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Your Employees Are Present, but Are They Really There? The Problem of Presenteeism

There’s nothing more frustrating than being down a few team members, right? When employees are absent, it seems like you just can’t get as much done, and you’re left scrambling to fill the void. But is absenteeism really the worst thing for your business’ productivity and bottom line? Turns out, it might not be. In fact, the problem of “presenteeism,” or being at work but not being really all there, might be a much bigger problem. So what is presenteeism, and is there a way to combat it and get your employees and your business back on track?

What Is Presenteeism?

Let’s start by taking a look at what we mean when we use the words “absent,” “absenteeism,” and “presenteeism.” silhouette of a person with a question mark next to the head

Absent: This simply means that an employee hasn’t come to work for an important reason, like illness, family issues, vacation, or jury duty. There shouldn’t be any problem with taking days off if needed; this time is extremely necessary for employee productivity.
Absenteeism – Taking days off is one thing, but it becomes absenteeism if it is habitual. If this is happening, you’ll need to look at the cause and try to address it: something like burnout, harassment, mental health issues, or a difficult situation at home could be causing the problem. In general, 1.5% is a very good rate for absenteeism; a higher rate can indicate an issue.
Presenteeism – Some employees will take time off when needed, and others won’t, which can lead to presenteeism, or situations when employees come to work but are unproductive on the job or not working at their full capacity. This can be caused by many things, including:
- Illness/mental illness/chronic diseases (this is generally agreed upon to be the most common, and so most problematic, cause of presenteeism)
- Burnout
- Harassment
- Demotivation
- Problems within a team/conflicts
- Time management issues
- Stress

Coming to work and “powering through” under these conditions doesn’t do anyone any favors: your employee will suffer, and so will your business. But what price is your business paying for this phenomenon?

How Big of a Problem Is Presenteeism?

Now that we’ve laid out what presenteeism actually means, let’s look at its devastating effect on productivity, and your bottom line. Consider this:

According to a GCC Insights report by Global Corporate Challenge (GCC) from 2016, while employees were absent from work an average of 4 days per year each, they confessed to being unproductive on the job for 57.5 days each, or almost 3 working months.
Absent workers cost employers around $150 billion per year, but those who come to work but are not fully present around $1,500 billion per year in the US, based on Bureau of Labor (BLS) data
The Journal of the American Medical Association has reported that depression sets U.S. employers back some $35 billion a year in reduced performance at work, and that pain conditions such as arthritis, headaches, and back problems cost nearly $47 billion. Not only that, but the researchers also found that the on-the-job productivity loss resulting from depression and pain was roughly three times greater than the absence-related productivity loss attributed to these conditions.
When it comes to healthcare costs for employees, studies have shown that only around 30% is attributed to direct medical care and pharmaceutical costs, usually in the form of premiums an employer pays to an insurer. Another 9% is associated with short- and long-term disability and worker’s compensation. Just 6% is the result of absenteeism. The overwhelming majority of the cost – a whopping 60% – is attributed to health-related lost productivity caused by presenteeism. That means presenteeism costs employers two to three times more than direct medical care.
According to one study, 69% of respondents reported going to work while sick at least once in the past year. Workers who did go to work while sick estimated that their productivity was reduced by 23%.

These numbers should worry you, and should make you wonder what exactly is going on. Why are employees at work, but not all there?

What’s Happening?

So what’s going on here? Being absent is clearly not a problem in our workplaces. After all, according to the BLS, the 2018 US annual average absence rate is 2.9%, and some studies show that the median worker takes only one absence day per year, while workers in the 90th percentile take 7 absences per year. But this might be part of the problem: workers are not taking enough time off. Why are they showing up, and not working to their potential? It could be down to multiple reasons, including:

Little to no paid sick days being offered to them
Job insecurity
Understaffing
Unrealistic expectations from their employer
Time pressure
Harassment for taking a sick leave
Huge workload

Take a good look at the issues above, and consider if your employees might be feeling pressure to come to work, even if they’re not at their best, or if they’re forgoing things that are necessary to their mental health and work/life balance, like taking vacations. As we think about that, let’s now take a look at what can be done to help combat presenteeism.

