Stress out?

A study of trends in workplace stress across the globe

A global report from Regus

November 2009

Management Summary Over half of the global business population (53.8%) have experienced an appreciable rise in their workplace stress over the last two years More than one fifth of business people internationally have experienced a severe rise in workplace stress over the same period The rise in overall workplace stress is greatest in China (85.9%) as the dragon continues to grow rapidly Belgium, Mexico, South Africa, Spain, the USA and India are on or near the average for appreciable increase in workplace stress. Slightly under-average are France, Australia and Canada. The lowest increase in workplace stress is reported in the UK, Germany and the Netherlands. However, when it comes to business people experiencing the most severe increase in workplace stress, the USA comes top of the table (35%) France records the lowest proportion of business people experiencing a severe increase in workplace stress (10.6%) Internationally, the most cited cause of workplace stress is increased focus on profitability, typically where employees are expected to take on additional tasks and responsibilities, often without additional reward There is a clear correlation between increases in workplace stress and the likelihood of key employees leaving something that businesses worldwide want to avoid as they struggle to either return to growth (mature economies) or accelerate growth (emerging economies) Various studies have demonstrated that flexible working arrangements, where employees can work outside of normal hours, or where they spend part of their time working from home, reduce employee stress, improve productivity and save corporations money Whereas downsizing, plus increased productivity and profitability pressures cannot be reversed, working practices and workplace solutions can be changed in order to reduce employee stress and improve retention of key personnel

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Introduction Technically, most world economies are now out of recession. However, the end of quarter-onquarter decline in output does not signal a full economic recovery. Expert commentators have firmly noted that basic economic indicators, such as GDP trends, tend only to be forward indicators of economic movements that often take a further 6-12 months to become firmly established1. Regus own twice-yearly global survey of economic health recently found that most major world economies do not expect the pace of recovery to have gained reliable momentum until the summer of 20102.

For company employees and managers, this means that stressful challenges still lie ahead for some period of time before the momentum of recovery has really taken hold. Stress in the workforce can provide companies with real problems. Management and work productivity can be seriously impaired. Motivation levels may be damaged. Conflict between colleagues becomes more likely as self-control and professionalism is undermined. All of which leads to companies not operating at their optimum efficiency and effectiveness. This in turn leads to damage to bottom-line commercial and financial results, something that firms are desperate to avoid just at a time when they are fighting to return to significant growth in a challenging marketplace.

In emerging economies and regions, where the global slowdown has not resulted in decline but simply a slowing of growth, the damage that increased stress levels can cause is just as important. Rapidly expanding economies often experience skills shortages, and therefore cannot ignore the clear connection between stress, job dissatisfaction, and likelihood of defection to another, less stressful, work environment. Again, the last thing that companies in countries such as China and India wish for is the loss of key skilled staff, impairing the ability to ride the growing wave of economic development.

In extreme cases, stress can cause very substantial damage to the workforce. In France, France Tlcom has experienced a spate of suicides, in the latest case when a worker died after throwing herself from the fifth-floor window of company premises in Paris following news of further corporate reorganisation. The suicide, the 23rd among staff at the company in the previous year and a half, triggered a media storm of concerns over stress at work. The
1 2

See, for instance, Financial Times, Indian companies expect early recovery, 20 October 2009 Regus, Recovery and Renewal, October 2009

th

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companys chairman met with the Employment Minister and there was a form of positive outcome from these tragedies as moves to provide better support to employees during restructuring exercises were stepped up at companies throughout France.

Workplace Stress around the World In fact, there has been widespread recognition of the cost of stress across the globe. According to the American Institute of Stress, 80% of workers feel stress on the job, nearly half say they need help in learning how to manage stress, and 42% say their co-workers need such help.

In Australia, a recent report has found that workplace stress is costing the Australian economy $14.2 billion, and Australian workers miss an average 3.2 working days a year because they are too stressed to function3.

The Canadian Mental Health Authority found that workers are 30% more stressed this year than they were last year. To tackle the rising incidence of workplace stress, employees need to take responsibility by talking with their employers when they see potential problems arising; maintaining their health; and focusing on their accomplishments and goals, states the CMHA4.

A study by the Indian Council for Research on International Economic Relations found that Indias rapid economic expansion has boosted corporate profits and employee incomes, but has also sparked a surge in workplace stress and lifestyle diseases that few Indian companies have addressed.

