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Optimizing productivity in a stressful age

Remarks to the HR Leadership Summit by Bill Morneau, Executive Chairman, Morneau Shepell

Good morning – and thank you for inviting me to your conference. It’s a real pleasure to be here.

I really believe that Human Resource leaders are the key to our country’s competitiveness, and I’m happy to be playing a small part in that discussion.

What brings me here is a matter that should be of enormous concern to everyone in business: the connection – the relationship – between productivity and mental health in the Canadian workplace. And specifically:

at our uniquely robust database – the information that we have as the largest provider of Employee Assistance Programs in Canada. The study has validated our database as the biggest, most comprehensive resource in Canada on how mental health issues are manifest in the workforce.

To set the stage for my discussion this morning:

  • Our database is built on the inputs of some 8,000 clients across Canada – the majority of large and mid-size enterprises in the country, plus many smaller organizations, in both the public and private sector.
  • It reaches into the lives of some five million Canadians. Or roughly one seventh of the population. So, big numbers.

And that translates every year into:

  • Some 500,000+ calls that come into our counsellors.
  • 400,000+ new cases that are opened.
  • And 80,000 of those relate directly to mental health.

Now before we get into the study and what it means for HR leaders and Canadians interested in labour force productivity, I would like to set some context.

I’m personally neither an expert in mental health or productivity.

But in terms of the relationship between them and what it means for business, I do have a reasonably strong feel for that.

I’ve spent a fair bit of my career in the world of:

  • Pension design and delivery.
  • Disability management.
  • Employee benefits.
  • Helping companies like yours manage these costs.
  • All those rising costs – yes, that keep rising.
  • The world I’ve lived my career in is the world of actuaries, and data.
  • But not incidentally, it’s also the language in which productivity is talked about and debated in the C-suite.
  • It’s the world of: show me the numbers, the ROI.

But then in 2008, a very difficult time in the markets, we at Morneau made a huge $300 million bet when we acquired Shepell.fgi, the Canadian leader in Employee and Family Assistance Programs.

We knew that labour force productivity would emerge as perhaps the defining issue of the next era in Canadian business, as the demographics don’t lie.

We knew there was an opportunity to learn more about what was behind the data. To be able to get into the business of actually helping people and learning what they’re feeling and thinking.

And that’s not the world of actuaries – but of counsellors, therapists, psychologists, healthcare professionals, and thought leaders and researchers in mental health and the workplace.

These are people that your people talk to every day by the thousands, and go to when they need assistance. Or when they need someone to deal with their most fundamental personal concerns. And that includes employees who may be sick – either physically or mentally – and who want to get back on their feet, back to work, and feeling productive again.

So, in a real sense, I’ve had a chance to observe up close:

  • The world of data and productivity on the one hand.
  • And mental health in the workplace on the other.

I’ve since realized that these two different worlds have a lot to tell us – and you as HR leaders – when they come together. And it relates directly to a big challenge facing Canadian business today.

When it comes to workforce productivity among OECD countries, Canada ranks somewhere near the bottom, 28 out of 34.

Now this is a very old story – a perpetual source of angst in think tanks across the country. But, even so, it’s still remarkable, if you think that high productivity should be an outcome of our situation in Canada as the world leader in university graduates by population.

Where is the disconnect here?

For at least a generation now, we’ve heard the plaintive calls from the big stakeholders and policy influencers: moving the dial on productivity is mainly about investment, innovation and R&D. And linked to that is the need for public policy to support education in math and the sciences, and to increase corporate investment in new plant and equipment. That’s all well and good. And important.

But as HR leaders, you know the challenge runs much deeper and is more complicated. You also know the debate about productivity in this country does not adequately factor in issues like mental health in the workplace, especially in Canada today.

Think about the changing social, demographic and competitive realities in Canada that are in effect rewiring our psychological environment. Think about how it affects the attitudes and behaviours and increases the stress and anxieties that our people bring to and experience daily at work.