What Can You Do?

Presenteeism can obviously be harder to spot than absenteeism: you know when someone doesn’t show up for work, but you often can’t tell when or how much something going on under the surface, like mental or physical illness or stress, is hindering someone’s performance. But there are things you can do to try to combat presenteeism, and both make life better for your employees and do a favor for your business’ finances.

Recognize the problem

Now you know that presenteeism could be a problem in your workplace, so it’s time to be on the lookout for it. While it can be hard to spot, as we pointed out, it doesn’t have to be. According to Dr. David Batman, GCC’s chief medical officer, and a registered consultant specialist in occupational health with expertise in psychological health at work, employers need to be more tuned into the well-being of their employees:

“I preach a simple message – pay attention if you notice something has changed. Employees at all levels of a business may be stressed, distracted, and struggling to perform at work. As a result, they may be fatigued and this can affect their concentration. So if employees’ engagement with their job decreases or they seem unconcerned about outcomes, you may have a problem – and you will need to act.”

Be clear that it’s ok to take time off

We need to change the conversation, and start prioritizing both under-performance issues and employee wel-lbeing over absenteeism. In the past, it was believed that productivity was connected to attendance, and still today, visibility is related to productivity and efficiency, so employees feel like they need to prove themselves just by being there.

But as Dr. Batman points out, “We need to stop talking about how many sick days people are taking and focus our energy on what they’re doing when they’re actually at work.” And that means giving them the time they need to recover, and doing the following: an empty office

Don’t have a disciplinary policy related to absenteeism. This will only encourage employees to work when they’re not up to it.
Set a good example, and take time off when you need it.
If you notice someone is unwell, or if they are not themselves, send them home or even let them work from home for a while if that’s best.
Do your absolute best to offer adequate paid time off and/or sick leave.
Consider offering a workplace wellness program.
Make sure you have enough staff to cover an employee if they can’t be at work, otherwise they might feel pressured to always be there.
Reduce the stigma around mental health issues in your workplace, and make clear that you prioritize their mental well-being by offering them time off and coverage for mental health treatments.

Presenteeism is not about workers pretending to be sick to get out of work, or fooling around on the job and not getting things done, it’s a problem in our culture that values attendance over wellbeing. Hey, no one likes working when they’re sick, stressed, or overwhelmed, right? And the numbers prove that not only do people not like it, but it’s bad for their productivity, and for your bottom line. So it’s time to focus on creating a workplace that’s healthy for employees’ bodies and minds, so you can achieve your goals and keep your employees happy and motivated.

The Pareto Principle: How the 80/20 Rule Can Help Your Business

Do you ever feel like you’re trying to do it all, and do you then find yourself questioning whether it’s really worth it to put 100% of your time and energy into every single little thing for your business? Well, you should be questioning it: not only can that intense multitasking mindset lead to burnout, it also doesn’t necessarily yield greater results, in life or in business. If you’re feeling skeptical about that, don’t take our word for it; check out a theory put forward by an Italian economist over 100 years ago, and reintroduced in the 1940s: the Pareto Principle, which you might have heard of as the 80/20 rule. This rule, simply put, states that 80% of effects come from 20% of causes – and, although it’s not a concrete law set in stone, it does seem eerily correct a lot of the time. So what does it mean, and how can you use it to help grow your business?

The History of the 80/20 Rule

peas in a pod — *Italian economist Vilfredo Pareto, creator of the Pareto Principle, noticed that 20% of his pea pods produced 80% of his peas.*

While the term “Pareto Principle” was coined in the 1940s, the principle itself was devised by Italian economist Vilfredo Pareto back in 1906. Legend has it, though, that it wasn’t economic data that got him thinking about the 80/20 rule. As the story goes, Pareto, an avid gardener with an inquisitive mind, noticed that 20% of his pea pods produced 80% of his peas, which got him to thinking: could this be a general rule in the world, and could it be applied to economics?

