The ROI of a Good Night's Sleep

By Nancy H. Rothstein, MBA
The Sleep Ambassador®
Director, CIRCADIAN® Corporate Sleep ProgramsTM
employee falling asleep

For cost conscious employers, it’s time to regard employee sleep as a core corporate investment. Employee sleep is a valuable asset with an ROI demanding attention. The question is not when you will offer Sleep Wellness initiatives, but if you can afford not to.

Sleep is not optional; it’s a necessity, as essential as food and oxygen. Irrefutable scientific evidence reveals that the third of our lives that we spend sleeping profoundly impacts the two thirds we spend awake.[1] Sleep is critical to virtually all aspects of our functioning and affects the performance, safety and health of every member of your workforce. Our biological needs have not changed. Yet our behaviors have changed due to the extended demands on our time, often leading to sleep deprivation, which is wreaking havoc on your employees.

A WAKE UP CALL FOR MANAGEMENT

Here’s the bottom line: How employees sleep at home directly impacts how they function at work, on virtually all levels. Be it productivity, performance, safety, health or health care costs, sleep deprivation has a significant impact on an employee and in turn, on their employer.

The evolution of a 24/7 society has caused sleep debt (the cumulative effect of not getting enough sleep)[2] to steadily increase. Unfortunately, this liability is not reported on balance sheets, but it is likely impacting your bottom line.

Consider the findings of a 2012 study: “When employees are low on sleep, they will engage in more workplace cyberloafing. In the push for high productivity, managers and organizations may cut into the sleep of employees by requiring longer work hours. This may promote vicious cycles of lost sleep, resulting in less time spent working, which could result in more frantic pushes for extended work time. Managers may find that by avoiding infringement on employee sleep, they will get more productivity out of their employees”[3] and more effective use of their time.

In our 24/7 culture, the line between work and personal time is often blurred. But all of our time is compromised when we do not get good quality and quantity sleep. As companies demand more from their employees, our waking hours are stretched all the more. At what cost?

THE COSTS

The CDC recently announced that insufficient sleep is a public health epidemic in the United States. Sleep insufficiency has been linked to motor vehicle crashes, industrial disasters, as well as other occupational errors.[4]

A National Consumer Research Institute study reported that 76% of Americans want to improve the quality and quantity of their sleep,[5] while the National Sleep Foundation reports that over 60% of adults have sleep problems a few nights a week or more.[6] According to the CDC, 30% of the U.S. civilian adult workforce reported getting 6 hours or less of sleep per day, less than the 7 to 9 hours recommended by the National Sleep Foundation. Consequently, “Because short sleep duration is associated with various adverse health effects, decreased workplace and public safety, and impaired job performance, targeted interventions are needed to increase the proportion of adults who get sufficient sleep.” [7] What are the costs of sleep deprivation to your workforce?

Showing up at work but being less than fully productive is referred to as “presenteeism.”[8] Sleep deprived workers go to work, but their productivity is greatly compromised because they are so tired. For instance, one Harvard Medical School study found that 1 in 4 U.S. workers has insomnia, costing U.S. employers $63 billion in lost productivity each year. Insomniacs were no more likely than their well-rested peers to miss work, but they were so consistently tired on the job that they cost their employers the equivalent of 7.8 days of work in lost productivity each year -- an amount equal to an average of about $2,280 per person.[9] [10]

What are the costs to your company of insufficient employee sleep? Consider The 10 Dangers of a Sleep Deprived Workforce,[11] which highlights the various risks associated with sleep deprivation, including: poor cognitive assimilation and memory, greater risk taking behavior and general performance deterioration across a myriad of functions. Many who are sleep deprived think they are performing fine; when in fact, they are unaware of their performance decline. Furthermore, consider sleep deprivation’s impact on effective teamwork, another example of the powerful ripple effect of a sleep-deprived workforce.

The costs are high. A 2006 study by the Institute of Medicine confirmed that billions of dollars are spent each year in the United States on the direct costs of sleep loss and sleep disorders. Add to that the tens of billions of dollars in annual expenditures due to indirect costs such as accidents, litigation, property destruction, absenteeism, disability, reduction or loss of productivity, hospitalization, and death. In fact, the study states that a conservative estimate of the total annual cost of insomnia alone was as high as $107.5 billion per year[12] -- and that’s just one sleep issue!

