The Cost of Employee Stress and How to Master it

The Cost of Employee Stress and How to Master it
November 22, 2016 Niels van Hove

According to the Australian Industry Group (AIG) the cost of absenteeism to the Australian economy is $24 billion each year, with the cost of presenteeism – productivity losses as a result of workers attending when unwell – estimated to be even greater at almost $35 billion. Presenteeism represents therefor a 50% additional hidden cost to Australian business.  In their 2014 ‘Absenteeism & Presenteeism Survey Report’, AIG estimates that absenteeism costs organisations around $536 per employee for each day they’re off work.

Work related stress is the second most compensated illness/injury in Australia. Government insurer Comcare revealed that mental stress payout accounted for a third of its overall payout. In a 2008 Medibank report on workplace related stress indicates that:

  • Stress related presenteeism and absenteeism are directly costing Australian employers employers AU$10 billion a year.
  • 3.2 days per worker are lost each year through workplace stress.

If we combine the Medibank data with the AIG data, stress related absenteeism can be estimated at 3.2 * $536 = $1,715 per employee per year. For stress to be a million AU$ cost impact, a company only needs 583 employees. Mind you, the top 10 largest Australian companies employ between 30,000 and 200,000 people.

Although there will be differences by industry, type of work and demographics of employees the business case is clear. Mastering stress does not only improve organizational well-being, productivity and performance. It directly saves an organization in insurance, absenteeism, preenteeism, and other stress related costs.

How to Measure Stress

Stress risk can be measured. Based on upon research and a validation study, Dr. James Petersen developed the Stress Mastery Questionnaire which has been peer reviewed by the US National Institute of Occupational Safety and Health (1983). The SMQ is a stress ‘risk assessment’ that helps identify stress risks, stress warning signs and the possible effects of stress on your health and well-being. The SMQ measures seven stress specific scales, which are all related to physical and emotional stress problems.

  1. Hostility/Anger: assesses the degree to which you are experiencing anger or frustration.
  1. Perfectionism: assesses the need to think and behave in perfectionistic ways towards yourself and others.
  1. Time Urgency: is a result of several factors including unrealistic expectations, poor time management, and procrastination.
  1. Disappointment: this scale relates to what you expect form others, from yourself or life in general.
  1. Burnout: this scale relates to the order of pessimistic thoughts and negative or sad moods.
  1. Underachievement: assesses if you believe that you live an unproductive or unsuccessful life.
  1. Tension: a high score on this scale indicates a high level of physical and emotional tension in your body.

The SMQ combines these seven stress warning signs with insights in physical stress effects and life work satisfaction. The survey furthermore assesses life events and hassles, two additional stressor scales that activate the stress response.

The SMQ can be taken on individual or group level and is now available in Australia. This creates a complete picture of an individual stress risk and provides awareness. This new awareness provides an opportunity to act and make personal changes to master stress.

How to master stress, not just manage it

As Viktor Frankl, psychologist and holocaust survivor beautifully said; ‘Between stimulus and response there is a space. In that space is our power to choose our response. In our response lies our growth and our freedom’.

A stress response is a choice. So, too, is the relaxation response. But our stress response might be so habitual and incorporated in our daily lifes, that we have to learn to let go. To master stress, every individual will go through a three-step personal change cycle.

  1. Awareness: stress mastery begins first with creating awareness about how our thinking and behaviour impacts stress. The SMQ can be a first step to create awareness. Only when we’re aware of our current reality, we can start working on changing our thinking, expectations and perceptions. 
  1. Acceptance: before we can move on, we have to accept our current reality. The outcomes of the SMQ, our strengths and our improvement opportunities. This requires ongoing reflection, feedback and exploration. A coach can help to build confidence and readiness to find intrinsic motivation to take the next step. 
  1. Action: to make sustainable change, we have to set realistic goals and commit to changing our mindset, behaviours, habits, expectations and perceptions. You can hold yourself accountable or use a coach to do so.

This triple A personal change becomes continuous if we keep working on increasing our awareness and acceptance and action improvement opportunities. A continuous personal change cycle can lead to stress mastery. In our versatile, uncertain world, with many day to day changes, challenges, pressures and demands, stress mastery provides individuals a way to improve health, well-being and performance. And stress mastery provides companies measurable value to their bottom line.

The Stress Mastery Questionnaire is the logical first step in achieving stress mastery, both for individuals and for businesses. Don’t let stress control your life or your business. Contact us at to set up your Stress Mastery Questionnaire and take the first step towards taking control of stress.