How about:

  • Financial insecurity. Debt levels of Canadians are rising, and so are their feelings of uncertainty about the stability of global financial markets.
  • Job security. The average job tenure is declining and will continue to decline. We all see the consequences of the need for immediate job effectiveness, and of changing skill requirements. The people in this room understand it better than anyone.
  • Globalization in general is causing stress. Fear of losing your job to someone in a different country. Or a company coming here and putting yours out of business. And with globalization, there’s immigration, and with it the amazing diversity that energizes our workforce and country. But diversity, for some, sadly, is still a source of stress.
  • Demographics. The middle class is sandwiched between worries over aging parents and their Millennials struggling to get out the door. Other factors, like changing family structures, marital discord and longer life spans bring huge stress. People worry: Will I have enough to retire on?
  • Corporate turbulence itself is causing even more stress:
    • Downsizing.
    • Technology taking jobs and entire sectors away.
    • Decrease in unionized power and loss of worker status.
    • Not to mention the decline of defined benefits plans.

We know none of this is going away.

Now, as you think about these sources of stress, how much of this can you – in the HR function in one company – control?

Very little. But you can mitigate or remediate against their effects.

The question for you, as HR leaders, is how much of that is your responsibility? I mean, why should you care?

You have to care if you want a productive workforce. Effective people are the single greatest factor in labour force productivity.

But you can’t get there on your own.

Broadly speaking, we know the debate around productivity needs to move in new directions. It needs to better take into account mental health as an enabler. We need more progressive logic here, absolutely. Better research, advocacy, awareness.

But I say this respectfully – HR leaders need to be more proactive by getting better data for better arguments in the C-suite when it comes to the impact of stress and anxiety on your business.

Are you as concerned as I am?

We know in the abstract through research that mental health is a productivity factor. But how good is our data on our own companies, on what our own people are feeling and thinking?

Most of us in larger organizations have:

  • Employee satisfaction surveys.
  • Engagement scores.
  • Focus groups.
  • And town halls.

I’m not questioning the best intentions or best practices in HR.

I’m just sure that we don’t know enough – or not enough to get CFOs or CEOs to sit up and say, let’s make change right here, right now.

Where does my skepticism lie?

Maybe I can start with a question about our data sources, informed by what’s going on in politics.

It’s shocking how bad public opinion polls are these days.

Look at the recent BC election where the results were radically different than predicted in the polls.

If you talk to anybody in the pollster world, they will tell you that they have had their world turned upside down in the past decade. When people actually answer their phones, they aren’t responding to their questions any more – or they respond cynically. And when people do respond, they reveal only part of the story. And, maybe more importantly, people’s attitudes and impressions are more dynamic and subject to volatile swings than they have ever been.

Now translate that into a business.

We all have our people metrics that we poll against.

Well, consider what those metrics are truly worth.

Because, if it’s an emerging truth that assessing the status quo or making a forecast is hard to do in the most sophisticated polling areas that exist, which is public service, why do we think that we, in business, with our meagre efforts, relatively speaking, have a better grip on what our constituency is feeling or thinking?

Think about the conditions under which our people respond to requests for data. They do so in part under the pressure of compliance. Think about all the directors and managers who need to get that new survey off their desks. Because it’s required.

I know there are people here who say, hey, you’re wrong. We’re doing a good job of this. We understand what is going on in our companies. We’re ahead of the game on this issue. We know how our people are feeling, what they’re really thinking.

But if you do – it’s a secret.

I can tell you, we’re not getting the questions from our 8,000 clients that we should be getting about our data on workforce stress.

The other day, I asked one of our consultants about whether any of our clients have expressed a genuine interest in the incidence of workplace violence and harassment in their companies. And the answer I got was, we can’t remember the last time anyone really asked us to do a deep dive on that.

Now there are some reasons why that might be so. The data we collect is confidential. Even so, the aggregated data can be confidentially and ethically separated by location, job function, demographics – you name it.

What concerns me is this:

  • If we don’t know what’s going on – if we don’t know how our workforce is really feeling or why – then we can’t possibly deliver on the objective of a highly engaged and effective workforce.

Getting good data really does matter.

And that brings me to our joint study with Queen’s University that I mentioned earlier.

The study was led by Professor Heather Stuart who is known internationally as an expert on mental health research. At Queen’s, she’s the Bell Chair on Mental Health, and she is also a Senior Consultant to the Mental Health Commission of Canada.

For the past six months, Professor Stuart and her research team have been looking closely at 500,000 randomized interactions from the Morneau Shepell database I talked about earlier.

There are some caveats.

The people using EAP programs are self-selecting, or self-reporting. That’s a factor in assessing the data.

