IBI President Kelly McDevitt recommends that employers reevaluate their products and programs to ensure they meet employees' changing health and well-being needs. (Image: Shutterstock)
Lost work time because of the pandemic has cost U.S. employers more than $50 billion, according to the nonprofit Integrated Benefits Institute. This represents a 117% increase from a previous analysis conducted a year ago.
The assessment includes potential sick leave wages, short-term disability payments and spending on employee benefits:
- Disability wage payments, $10.7 billion
- State disability insurance (specific to California and New York), $1.6 billion
- Sick leave wages,$15.5 billion
- Employee benefits, $22.7 billion
- Total cost to employers, $50.5 billion
Click to enlarge | Source: IBI Recommended For You
"The age-old insurance industry definition of 'productivity' has certainly been redefined by the pandemic," IBI President Kelly McDevitt said. "As such, employers should closely examine their products and programs to ensure that their go-forward strategy as a company meets the needs of their employees and families in managing their health and well-being in this new environment."
The analysis was conducted on April 12 when there were more than 31 million diagnosed coronavirus cases in the United States. The states with the highest lost work time costs are California, Texas and New York. The metropolitan areas that have the largest lost work time cost burden are New York-Newark-Jersey City; Los Angeles-Long Beach-Santa Ana; and Chicago-Naperville-Joliet.
IBI used employment, wage and leave benefit data from the U.S. Bureau of Labor Statistics and lost workday experiences contained in its own dataset of employer-sponsored disability claims to model lost work time impacts based on the total U.S. COVID-19 case count. Population data from the Census Bureau also were incorporated to reflect geographic variation in COVID-19 cases, employment patterns, industry mix and wages.
"Disability carriers and self-insured employers have lost a lot because of the sheer number of employees who have had to recover or self-isolate from COVID," said Brian Gifford, Ph.D., director of research and analytics for IBI. "But employees who have had to take time off because they got sick with COVID have also lost more than $21 billion so far as disability wages pay an average of 62 cents on the dollar. A majority of employees have no disability coverage at all, and many don't even have paid sick days."
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Alan Goforth
Alan Goforth is a freelance writer in suburban Kansas City. In addition to freelancing for several publications, he has written a dozen books about sports and other topics.