Pareto looked into it, and it turns out that this rule did apply elsewhere: for example, he found that 80% of the land in Italy was owned by 20% of the population; not only that, but, surprisingly, this was true in most other countries and regions as well, which led him to create the theory of “the vital few and the trivial many.” Fast forward to the 1940s, and Dr. Joseph Juran, a quality management expert, came across Pareto’s theory and tested it to see if he could apply it to QA. When he found that 20% of defects generally cause 80% of problems for most products, he recommended that QA teams focus their energy on the most important 20% of issues, which not only led to better outcomes, but skyrocketed efficiency. And so the Pareto Principle, or the 80/20 rule, was born!

The Surprising Number of Applications

While it’s important to remember that the Pareto Principle is a principle, or a trend, and not a magic trick or an unchangeable universal law, it is almost astonishing how many areas this theory applies to. For example, there are some interesting general applications, like:

80% of the shoes owned by a group of people are individually owned by 20% of those people.
80% of crimes are committed by 20% of the criminals.
20% of the healthcare patients in the United States use 80% of the healthcare resources.
Software engineers spend 80% of their time on 20% of the software’s features.

But there are also many, many ways the Pareto Principle applies to the business world, including:

20% of salespeople make 80% of sales
20% of people at a company earn 80% of the profits
20% of your customers make up 80% of your sales
20% of your sales come from 80% of your products
80% of customer complaints come from 20% of customers
80% of customer complaints are also related to 20% of your products/services
80% of traffic lands on 20% of your website pages
80% of your social sharing comes from 20% of your social updates
20% of the hazards in a workplace cause 80% of the injuries
20% of your time and efforts can produce 80% of your results

How to Apply the Principle to Your Business

black clock on a table — *The 80/20 rule can help raise productivity without multitasking.*

The last point above, that 20% of your time and efforts generally produce 80% of your results, is probably one of the most famous and universally useful findings of the Pareto Principle, and it should be yet another big clue that multitasking just isn’t worth it. In fact, some studies have even shown that multitasking can reduce productivity by as much as 40%!

Focusing on the 80/20 rule will help you stop trying to do everything at once, and remind you to direct your time, energy, and money to the things that produce the highest results with the most efficient use of your resources. In other words, the more you narrow down your efforts to the most important tasks, the better your output will be. As bestselling author Ken Kruse points out, “In my research into the productivity habits of high achievers…[I found that] handling every task that gets thrown their way – or even every task that they would like to handle – is impossible. They use Pareto to help them determine what is of vital importance. Then, they delegate the rest, or simply let it go.”

So, using the general 80/20 rule about time and effort is a powerful way to help you and everyone involved in your business focus on what matters most – but how specifically can you do that? Let’s go back and look at a few of the other applications from above and how you can make them work for you:

80% of your profits come from 20% of your customers – Take a look and see if this holds true for your business. If it does, you’ll need to find ways to hold onto those very important customers, and get more of them. You should also be aware that, according to the Pareto Principle, not only will 80% of your sales come from 20% of your customers, but 20% of your customers are also more likely to spend 4 times more than the other 80%, so it’s very important that you identify these big spenders! To determine who your star 20% is:

- - Identify who has bought recently, who buys the most frequently, and who spends the most
  - Figure out how your core 20% found you – for example, which ads did they convert on and which content did they engage with – and make sure to enhance and promote all of it!
  - Get to know your 20% as best you can, perhaps by performing a demographic study, so you can continue to target them.

80% of your sales come from 20% of your products – Take a look at your sales figures: is this true for you? If so, don’t just rely on these bestsellers to sell themselves while you try to prop up your less popular products; work to enhance, advertise, promote, and push the more popular products so you can really make the most of them. In addition, you might even find that some of the 80% of products or services that aren’t selling as well aren’t worth your time, meaning you could discontinue them and actually end up growing your business in other ways by focusing on the more important things. Again, the Pareto Principle is sometimes about letting go!