Another is that EAP utilization is significantly weighted to Canadian workers who work for large enterprises – not small and medium sized companies that form so much of the Canadian workforce.

Even so, we talk to thousands of Canadians every day. We hear, and we track, what Canadians are feeling about their jobs and what affects their productivity at work.

While this is a database with statistical integrity, it’s also a window into something fluid and very much alive.

As I see it, we’re that canary in the coal mine on the front lines of some very serious issues that, down the road, may enter the health care system as much more troubling conditions.

In summary, this is what we’ve learned:

  • In several key indicators, workforce stress levels have virtually doubled in the past four years. And that is evident in rising mental health claims and the related cost of high absenteeism and low morale among Canadian workers.
  • More worrisome, especially given Canada’s poor productivity performance, workplace stress is likely to get worse before it gets better. And that could inhibit efforts to improve Canadian productivity performance.
  • At the same time, the study provides new insights into how HR leaders can be more effective in managing and mitigating the effects of workplace stress and anxiety.
  • It clearly suggests that remediation works. This is reflected in significant reductions in time off work – absenteeism – for people who seek help in contrast to people who don’t.

So let’s dig deeper.

1. There is very little good – or workable – data out there on mental health and the Canadian workplace.

This isn’t a profound finding but worth discussing anyway.

Doctors, hospitals and other service providers in the health care sector are still migrating from paper-based systems where data is hard to use and even harder to share. And, of course, they do not share information easily for reasons of confidentiality.

Governments and other important stakeholders – CAMH comes to mind – are collecting data on mental health incidence in different ways. And there is plenty of research out there on mental health and productivity. But as a living source of data on what is actually happening in the Canadian workplace, our database, as the study confirmed, is the biggest and most robust source in Canada.

2. Against a 2009 baseline, workforce stress levels have doubled in the past four years. One in four people report mental health illness as the primary presenting issue.

Looking back four years, which is our baseline you see:

  • A doubling of financial stress incidence.
  • A tripling of personal stress incidence.
  • And a significant increase in workplace stress.

Some 25 per cent of all cases opened cited mental health/illness as the primary presenting issue. That’s one in four people.

3. Stress levels are consistent across industry sectors but within each there is high variability among companies – and, variability among different locations within companies.

You would think certain industries are more prone to workplace stress. The data suggests otherwise.

A good example relates to workplace violence and harassment.

Without naming names, or demonizing one sector over another, the study reveals that in terms of workplace violence and harassment, there is a median of 2.4 incidences per 100. This is consistent across three different sectors.

Within those sectors, however, some companies showed a five or six times incidence rate above the median. A significant deviation.

What to make of this?

What if you knew your company was one of those with a six times incidence? Would you adapt your people strategies as a result?

4. Geography isn’t a factor.

There is a bias out there, I believe, to suggest that geography should be a factor in differing stress levels. It stands to reason that in a region that is distressed economically, the stress levels should be higher. Or, in a place where people are stretched too thin, like the oil patch, stress might be higher than in, say, an office building in suburban Ontario.

But as it turns out, this bias is not proven out in our data. The closer we looked at the data, the more it became apparent that the real difference was between company locations that just happened to be in different geographies.

Put another way, if you blame geography, you blame something you can’t change unless you move. But if the real problem is a particular location in a particular company, you might be able to look closely at that situation and change what’s happening.

5. Among the 500,000 calls we get every year, some 40 per cent of people report being in poor mental health.

I want to stop here for a moment. That’s 40 per cent of people reporting mental health challenges. Some might say, well, it’s an Employee Assistance Program, of course everyone’s in poor mental health. That’s just not true. People call into these programs for many reasons – getting help for an elderly parent, a physical injury, a problem with child care.

This 40 per cent number covers ALL the calls we get for every presenting issue, not just those that get opened as mental health claims.

The point I’m making is, in tracking a number like 40 per cent, wouldn’t you want to know what the number is, and whether over time it is increasing or decreasing in your own company?

6. Workplace stress is likely to get worse before it gets better.

Think about the rise in Canadian consumer debt levels in the past decade. Let’s correlate that with the fact that, over the past four years, our study shows a doubling of financial stress.

Now, think about the current outlook for bond yields for the next three years. Think about the tail end of the curve and what you definitely see are rising interest rates. That’s what factored into the market today. Now move that tail on bond yields forward:

  • Three years from today, with interest rates likely higher and knowing what we know about financial stress in the past four years, where do you think stress and anxiety levels are headed?