THE SOLUTION:
SLEEP EDUCATION & TRAINING- INVESTING IN HUMAN CAPITAL

Recognizing the urgency for a response to sleep health, by providing sleep education and training, corporate leadership can influence a paradigm shift both within the corporate culture and for employees to carry home. With the Internet at our fingertips, sleep information is prevalent. How do we use this information to create a pathway to sustainable sleep improvement?

Today, companies invest in their human capital with a wide range of training and development initiatives. Investing in sleep education and training offers ROI benefits across a broad spectrum of performance, risk and cost related measures. A well-rested workforce is more likely to excel in productivity, concentration, motivation, information processing, judgment, reaction time, and energy. Add to that the relationship between sleep duration and mood regulation, along with sleep deprivation’s impact on effective teamwork, and a powerful ripple effect results.

While many corporate functions can be outsourced, an individual employee’s sleep cannot. At the end of the day, or night, the employee is in charge of their sleep habits and behaviors. However, companies can outsource to sleep experts the critical sleep education and training for their workforce, empowering employees to improve and reprioritize their sleep – not only for work, but also for their personal health, and ability to enjoy hours spent awake. Now that’s a perk! Here’s a way to enhance employee loyalty and dedication to the company by being an employer who values a work-life balance.

Sleep education and training may be one of the most powerful, yet underutilized resources available to leverage and optimize human capital within your company.

CONCLUSION: THE RETURN ON INVESTMENT

Research confirms that employee sleep is a critical asset that impacts employee productivity, performance, health, safety and the bottom line of your company. Far from being a time waster, sleep makes everyone more productive, healthier and safer.

In today’s society where people work well beyond “normal” hours, sleep needs to be a priority for both employee and employer. Yet, this may require a shift in corporate culture, with management supporting the reprioritization of sleep. For corporate management, a well-rested employee will yield a higher return than an employee putting in 16-hour “days” on a regular basis.

Corporate management has an opportunity to optimize its workforce by providing expert Sleep Wellness education and training initiatives so employees can optimize their sleep. The ROI of a good night’s sleep has multiple returns. It’s time to wake up your workplace to the power of sleep.


About CIRCADIAN

CIRCADIAN® is the global leader in providing 24/7 workforce performance and safety solutions for businesses that operate around the clock. Through a unique combination of consulting expertise, research and technology, software tools and informative publications, CIRCADIAN helps organizations with traditional and/or extended operating hours optimize employee performance and reduce the inherent risks and costs of sleep deprivation and fatigue.



[1] Sleepless In America, Documentary produced by National Geographic, the National Institutes of Health and The Public Goods Project. December 2014

[2] Dement, William C., MD, PhD, The Promise of Sleep. Delacorte Press, Random House Inc., New York, 1999.

[3] Wagner, D. T., Barnes, C. M., Lim, V. K. G., & Ferris, D. L. (2012, February 27). Lost Sleep and Cyberloafing: Evidence From the Laboratory and a Daylight Saving Time Quasi-Experiment. Journal of Applied Psychology. Advance online publication. doi:10.1037/a0027557

[4] Centers for Disease Control, Insufficient Sleep Is a Public Health Epidemic. CDC Features.

[5] National Sleep Foundation, National Consumer Research Institute Predicts Top Five Health Trends for 2012. Sleep News, December 2011.

[6] National Sleep Foundation, 2009 Sleep in America™ Poll, Highlights and Key Findings, March 2009.

7] Centers for Disease Control, Short Sleep Duration Among Workers- United States, 2012. Morbidity and Mortality Weekly Report (MMWR), April 27, 2012/61(16); 281-285.

[8] Hemp, Paul. Presenteeism: At Work – But Out of It, Harvard Business Review, October 2004.

[9] Kessler RC; Berglund PA; Coulouvrat C; Hajak G; Roth T; Shahly V; Shillington AC; Stephenson JJ; Walsh JK. Insomnia and the performance of US workers: results from the America Insomnia Survey. SLEEP 2011;34(9):1161-1171.

[10] Insomnia costing U.S. workforce $63.2 billion a year in lost productivity, study shows. American Academy of Sleep Medicine, News Archive, September 1, 2011.

[11] 10 Dangers of a Sleep Deprived Workforce. Circadian®, July 10, 2014.

[12] Institute of Medicine (US) Committee on Sleep Medicine and Research; Colten HR, Altevogt BM, editors. Sleep Disorders and Sleep Deprivation: An Unmet Public Health Problem. Washington (DC): National Academies Press (US); 2006. 4, Functional and Economic Impact of Sleep Loss and Sleep-Related Disorders. Available from: http://www.ncbi.nlm.nih.gov/books/NBK19958/

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