Psychosocial risks have emerged as a major factor for employers when managing workplace wellbeing, according to findings from global consulting firm Gallagher.

The firm released its 2023 ‘Australian Workforce Trends Report’, which incorporates the Workplace Wellbeing Index and is based on insights from more than 2,600 full-time, part-time, and casual employees across Australia.

The research demonstrated a deterioration in workplace well-being from 2022 and highlighted the need for employers to focus more on career, connection, and psychosocial factors to improve the long-term employee experience.

Now in its second year, the Workplace Well-being Index acts as a barometer for how Australian workplaces are tracking in providing positive, safe, and effective workplaces for employees.

The 2023 Index reveals slightly less than half (48 per cent) of all employees report high well-being. This figure shows a deterioration in well-being on 2022 figures, where slightly more than half (52 per cent) of all employees reported high well-being.

Younger employees display significantly lower levels of well-being than older employees (5 per cent lower).

Taking a time out

There is an increasing trend where employees continue to work even when they feel they should take time off due to their well-being.

The research found that almost half of all employees (46 per cent) continued to work when they felt they needed time off – significantly more than the previous 12 months, where around a third (31 per cent) of employees reported this.

Such findings reveal an increased risk for organisations is being unaddressed, both in relation to increasing leave, loss of productivity, and the likelihood of work-related injury claims, particularly with poor mental health conditions at work increasing as a proportion of serious claims.

Psychological health risks have increased, rising from 6.2 per cent of all serious claims in 2014-2015 to 9.3 per cent in 2020-2021, and are one of the costliest forms of claims, posing a median cost of $55,270 per claim, compared to $13,883 for physical injuries and diseases.

When candidates consider joining a new organisation, the research found that rewards and benefits are a crucial factor (22 per cent) in their decision-making, with meaningful work (16 per cent) and a focus on safety, health, and well-being (15 per cent) also ranking highly.

In contrast, employees who have been working at their current organisation for two to three years place equal importance on remuneration, reward, and benefits (19 per cent), and career growth (17 per cent), with an equal focus on safety, health and well-being (17 per cent).

For younger employees (18-24 years), the focus on safety, health and well-being is much higher (20 per cent). It ranks above career growth (17 per cent), meaningful work (14 per cent) and remuneration (13 per cent).