Higher, it is very reasonable to assume.

7. Technology is a double-edged factor in workforce stress.

Part of the work that Morneau Shepell contributed to the study was our analysis, building on field work with our clients, of how digital modes of interaction are changing EAP utilization.

Some trends are waiting for their 15 minutes of fame.

The 20-29 age group, as you would expect, is twice as likely to access an EAP program through digital means than any other group. That’s a 53 per cent increase year over year.

Visits to our EAP information website from mobile devices have gone off the charts – a 700 per cent increase in the past year alone.

We’ve also seen a huge spike in video chat and text-based counselling – with over 1000 people every month making use of these types of services.

In other words, digital interaction will increase utilization and will figure into your remediation strategies in a larger way tomorrow.

Is it all good news?

Digital technology and devices introduce new variables of clinical interest for researchers in mental health.

Information overload is only the most well-known problem.

We are only beginning to classify, never mind understand, the more problematic and psychological impacts of digital life and devices on social and occupational functioning.

An emerging body of research suggests that digital modes of interaction are a powerful force – and medium – that could have consequences related to workforce stress and anxiety.

But, let’s face it: technology is not going away. And creating a workforce culture adaptable to its impacts is a crucial part of what HR leaders should be thinking about today, right now.

8. Remediation works.

First: EAPs are not a panacea.

In fact, and this comes from a guy with a big stake in selling EAPs, EAP programs are simply not enough!

What the study tells us, however, is that the benefit of early intervention – and interaction with counsellors and other caregivers and experts – shows up in numbers you will appreciate.

Let’s look at several indicators related to time off work that someone takes, pre-counselling and then post:

  • Addiction: People with this presenting issue took 26 days off before counselling. Post counselling: 2.7.
  • Couple relationship issues: 29.7 days before counselling. Post counselling: 16.1 days.
  • Personal emotional issues: 54.2 days before, 41 days after.

In terms of Workplace Stress itself, an indicator that I know will be of interest to this group,

the time off work before counselling was 50.2 days. And post counselling: 33.7.

Would these numbers have declined anyway, irrespective of an intervention? We don’t know. But everything we’re seeing and hearing points in the direction that remediation is consequential.

That remediation – in whatever form – works.

So, you may question whether it’s possible to get people to help themselves. Maybe they just won’t seek help, even if you create the right environment? Well, let me give you our case example.

In the fishbowl of my own company, when the actuaries from Morneau joined up with the counsellors from Shepell during our merger five years ago, something very interesting happened.

Prior to our merger, at Morneau, in the largely actuarial culture, we had only an 11 per cent utilization of our Employee Assistance Program. Shepell was in the 60 per cent plus range. And what happened?

It’s interesting. The irony is when the "hard" data culture met the so-called "soft" culture of therapy and counsellors – what won?

The right approach won!

As a combined company, our usage today is in the 65 per cent range.

Can I say that higher utilization categorically improved my business? No. But I believe it did. And does. Especially when I look at what we have achieved since we came together.

And for those doing the math – how much did this cost us?

The cost of increased utilization works out to a .05 per cent increase in our payroll. Almost a rounding error.

What can you take away from the work we’ve done with Professor Stuart and her team at Queen’s?

What I hope is that it becomes a launching pad for new questions, and for harder questions, about what’s going on in our companies.

In your companies.

In my view, we are also opening up a promising area of research into the linkages between mental health and workforce productivity in Canada. We must work harder here as well.

So what am I really asking of you – of us, as HR leaders?

First, we all need to pause and consider. Then deal strategically with the fact that there is still a significant stigma in the workplace around mental health issues of any kind. And this is a "natural" stigma. What I mean by natural, is the tendency to stigmatize is latent within everyone. When your job is to be effective and your opportunity for increased pay and promotion is about that effectiveness, to come forward and say, I’m not effective because of an issue you can’t see or touch – that’s not helping your career. In fact it’s doing exactly the opposite. So there’s a very personal aversion to doing this and that’s normal.

The challenge is you need people to present themselves. You can’t remediate something if you don’t know about it.

And so, if you are an HR leader, you need to take action strategically, organizationally, to help people feel comfortable coming forward so they don’t experience adverse reactions.

