Workplace injury costs can quietly siphon resources from small business owners. Not only can they pose significant financial threats to the health of your business, but the long-term cost of workplace injuries can lower morale and productivity, NEXT reports.
2023 data from the National Safety Council placed the cost of workplace injuries at $176.5 billion, or about $1,080 per worker, and $43,000 per medically-consulted injury. That same report also found 103,000,000 days of lost work from work injuries sustained that same year.
Occupational injuries can impose significant financial burdens on small businesses, encompassing direct, indirect, and long-term expenses.
Direct costs are immediate expenses your business incurs right after an employee injury occurs. These can include:
Indirect costs reflect some of the hidden, secondary expenses that often accumulate after a workplace accident. These can include:
Long-term costs capture the ongoing financial impact of workplace injuries, potentially hindering your business growth into the future. Some of these long-tail costs include:
These costs can be particularly devastating for small businesses operating on tight margins. Implementing proactive safety measures and fostering a workplace safety culture is essential to mitigate these expenses.
If you want to see what workplace injury costs would look like for your business, OSHA’s Individual Injury Estimator can help you see some specific numbers.
According to data from the U.S. Bureau of Labor Statistics, the most frequent workplace injuries that result in time away from work include:
Proactively addressing these injury types through prevention strategies can significantly reduce workplace injuries and associated costs.
Not every workplace risk is immediately evident. These subtle dangers are just a few that can often be overlooked:
Mental health and workplace stress
Workplace stress can significantly impact employee well-being and productivity.
According to an American Psychological Association survey, 54% of U.S. workers cited job insecurity as a major stress factor. And 39% expressed concern about potential job loss within the next year due to changes in government policies. Financial stress compounds these issues, costing U.S. employers around $183 billion annually.
Ergonomic issues and remote work
Many small businesses overlook ergonomic setups for remote workers, which can lead to repetitive strain injuries and back pain. The Occupational Safety and Health Administration (OSHA) notes that ergonomic disorders are among the most frequently reported workplace injuries.
Inadequate safety training
Small businesses sometimes skip or minimize safety training due to limited resources or time constraints. However, insufficient training can increase injury risks and may result in regulatory penalties or legal costs if an incident occurs.
Small businesses can significantly reduce the costs of occupational injuries with practical, proactive prevention strategies. Some best practices that could help improve safety for your workers include:
Regular safety audits
Routine inspections can significantly reduce workplace injuries by identifying potential hazards before they become serious issues.
Employee safety training
Implementing a health and safety program could result in as much as a 20% (or more) reduction in injury and sickness rates, with a return of $4-$6 for every $1 invested. To better train your team:
Ergonomic workspaces
Create an ergonomic workplace to help reduce injuries, boost productivity and increase employee satisfaction.
Clear communication and reporting
Open and effective communication can help identify risks early and prevent accidents.
Business insurance is essential to help your business manage workplace injury risks and costs. Here’s how different types of insurance that can help protect your small business:
Workers’ Compensation insurance
Workers’ compensation insurance is usually required if you have employees. But even if it’s not, it can help protect your business from the costs of medical treatment, rehab costs, and lost wages when employees suffer a work-related illness or injury.
For employers, workers’ comp also offers some legal protection. This type of coverage typically includes some protection from work-related injury employee lawsuits to help reduce legal liabilities and associated costs.
For instance, if a customer slips and falls on your premises, a general liability insurance policy could help cover medical costs and legal expenses so you aren’t footing the bill alone.**
Commercial Auto Insurance
Commercial auto insurance can help protect businesses from liabilities after accidents or damage caused by company-owned vehicles.
Motor vehicle accidents during work-related activities — such as deliveries, driving to business meetings, or running job-related errands — can be considered workplace injuries.
