Work-related fatality and injury rates are declining nationally, indicating we are on the right track with prevention and incident management. However, there were 4,693 fatal work-related injuries and nearly 3 million non-fatal workplace injury and illnesses reported by private industry in 2011, according to the most current data available from the U.S. Bureau of Labor Statistics.
The human toll associated with preventable workplace injuries, illnesses and deaths is incalculable. However, from a monetary perspective, a UC Davis researcher has estimated the annual national price tag of work-related injuries and illnesses at $250 billion, much higher than generally assumed. In the 2013 edition of Injury Facts, the National Safety Council reports the annual cost of injuries in the workplace is $188.9 billion, including wage and productivity losses, medical costs, administrative expenses, uninsured costs, and vehicle and fire damages.
Safety incorporates health considerations, as well. For example, when an employee is absent after being exposed to a contagious disease at work, studies show that single case generates an average of $22,000 in direct costs and $24,600 in indirect costs. Given a 7 percent profit margin, it would take approximately $671,000 in revenue to cover the total costs of that one contagious disease.
So, what does this mean?
In short, after celebrating declining incident rates, companies need to renew their emphasis on reducing work-related injury and illness rates. Companies that have not made a substantial investment in injury and accident prevention or made a commitment to instilling a culture of safety in the workplace are placing cost burdens on themselves and all of the rest of us. Studies show that companies with poor safety records experience decreased profit margins and numerous challenges associated with low employee morale.
Safety requires an initial investment, but the ROI will far exceed the cost in the long run. If a single training program reduces a company’s accident rate by a modest 10%, for instance, it would yield a total savings of $250,000. If the training program cost $ 70,000 to implement, the ROI would be 257%.
By putting safety and health first and striving to reduce injuries and illnesses, the overall burden of occupational injuries and illnesses will diminish.