And the irony is that the only way some people can increase productivity is by acknowledging they might have to decrease it in the short term.

Second, you owe it to yourself and your business to dive deeper into the issues in your workforce by getting better company-specific data. I can’t emphasize this enough.

I’ve made a point of belabouring why good data matters. This is harder than it looks. Otherwise we’d all be doing it better.

And we’re not. Or not well enough.

Every workforce is different and our data supports that. You have a company-specific imperative to understand your situation at the micro-level, not just in aggregate.

You need to ask, what sources of data can I rely on? Here too, every company is different.

Some do regular drug testing. Others have robust workplace safety protocols and reporting.

Some have tracking in the HR function on all kinds of people factors.

The related problem is that most data collected today sits on the shelf. The analytics around that data is not something we are spending enough on. It’s time to change that. If we are not being creative in getting and analyzing data about our people, then we are not really trying to get at the issue of workplace productivity. And I am here to tell you, you don’t know about the mental health of your employees.

Third, it’s incumbent upon you to start and intensify the dialogue with your key leaders around what the data is showing.

The C-suite. Your leadership group. They need to start seeing better data and understanding it. And this is not something that can happen in an hour-long meeting. This is a dynamic process that, over time, involves moving new metrics onto your dashboard. Because that takes time.

The problem for every CEO or CFO is, if someone comes into your office and suggests a full-time resource to look at mental health – what’s your first impulse? It’s going to cost $150K all in.

And what do I get for that, really?

You don’t have to change absenteeism very much to make an impact in your business.

We’ve already seen an important change in the management of employee benefits. Costs are rising faster than inflation because drug costs are rising faster. So every organization needs to look at the data there better. What’s causing drug costs to go up in your workforce? What drugs are people using? Can you move some people from the brand to the generic drug? We’ve seen our clients take on this ongoing challenge.

But mental health is tougher. You can’t really begin to unpack this problem without better data.

As the HR leader, you need to be the expert in the room on what’s really going on in the workforce. It’s your role to be the person bringing new solutions to the table, built upon the logic of good data and better analytics.

We’re all tired of the criticism that HR deals in soft issues. If we’re really tired of it, let’s harden things up with better data.

Fourth, you have to believe that remediation works. It really does.

Let’s start by taking a richer view of early intervention.

We need to encourage the people who are suffering from stress and anxiety – who are troubled and not talking about it – to come forward and get help as early as possible.

For the managers in your business, you need to intervene earlier here too. Be more proactive with manager training to scale your efforts at removing stigma.

In Professor Stuart’s research, she concludes that most supervisors in Canadian businesses have not received sufficient training to be competent in managing workplace stress.

Finally, at the enterprise or leadership level, you can apply data and analytics for a different form of early intervention.

You can identify where people are suffering.

You can see where problems are taking shape.

You can see where your people strategies are working – or not.

Professor Stuart points us in the right direction. "Above all, you need to include mental health as a priority for occupational health and safety within the workplace. You need to remove the structural inequities in the way mental health is viewed organizationally."

And here, we all need to think carefully about Canada’s new voluntary standards on workplace mental health and safety that came out earlier this year. I can say we were proud to have had our experts participate in this multi-stakeholder initiative. And we have high hopes for its widespread adoption.

Is this new standard becoming a reality in your company?

What are you doing – or not doing – to make it so.

In closing, I want to briefly refer to the larger idea of Canada as a miracle of a country.

Could we have imagined, two generations ago, living in cities as multicultural and dynamic as Toronto or Montreal are today? Cities that produce globally competitive goods and services.

These cities would have been largely unimaginable to people of that time.

But even a miracle needs nurturing.

And now that we have this globally diverse workforce, which will help us address and reconcile the challenges of globalization, we need to make it work better – right?

The reality is some things go on in the workplace that we still just don’t understand. There are tensions we don’t often visibly see or hear about enough. And that’s because, maybe, people don’t want to admit to them. And that goes for us, as leaders, too. We all know there are challenges that are uncomfortable to discuss and can be detrimental if we don’t find ways to deal with them.

When it comes to mental health and productivity – let’s deal with it.

Nobody else in the world has cracked that nut – yet.

Why can’t we be a leader in Canada?

And if we recognize that, and act on that opportunity, it’s just one more lever to keep the miracle of Canada alive and well.

Thank you.