Are employee wellness programs worth it?
Corporate wellness programs are becoming the norm for small and large organizations.
Employees get better access to tools and guidance to improve their physical, mental, and emotional health, and employers see healthier, happier, more engaged teams.
But what leaders really want to know is simple: What is the ROI on corporate wellness programs?
With budgets tightening and HR teams defending every dollar, is now the right time to invest in a corporate wellness program? Can implementing a plan increase workplace productivity and generate a return on your well-being investment?
This post breaks down everything you need to know, from the benefits of wellness programs to ways of measuring program success and ROI.
Employee wellness initiatives included in a well-being program can yield many benefits for employees’ mental, emotional, and physical health. A successful program can also improve productivity, reduce absenteeism, and employee turnover.
An individual approach to the fitness, nutrition, and mental health of your employees, together with BetterMe employer support – you’ve got everything at your fingertips. What are you waiting for? Access all the benefits now!
A more detailed list of wellness program benefits includes:
84% of employers reported higher productivity and performance from employees because of their wellness program at work (1).
Additionally, another study found a 3.9% productivity increase for employees who participated in the company’s employee wellness program and a 5.8% for employees who did not participate (2).
Other scholarly articles on employee wellness programs show similar results.
When employees are equipped with the tools to improve their physical, mental, and emotional health and well-being, it can help reduce healthcare costs and premiums.
Reduced healthcare costs often contain a hidden ROI.
Most workplaces focus on productivity metrics, but not on how much they save annually on healthcare plans and premiums, which quickly adds up.
One study examined the effectiveness of a 12-week workplace wellness program among 518 participants (84% female). Results showed significant decreases in all anthropometric measurements and significant increases in all fitness outcomes from baseline to follow-up after the program. The estimated cost per participant was $473 per session, while weight loss is estimated to reduce annual medical care costs by $2,200 (3).
By improving employee well-being, they helped cut annual medical costs and had healthier and happier employees as a result.
Benefits of corporate wellness program statistics show similar results across various industries.
Read more: Do corporate wellness programs work?
Wellness programs can improve retention and attract top talent.
While it’s not a guaranteed benefit, a well-designed wellness program is likely to improve employee happiness and job satisfaction.
We recommend recording a baseline retention rate and comparing it to post-program intervention (at regular intervals).
With fewer employees leaving for organizations that perhaps had better wellness offerings, this reduction in hiring and training costs allows more money to be spent towards upskilling employees (also plays a big role in retention) to create better, more productive employees who are better at their job and get more job satisfaction because of it.
Wellness programs have the potential to reduce absenteeism by 14-19% (1).
A cohort study analyzed the effect of an employer-sponsored well-being benefit program, which looked at 66 employers across 40 states from 2018 to 2021. To qualify, participants had to have at least moderate levels of stress and ongoing mood-related concerns, based on the study’s screening criteria (4).
Program results show significant improvements in anxiety and depressive symptoms. Employees reported fewer missed workdays and improvements in productivity measures, resulting in an estimated $3,440 in salary savings (based on assumed regained productivity and unproductive days).
Wellness programs not only benefit employees who have higher day-to-day stress or emotional strain — all employees can benefit from increased access to mental health training and resources.
For example, BetterMe has two apps, one for physical and mental health to support employee health and well-being. Regular exercise is positively associated with improved mood and mental well-being, confidence, and body image (5). Meditation and mindfulness sessions can help many people feel calmer.
By improving your well-being offerings, you equip employees with the tools and knowledge to build sustainable habits that support physical and emotional well-being.
If you are experiencing physical or mental health issues, consult with a healthcare professional or physician.
Are you looking to transform both your business and the lives of your team members? BetterMe corporate wellness solutions provide a holistic approach to physical and mental health that boosts productivity and job satisfaction.
To better illustrate the benefits and expected return on investment of an employee wellness program, we have a case study example.
The case study investigated the effect of a new corporate wellness program on 111 workers across five laundry plants (1 plant served as a control to better compare results).
As part of their corporate wellness program, the laundry plants introduced various wellness interventions, including annual biometric blood screening and health surveys and screenings that asked about their health background, including stress levels, substance use, and other behaviors.
All employees received a customized report of their results, along with customized suggestions for improvement and areas they may want to pay attention to increase awareness of certain destructive habits and behaviors or health-related concerns. Educational seminars were held at the plants to increase awareness and to signpost where and how to get help for the higher-risk concerns.
Additionally, those who were most at risk were contacted by a nurse, with their results forwarded to a physician (with approval).
The laundry plants and participants who took part in the new program saw a 3.9% increase in productivity, while those that did not saw a 5.8% decrease. Likewise, employees who improved their previously screened biometrics saw increases of up to 10%.
The ROI of the case study was calculated on productivity gains. The program saw a 76% ROI, and note that if participation rates were higher and staff turnover minimal, the ROI could be as high as 590%.
For this example, productivity was defined as workers’ daily efficiency — their garment processing rate (how many items a worker processes per hour vs. a benchmark).
These examples do not account for potential healthcare-related cost impacts associated with offering screenings and encouraging appropriate follow-up care. This may help some employers reduce certain costs over time (for example, costs associated with absenteeism and turnover), depending on participation and other workplace factors.
Furthermore, the U.S. Chamber of Commerce found that employer-sponsored health coverage (including wellness benefits, insurance, and access to medical care) provides an estimated 47% ROI in the United States. Moreover, for employers, the largest share of return is improved productivity, reduced direct medical costs, and additional tax benefits (6).
Read more: What Are Employee Wellness Programs? Key Benefits and How Top Companies Use Them
Effects of wellness programs in the workplace extend beyond improved physical and mental health.
By introducing wellness activities and initiatives like health talks and workshops, fitness classes, workplace challenges, meditation sessions, and 1-on-1 coaching with experts, you can improve productivity, reduce stress, and get a notable return on investment.
When a wellness program is done correctly (tailored to your organization), you’ll create happier, healthier, and more productive employees.
To effectively measure return on investment on a corporate wellness program, you first need to establish a baseline.
Identify relevant quantitative health and performance metrics, such as absenteeism, sick days, healthcare costs, and, if possible, productivity (as in the laundry plant case study earlier in this post). In addition to administering well-being screenings, you can also compare these results annually to see how your well-being program may influence trends in healthcare-related costs and support overall well-being over time.
You also want to use qualitative data, such as employee surveys and interviews, to see firsthand how employees use the wellness activities available to them (as well as what they’d like to see/would improve).
After you have a baseline, you can start your program and measure program success at regular intervals, either every 6 months or 1 year. Keep in mind that some benefits are more likely to be seen in the long-term rather than immediately.
You will soon have data, including healthcare costs and premiums, and employee engagement scores to adjust your program as needed to help you and your employees get the most out of your wellness offerings.
Corporate wellness programs can deliver measurable ROI when they are aligned to business goals, well-adopted by employees, and tracked against a clear baseline. The most defensible ROI models tie outcomes to changes in productivity, absenteeism, and retention over time.
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