Why You Need to Worry About Employee Burnout

By business.com editorial staff,
business.com writer
| Updated
Jun 24, 2020
Image Credit: BongkarnThanyakij / Getty Images

Employee burnout isn't a personal issue – it affects your entire organization.

  • Employee burnout can be caused by both internal and external factors. Too many responsibilities and an undefined role in the organization are two examples of common burnout causes.
  • Employee burnout has a negative impact on an organization by decreasing morale and increasing employee turnover.
  • Changing the hours or duties of an employee are two effective strategies for dealing with employee burnout.

Chronic fatigue, disengagement, low motivation and poor performance – these are just some telltale signs of employee burnout that companies need to pay close attention to.

Employee burnout is not a personal issue or an indicator of incompetence. Rather, it is a challenge that needs to be tackled from an organizational level.

Workplace stress, in fact, is primarily caused by ineffective leadership and flawed organizational practices. A Harvard Business Review article cites poor management and excessive workload as the common culprits behind employee burnout. Long hours and impossible demands from superiors also contribute to work-related stress.

Causes of employee burnout

Employee burnout can occur within any organization. Although there is a blend of causes for employee burnout, many are directly related to the employee's role within the organization. Managers should avoid overwhelming their employees with responsibilities that go beyond the scope of what they were hired for. Another cause of employee burnout is not providing clear expectations to each employee. If the employee is unsure of his or her place in the organization, burnout is more likely to occur. Each employee should have an assigned role with set duties that are not open to interpretation.

Issues between managers and colleagues are another common cause of burnout. For instance, if one of the employees is known as the office bully, co-workers may feel stressed and burned out from constantly dealing with the negative personality. Ineffective or micromanaging bosses can also contribute to employee burnout.  

According to the Mayo Clinic, personal issues could also be at the root of employee burnout. For instance, the employee may be socially isolated and not have a support system outside of work to rely on. The employee could also be not making work and life balance a priority. 

Why should companies be concerned? Here are four reasons.

1. Decreased productivity

A mounting body of research demonstrates a positive correlation between an employee's health and well-being and their productivity at work.

study conducted by the U.K. government shows that positive employee well-being results in improved performance, productivity and work quality. Another study conducted by IZA World of Labor claims that an increase in employee well-being leads to parallel increases in productivity.

These studies show that an employee's health and well-being play a critical role in the quality of the outputs they produce. Simply put, an employee who is healthy and well-rested is more likely to deliver high-quality output compared to an employee struggling with a demanding workload.

If an organization is committed to its success, it must invest in the well-being and happiness of its employees. 

2. High turnover rate

In a study conducted by Kronos and Future Workplace, burnout is cited as one of the top reasons behind employee attrition. The same study points out that burnout is the biggest threat to workforce retention, as reported by 95% of human resource leaders.

What are the implications of these findings? A high turnover rate comes with an equally high price. It not only affects the productivity of the entire workforce, but it costs the organization thousands of dollars.

Research by the Center for American Progress points out that companies spend 16 to a whopping 213% of an employee's salary to cover the costs of finding a replacement.

Aside from the added costs, companies risk losing their top talent because of burnout. Most managers tend to overwork their best employees without giving much consideration to their well-being. As a result, top-performing employees are more likely to fail to meet expectations or maximize their potentials. Worse, they get burned out and quit.

The takeaway: Burnout not only comes with a hefty price tag, it drains valuable talent from the organization.

3. Low employee engagement

Engagement pertains to an employee's commitment to the company's goals. An engaged employee is more likely to work hard and exert more effort, because he or she values the success of the company.

A highly engaged workforce is crucial to the growth of the organization. In contrast, disengaged employees can derail its success.

Disengagement translates to significant losses in revenue because of its adverse impacts on employee productivity and motivation. When employees are overworked or not given sufficient time for rest and relaxation, they are more likely to underperform. In effect, the productivity of the organization is hampered as well as its potential to generate more revenue.

4. Negative health impacts

The U.S. government spends $125 billion to $190 billion annually to cover healthcare costs related to psychological and physical problems related to burnout. This accounts for up to 8% of the national budget for healthcare, according to a Harvard study.

The research also reports that work-related stress contributes to 120,000 American deaths annually. These figures only prove that burnout comes with costly consequences.

Overworking can be taxing to both one's mental and physical well-being. The stress induced by working long hours may lead to mental illness, anxiety and other serious health conditions like heart disease. Moreover, a stressed-out employee is more likely to develop unhealthy behaviors like binge drinking and overeating.

Working too much can literally make a person sick, and with today's high healthcare costs, this can translate into thousands of dollars in medical and insurance expenses. Aside from that, when an employee is sick, he or she is more likely to take more sick days, and the rest of the team is forced to bear that burden. 

Employee burnout is one of the pressing challenges that business leaders face today. Creating a positive working environment and making earnest efforts for successful culture creation should be among the top priorities of any organization.

A company's workforce is its No. 1 resource. If employees' health and well-being are given utmost importance, engagement increases, along with productivity and motivation.

In the end, it's a win-win situation for everyone, as employees are happy, and the company benefits from their productivity.

business.com editorial staff
business.com editorial staff
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