80% of traffic lands on 20% of your website pages – The 20% of pages that get the most views are probably your most important pages – the ones that include vital information on your products or services and the purchasing process. Keeping the 80/20 rule in mind, analyze how traffic flows to your website, and optimize your site so that it is as straightforward as possible for viewers to access your critical pages. Doing so will increase sales, as well as allow your business to grow at a faster rate with less traffic.

80% of customer complaints are related to 20% of your products/services – Customer service is one of the key components of your business, right? There’s almost nothing more important than keeping your customers satisfied, so if you can use Pareto to determine which of your products or services are causing the majority of the problems, you have a better chance of solving customer service issues for good. You can also use the 80/20 rule to figure out which of your customer service staff is associated with the most complaints, so you can focus on how your staff needs to change their interactions with customers.

80% of your social sharing comes from 20% of your social updates – Where are all those likes and retweets coming from? Probably from only around 20% of your social media posts, so use a social analytics tracker to find out which are your best-performing updates, then think about what they all have in common so you can replicate that for your other posts!

The above are just a few of the many ways you can apply the Pareto Principle to your business, and see your profits soar as you become more efficient, and learn how to determine which aspects of your business are not performing to their full potential, and how to let go of what’s not so important. Just remember, the 80/20 rule is not a hard-and-fast law, but it is a powerful tool to help you refocus your energies and get the most results from your efforts. That being said, though, more likely than not, you will find it applies in an amazing number of situations, and using it can have a profound impact on reaching your goals.

How to Boost Your Employees’ Productivity Levels

As a small business owner, there are many things about your business that are in your control, and some that aren’t. How would you classify your employees’ productivity levels – as something you have control over? Or do you often feel like you’re at the mercy of outside forces when it comes to your employees working up to their potentials? It doesn’t have to be that way! And it doesn’t require raises or big gifts to get your employees producing more, higher quality work. All it takes is some good old fashioned people management skills, which we know you’ve got in spades!

What’s Holding Your Employees Back?

One important thing to remember is that employee productivity is not just about quantity, it’s also about quality. But before you can find that sweet spot of employees producing a lot of high quality work, you have to understand that many people these days can feel distracted and unmotivated at work. That’s understandable: we’re living (and working) in a world that is constantly connected and filled with distractions. Even the ability to have meetings anytime, anywhere can be an issue when it comes to productivity. In addition, many people now spend more time working than they do sleeping, making for a frustrating lack of work-life balance.Think about the following stats:

70% of workers admit to feeling distracted while working, with 16% saying they’re almost always distracted
The average employee is interrupted from their work 56 times a day, and spends an average of two hours a day recovering from interruptions!
60% of workers say they view meetings as another interruption to their day

66% of people say they would be better, more productive employees if they got more sleep

1 million workers miss work each day due to stress, with 31% feeling high levels of stress at work

61% of workers report being burnt out at their job

40% of employees say they would put more effort into their work if that effort was recognized more often

89% of workers prefer to work alone to hit their maximum productivity

Happy people are 12% more productive
Employees who feel that their voice is heard at work are 4.6 times more likely to perform at their best
A highly engaged workforce is likely to outperform companies with less engaged workforces by 202%!

The above numbers might be eye-opening. It seems that employees are more likely to be distracted or stressed than they are to be engaged and feel heard – and that could be a huge problem for your business. But consider the positive numbers above, and know that there are ways to get your employees happier, more empowered, and more engaged so that you can see your productivity levels soar.

