The Importance of Investing in Health as a Capital
Investments in health are often overlooked as essential capital by businesses and governments alike. However, with the rapid changes brought about by the pandemic, the importance of investing in health, both as a form of capital and to maintain a productive workforce, has never been more critical.
What is Health as a Capital?
Health as a capital refers to investing in health as an asset that will result in increased productivity, reduced health costs, and, ultimately, an overall improvement in economic growth. Just like investing in infrastructure or education, investing in health amplifies the returns and contributes to sustainable economic development.
Investing in Health Leads to Better Productivity
The employees’ health is a significant factor in determining their productivity. A healthy workforce translates to fewer sick days, less absenteeism, and higher levels of employee engagement. Proper health and wellness management lead to increased productivity and, ultimately, an organization’s financial growth. A study conducted by Medibank Private in Australia showed that a healthy employee is three times more productive than an unhealthy counterpart.
The Cost of Ill Health
Several studies have highlighted the economic costs of ill health. According to the World Health Organization, for every dollar invested in health and wellness programs, businesses save $2.5 in reduced absenteeism and increased productivity. Similarly, a report by the World Economic Forum revealed that non-communicable diseases like cancer and diabetes could cost the global economy about $47 trillion over the next two decades.
The Return on Investment
Investing in health can bring significant returns to businesses and governments. By prioritizing health, companies can improve employee satisfaction levels, leading to better retention rates and reduced recruitment costs. Moreover, the cost savings from reducing absenteeism, improved productivity, and reduced health-related expenses will result in strengthened financial performance.
Case Studies
– Johnson & Johnson, the multinational medical device, pharmaceutical, and consumer goods manufacturer, implemented an employee wellness program, resulting in a 33% reduction in medical expenses and a 224% return on investment in three years.
– In 2014, Harvard researchers conducted a study on the benefits of investing in wellness programs, ranging from yoga classes to stress management training. The study found that for every dollar invested in the health and wellness programs, there was a $6 return on investment, including decreased absenteeism and healthcare costs.
Conclusion
Investing in health should be considered as an essential capital for businesses and governments. The benefits of investing in health extend far beyond just health improvement; they can also result in improved productivity, increased financial performance, and bolstered economic growth. By investing in health and wellness programs, businesses and governments can create a long-term sustainable future.
