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Cost savings is determined by the metrics that are picked as part of the Corporate Wellness Analysis Program. Programs may differ from cost savings. I will guarantee cost savings that will triple the cost of the program or you will owe me nothing.

Standardized Metric

  • Decrease Turnover Rate

Turnover rate can be 1.5-2 times the cost of the employees current salary (builtin.com). The cost of turnover is dependent on a couple of influential factors that can either raise or lower the cost of rehire and retrain.

In the lowest degree the cost of turnover is equal to the hours of training per day x amount of days of training x cost of rehiring process.

Using this simple math we can use the following example: A employee makes an average of 10 dollars an hour. It takes 6 weeks to train the employee. To utilize the 3rd party hiring system is cost 375$. In the situation we take 10$ x 40 (hours a week) x 5 days a week x 6 weeks + 375$= 12.375$. This is the cost for only one employee turnover. The average turnover rate is about 12%-15%, according to the Bureau of Labor and Statistics. To find this percentage you can apply the concept (employees left/employees at the beginning of the year + employees at the end of the year x 100)

If we anticipate a 100 person company and say turnover is 12% of that with the average standard pay of 10$ an hour with an average training of 6 weeks + 375$ for third party job search we now have a cost of $148,500 at a minimum. Now introduce a targeted wellness event to combat this statistic and lower turnover rate from 12% to 10%. Running the same equation: 10 employees x $12,375 the cost is now $127,500. A difference of $21,000.
  • Decreased Sick Time

A recent survey published by Statistica showed on average of 5 days a year sick time taken for ages 18 t0 30. If we use 5 days as an average we can now calculate the cost of a company with 100 employees. The cost of sick time= cost of replacement. We do not need to factor in cost of paying someone to stay home as this was already factored into the cost of production. If we utilize the same employee as previously with a rate of 10$ an hour, the calculation would be cost of sick time= 10$ x 8 or 80$. If we say that 10% of the employees in a 100 person company will utilize 5 days, we can now establish a calculation. 80$ x (100 x 10%) x 5 = $4,000 dollars. This does not factor in the cost of insurance rising, lost of productivity, and a few other factors that would be difficult to quantify.

  • Decreased Injuries Linked to Fatigue

This is one of the hardest metric to track and therefore one of the best kept secrets of my Corporate Wellness Analysis Program. Injuries can be captured and placed in two different categories: employee error and equipment error. Employee error can be caused by a multitude of factors and only a trained professional can start to categorize each individual injury, establish a trend, and present the findings.

Some quick statistics:
-According to a systematic review conducted by Sleep Medicine Review and published on pubmed, you are 1.62 more likely to have an injury when you are tired.
-According to that same review, approximately 13% of work related injuries are attributed to sleep.
Now we are really getting into statistics! I picked the lowest grade of injuries I could find on the OSHA Safety Pays calculator, contusion. An average contusion cost $27,673 between the cost of treatment and productivity. Take your injury numbers, multiply by .13 (for 13 percent) and multiply that by $27,673. This will be your potential lowest amount it cost the company for work related injuries attributed to lack of sleep.

But Dr. Dan..there are more wellness problems than lack of sleep. Yes I know and all this and more is factored into Corporate Wellness Analysis Program.

 

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