What It Means to Be Productive – and How to Get There

What does productivity mean in terms of your business? There are three criteria your team should be meeting:

They get their work through all their work, generally meet all their deadlines, and don’t spend too much time on any one task.
You are pleased with the quality of their work – it should at least meet, if not exceed, your expectations.
Their time and efforts are spent in the right way, and not wasted on the little things.

young african american woman smiling with a laptop in front of her. — *Make your employees feel respected and heard in order to boost productivity levels.*

To get your team to this point, try the following strategies:

Make sure employees feel respected and understood – You need to understand your employees in more ways than one. Of course, you need to know their skill sets and match them to their tasks in order for them to be as productive as possible, but you also need to understand their motivations – what brings them to work everyday and what they need to feel supported. Let them know you see them, and that you respect their work and have their backs, no matter what.

Set clear, focused goals and expectations – Your employees can’t be efficient if they’re not working toward a clear goal. And not only do goals need to be clearly defined, they also need to be achievable in order for your employees to stay on track and be productive. Try the S.M.A.R.T. goals method: set goals that are specific, measurable, attainable, realistic, and timely, and you’ll see an increase in focus and efficiency.

In addition, it’s important to remember that all tasks should be as clearly and narrowly defined as possible for your team so that you don’t lose time on the little things. For example, you might think it goes without saying that you want everyone to proofread their work, but they might assume that you’re going to do it because you’ve asked for final review of the project. Always be clear about what’s important to you.

Cut back on the extras – On the other hand, if there are things that aren’t so important to you, try to trim that excess work back, so your employees can focus on higher priority tasks. Look at any tasks that they do as a mere formality and see if they can’t be scaled down or eliminated all together. Daily reports, for example, can be streamlined, or the number of people they need to get approval from for certain tasks could be reduced.

Stop micromanaging – We get it, your business is your baby, but if you have trouble delegating and being a coach on the sidelines sometimes, you’re going to end up with lower productivity, despite your best efforts to stay on top of every little thing. You’ll end up stifling your employees and hurting morale, and, not only that, but you’ll end up being less productive. You can’t be effective in your role as leader if you’re so involved in everyone else’s job; you’ll just end up creating a bottleneck and slowing everyone down.

Listen, listen, listen! – There’s more to managing your team than sending explanatory emails or giving a talk before they embark on a new task. Listening is incredibly important, too! Remember, your employees are often the ones on the frontlines, and they will have valuable input about improving day-to-day issues. And not only will you get good ideas about how to make things run more efficiently, but your employees will also feel like they are truly part of the team, and are actively contributing to the company. This will make them more engaged and, ultimately, more productive.
When you do conduct a meeting, make sure it is as productive as possible.

Think about how you communicate – According to a McKinsey study, emails can take up nearly 28% of an employee’s time. In fact, email was revealed to be the second most time-consuming activity for workers (after their job-specific tasks). Think about whether you’re matching the communication with the method. Instead of an hours or days-long back and forth for some things, try a quick phone call or meeting. But…

Have more productive meetings – Remember, meetings can also be a major productivity killer. Think about this: most meetings last 30 – 60 minutes, and most employees say that at least a third of those meetings feel like wasted time. That’s 10 -20 minutes a meeting, 20 – 40 minutes a week if you hold just two meetings, and 1,000 – 2,000 hours a year! We understand, meetings are important, just make sure:

- - You REALLY need to meet in person (or over Zoom)
  - There is a clear agenda
  - You invite only team members who really need to attend
  - To keep it short
  - To have clear next steps

Celebrate successes – Nothing motivates employees like a genuine, heartfelt “thank you” for all the work that they do, and true appreciation for the things they achieve, all in the name of your business. You can choose to say thank you however you’d like, including:

- Praising them both publicly and privately
- Rewarding them monetarily, whether it be with a gift card or a bonus
- Rewarding them with a non-monetary treat, like half-day Fridays, “lazy Mondays,” or more PTO
- Donating to a charity of their choice
- Sending hand-written notes
- Implementing a wellness program as a thank you to the whole team, and as a way to keep them healthy, happy, and incentivized

You can get creative with your thank you’s – just don’t forget to offer them!

