the well-being of employees and the productivity of businesses and workplaces. The cost of mental health trauma to businesses and places of work each year is staggering, with some estimates placing it at billions of dollars. This paper will explore the impact of mental health trauma on businesses and workplaces, as well as some strategies that employers can use to address these issues.

The Impact of Mental Health Trauma on Businesses and Workplaces

Mental health issues can have a profound impact on the well-being of employees, affecting their ability to work, interact with others, and participate in everyday activities. In addition to the personal impact on employees, mental health trauma can also have a significant financial impact on businesses and places of work.

According to a report by the World Health Organization (WHO), depression and anxiety disorders cost the global economy an estimated US$ 1 trillion each year in lost productivity. In the United States alone, the cost of depression and anxiety to the economy is estimated at $1 trillion per year in lost productivity and healthcare costs (Mental Health America). In the UK, the total cost of poor mental health to employers is estimated to be between £33 billion and £42 billion each year (Mental Health Foundation). In Canada, it is estimated that mental health problems and illnesses cost employers approximately $20 billion per year in lost productivity (Mental Health Commission of Canada).

Some of the key ways in which mental health trauma can impact businesses include:

1. Lost productivity: Mental health issues can significantly impact an employee's ability to work, resulting in increased absenteeism, presenteeism, and decreased productivity. According to the WHO, more than 300 million people suffer from depression, the leading cause of disability worldwide, and around 60% of those with depression are not receiving treatment.

Increased healthcare costs: Employees with mental health issues may require more healthcare services, which can result in higher healthcare costs for businesses and employers. According to the National Alliance on Mental Illness (NAMI), the annual cost of untreated mental illness in the United States is more than $100 billion. Furthermore, a study published in the Journal of Occupational and Environmental Medicine found that employees with depression missed an average of 4.8 more workdays per year than those without depression, resulting in an estimated loss of $44 billion per year in the United States.

2. Increased staff turnover: Mental health issues can also contribute to increased staff turnover, which can be costly for businesses and workplaces. According to a study by the American Psychiatric Association, employees with untreated mental health issues are more likely to leave their jobs.

3. Reduced morale and engagement: Mental health issues can also impact the morale and engagement of employees, resulting in a less productive and cohesive workplace. According to a study by the American Psychological Association, more than 60% of workers who experience mental health issues report that it affects their productivity.

4. In addition to decreased productivity, mental health problems can also result in increased healthcare costs. Individuals with mental health conditions may require more frequent visits to healthcare professionals and may need to take prescription medications, which can be expensive. A study by the National Alliance on Mental Illness (NAMI) found that individuals with mental health conditions spent an average of $1,425 per year on out-of-pocket healthcare costs, which is higher than the average for individuals without mental health conditions.

5. Furthermore, mental health problems can have a negative impact on an individual's quality of life, which can lead to additional costs. For example, individuals with mental health conditions may be more likely to engage in unhealthy behaviors, such as smoking or substance abuse, which can lead to additional healthcare costs. Additionally, mental health conditions can lead to social isolation, which can have a negative impact on an individual's overall health and well-being.

Overall, mental health problems such as trauma, depression, and anxiety can result in significant financial losses. These losses are due to decreased productivity, increased healthcare costs, and lower quality of life. It is important to address mental health problems to not only improve an individual's overall well-being but also to reduce the financial burden associated with these conditions. This can include seeking professional treatment, practicing self-care, and addressing workplace and societal issues that may contribute to mental health problems.

Strategies for Addressing Mental Health Trauma in the Workplace

Fortunately, there are several strategies that employers can use to address mental health trauma in the workplace and support their employees. Some of these strategies include:

Educating employees:

Employers can provide education and training to employees on mental health issues, including how to recognize the signs and symptoms of mental health trauma, and how to access support and resources. According to the Centers for Disease Control and Prevention (CDC), mental health education can help reduce stigma, increase awareness, and promote early intervention and treatment.

Creating a supportive workplace culture:

Employers can foster a supportive workplace culture that prioritizes the well-being of employees and provides support and resources to help employees manage mental health issues. According to a study by the Society for Human Resource Management, employees who work in a supportive workplace culture are more engaged and less likely to leave their jobs.

Providing mental health support:

Individuals who experience trauma may benefit from working with a trained professional who specializes in trauma. One such approach is Eye Movement Desensitization and Reprocessing (EMDR) therapy, which has been found to be effective in treating traumatic memories and negative core beliefs (Shapiro, 2018). EMDR intensives, which involves longer sessions lasting several hours over multiple days, can be particularly effective in helping individuals work through their trauma and negative core beliefs (Hase, Schallmayer, & Sack, 2008; Leeds, Korn, & Storfer-Isser, 2013). It is important to note that progress in therapy can vary from person to person, and each individual should seek the approach that works best for them.

Promoting good mental health can lead to improved employee engagement, higher job satisfaction, and better overall performance. A study by Gallup found that engaged employees are 21% more productive than their disengaged counterparts. The paper also highlights that promoting good mental health can reduce absenteeism and presenteeism, resulting in increased productivity and profitability for companies. A study by the American Psychological Association found that companies that support employee well-being experience a 41% reduction in absenteeism.

Furthermore, promoting good mental health can also result in reduced healthcare costs for companies. Mental health issues are a leading cause of disability worldwide, and they can result in significant healthcare costs for both individuals and companies. The paper cites a study by the Centers for Disease Control and Prevention, which found that depression and anxiety are associated with increased healthcare costs of up to 50%.

In conclusion, trauma is a prevalent issue that can have a range of adverse effects on individuals' lives as well as the company that they work for. Good mental health is essential for individuals, and promoting it has significant benefits for companies. Companies that prioritize mental health are more likely to attract and retain top talent and can ultimately achieve greater profitability. Promoting good mental health can reduce the negative impact of mental health issues on productivity, engagement, absenteeism, presenteeism, and healthcare costs. It is in the company's best interest to help increase mental health by doing the things listed in this article. Encouraging counseling or possibly paying for services is advantageous financially for a company in the long term. Seeking professional help from a trained specialist who specializes in trauma can be a helpful approach to working through traumatic experiences and negative core beliefs. EMDR therapy, particularly intensive EMDR, has been found to be effective in addressing trauma and negative core beliefs and can offer individuals an opportunity to achieve lasting relief from the impact of trauma on their lives.


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  8. Nemeroff, C. B., Bremner, J. D., Foa, E. B., Mayberg, H. S., North, C. S., Stein, M. B., ... & Wulsin, L. (2006). Posttraumatic stress disorder: a state-of-the-science review. Journal of psychiatric research, 40(1), 1-21.

  9. Resick, P. A., Monson, C. M., & Chard, K. M. (2002). Cognitive processing therapy: Veteran/military version (CPT-M). US Department of Veterans Affairs.

  10. van der Kolk, B. A. (2014). The body keeps the score: Brain, mind, and body in the healing of trauma. Penguin Books.

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