Think absenteeism is the biggest workplace culprit? Think again. A new study shows that presenteeism adds up to a much bigger problem for businesses.

The great Aussie sickie has become a bit a joke lately, and the practice has fallen out of favour in recent years – sort of. But while businesses are distracted with efforts to reduce absenteeism, there’s another culprit tossing a wrench in the system: presenteeism. 

Absenteeism is pretty obvious to spot: an employee simply isn’t there. The effects of absenteeism have long been realised by businesses. The 2015 Absenteeism and Presenteeism report released by the Australian Industry Group estimates that each absent employee costs $578 per day in lost productivity. This adds up to about USD$150 billion per year across the UK, US and Australia.

Presenteeism is more subtle, though, which makes it more dangerous. According to a new study, it could account for as many as 57.5 working days lost per employee each year. 

The study, a joint effort from the Global Corporate Challenge (GCC) and the World Health Organisation (WHO), collected responses from 2000 employees and employers in 17 countries. What it found was that absenteeism levels were less than 10 per cent of total presenteeism levels.

“There’s always been a real focus and reporting on absenteeism in workplaces, and that’s just part of the business mind and social norms,” says Dr Olivia Sackett, GCC Insight’s data scientist. “Presenteeism fluctuates depending on how a person is feeling; it isn’t fixed, but you know it when you see it.”

Presenteeism is when people show up, but don’t perform at optimum levels, says Dr Sackett. Just walk around your office, and chances are you will see someone pacing tasks out, surfing the internet, or coming to work sick and muscling through the day. These seem like small things, but a typical employee admits to losing 25 per cent of their day being unproductive, says the GCC study. All together, that adds up to almost three working months lost per employee each year, or a whopping USD$1.5 trillion between the US, UK and Australia.

“This data really signals that the way businesses manage staff now is not optimal,” Dr Sackett says. Although the conversation is changing around flexibility and productivity, many workplaces still have a ‘bums in the seat’ mentality. “That view stems from the Industrial Revolution when people needed to be in factories or wherever to actually do their work,” says Dr Sackett. “We’ve come a long way from that, so our approach to work has to change.”

The study found three key metrics correlated to low levels of presenteeism: sleep, stress and happiness. Workplace policies that focus on improving these three indicators contribute to lower levels of presenteeism. Dr Sackett and her research partner Dr David Batman, chief medical officer for GCC, recommend that leaders focus on creating supportive environments and encouraging employees to take care of themselves, mentally and physically. When physical and psychological health improved, levels of presenteeism decreased and productivity increased.

The most recent absence management survey conducted by the Australian Human Resources Institute found that in the past 12 months, 29 per cent of HR practitioners have seen an increase in presenteeism levels in their workplaces. The top three causes of presenteeism were work-related stress, working through illness and having no one to cover workload when away.

Leading by example is the best way to break what Dr Sackett calls ‘presenteeism cultures’: workplaces where everyone arrives early and stays late because precedent has been set by leadership. She says the research found that when overtime hours decreased, there was a corresponding increase in productivity.

“The research is supportive of fundamental change to the way people conduct business,” Dr Sackett says. “This approach – focusing on presenteeism instead of absenteeism – is still experimental at this stage, though, so watch this space.”