Train and retrain – One place where you shouldn’t skimp on the extra time, effort, and money? Training and retraining your employees. Instead of throwing employees into their job to learn as they go (which will only end up with you having to go back and spend extra time correcting mistakes and reiterating what you want from them – remember those clear expectations?), take that extra day or two to get them fully up to speed. Not only will they be more efficient employees, but by improving their skills and knowledge, they will also become more confident, more effective, and more engaged.

Don’t forget to create employee development plans, allow them to retrain and learn new skills, and then offer them situations in which they can use their new knowledge. You’ll show them that you care about their future, which will go a long way towards making them feel respected and understood. It’s all connected!

Ultimately, it all comes down to the environment you create for your workforce. Whether they’re working remotely or you’re seeing them face-to-face each day, you’ve got to be there to have their backs and set the tone of their workplace. Treat your employees as valued individuals and give them the training they need and achievable, meaningful goals and you’ll be on your way to some seriously increased productivity.

As Anne M. Mulcahy, Former CEO of Xerox Corporation said, “Employees who believe that management is concerned about them as a whole person – not just an employee – are more productive, more satisfied, more fulfilled. Satisfied employees mean satisfied customers, which leads to profitability.”

Keep Your Employees Healthy & Happy With EZ

Did you know that 56% of employees would prefer health insurance over an increase in pay? Offering health insurance also means recruiting the best candidate for a job – most job seekers will not look twice at a posting if an employer does not offer health insurance. Having the right benefits plays a big role in your employees’ job satisfaction and productivity. Your employees will feel more valued, and will be able to stay healthier when they are insured. A healthcare plan is a small price to pay for the success of your business.

Healthy Employees = Happy Employees = Productive Employees

Studies show that small business health insurance plans increase employee loyalty and decrease turnover. There’s scientific proof that purchasing insurance for your employees can increase retention and aid in recruitment of new employees.

Employees who aren’t provided health insurance are more likely to avoid seeking medical attention when they are sick, and less likely to go to the doctor for routine preventative care. In short, they are at greater risk of being unhealthy. When you offer health insurance, you offer your employees an opportunity to remain healthy and happy. And when employees are healthy and happy they are more likely to come to work and not call out sick. According to a Willis survey, 93% of employers say that healthier employees are more productive employees.

Workplace Wellness Programs

One way to make sure that your employees remain healthy is by offering a workplace wellness program as part of your healthcare plan. These programs give incentives for employees to meet their health goals, like quitting smoking, or getting more exercise. Encouraging even small changes in employees’ lifestyles can make a big difference in productivity. In fact, one survey found that employees who eat healthy are 25% more likely to have higher job performance. Your wellness program can also include perks like discounts on gym memberships, which can go a long way in not only promoting better health, but also greater job satisfaction.

The Cost

piggy bank with little characters carrying money and handing it off to the next until it reaches the piggy bank. — *You can still save money while offering insurance to your employees.*

Happiness is not cheap. Group health insurance can be costly, but the trade-off is a healthier, more productive workforce and less employee turnover, which can save you money in the long run. And remember, the more employees you have, and the more employees that participate in your health plan (offering perks can help with that!), the lower the cost of providing benefits. When you have a lot of employees in a pool, there are more options available at a lower price.

You also save money with the tax benefits of offering group health insurance:

Employer contributions are tax-deductible
Employer payroll taxes are reduced by 7.65% of employee contributions
Employer workers compensation premiums are reduced

We get that trying to find a group insurance plan for your employees isn’t easy. There are a lot of different plans to choose from and you may not be sure which benefits you should offer your employees. One way to help you figure it all out is to have your employees complete a health insurance survey. After obtaining the results of the survey and deciding which direction you want to go in, come to EZ.Insure. We will make the process easy and pain-free. You will be provided with a highly trained agent who will compare all available plans and help you decide which plan is best for your business. To get free quotes on plan, enter your zip code in the bar above, or to speak with an agent, call 888-998-2027.

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