A study by insurance company DAK recently found that about 800,000 German workers regularly take stimulants in order to enhance their performance on the job. The recession and its consequent workplace stress have taken a severe toll on the German workforce: In 2008, the numbers of stress-related casualties in the workplace shot up. The number of sick days employees took off from work increased by nearly eight percent from the previous year5.

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Herald Sun, Cost of workplace stress hits 14.2 billion, 2008 CBC News, Stress levels up in Canada, 4 May 2009 5 DW World, Pill-popping for work stress endemic in Germany, 13 Feb 2009

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According to Belgiums Directorate for the Study into the Improvement of Working Conditions, nine psychosocial risks are mainly responsible for stress at work: high work pace; emotional workload; under-utilisation of skills; doing monotonous work; lack of social support from colleagues; lack of autonomy; lack of participation in decision making; role conflict; and lack of role distinction6.

The Hudson Report, a quarterly survey of hiring expectations, found that workers in China feel more work-related stress than their counterparts in other Asian economies. 36% blamed their stress on increased volumes of work, which marked the most significant stress-causing factor in the survey. Zhu Qingyang, secretary-general of the Shanghai Human Resources Consulting Association, said: What insiders have found is that many companies can't find qualified talent. Many young students didn't meet the standard for a professional career person.7

According to a survey by the WageIndicator Foundation, workers in South Africa are, on average, more physically tired as a result of their jobs than in any other country (11 surveyed). When it comes to mental exhaustion, South Africans rank second only to Spain8. The WageIndicator Foundations survey also found that wage levels caused significant stress for Mexicans: 79% of Mexicans said they were not paid for exceeding working hours, compared with 69% of Spaniards, 67% of Argentineans and 54% of Britons9.

Finally, an annual survey on workplace stress in the UK has found that: 53% of HR professionals consider stress to be more of a problem than it was a year ago; 33% of organisations have a policy in place for managing workplace stress, down from 35% the previous year; and 12% of firms had been forced to dismiss staff signed off with stress in the past year.10 That stress causes actual operational damage has now been corroborated by one of the UKs leading independent bodies. The National Institute for Health and Clinical Excellence (NICE) said 13.7 million working days are lost each year as a result of work-related mental illness. This leaves UK employers with a total bill for lost productivity of 28.3 billion a year11.

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European Working Conditions Observatory, Night work and shift work cause high stress levels Hudson Recruitment, Hudson Report, 2008 8 WageIndicator Foundation, Global Survey, Oct 2008 9 Ibid 10 HR Magazine, Workplace: Stress survey 2008, 1 April 2008 11 NICE, Promoting mental wellbeing at work; economic review, 5 November 2009

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Workplace Stress the New Research Rarely are studies into workplace stress conducted on a consistent basis across the world. In order to provide initial insight into how stress levels compare across selected developing and mature economies across the globe, Regus commissioned research amongst its 1 million strong international business contact base. Over 11,000 respondents from thirteen major countries provided their views and recent experience of workplace stress, and the resulting statistics offer a consistent comparative basis for commentators, analysts and business managers interested in the issue12.

In overview, business people were asked whether they had suffered significant increases in workplace stress over the last two years. They were also asked whether that increase had been simply significant, or extreme, as well as the principal causes of this stress.

Overall, appreciable increase in stress affected more than one in every two business people (58.3%) internationally in the last two years. Workplace stress was seen to be greatest in China (85.9%), no doubt on account of the pressures of rapid growth in an economy which, even during the current global slowdown, is still predicted to deliver a GDP increase of over 7% in 2009, and almost 9% in 201013. Significantly below the international average for workplace stress came Canada (51.8%), the UK (48.2%), Germany (47.8%) and the Netherlands (47.3%).

11,000+ respondents; business decision makers; representative sample by company size and sector; 13 countries USA, Canada, Mexico, UK, France, Germany, Netherlands, Belgium, Spain, South Africa, India, China, Australia; research period August to October 2009; online survey; margin of error +/-<1% 13 Source: The World Bank

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Proportion of business people whose stress levels have increased appreciably in the last two years

Average China Belgium Mexico South Africa Spain USA India France Australia Canada UK Germany Netherlands
0% 10% 20% 30% 40%

58.3% 85.9% 64.4% 64.2% 63.3% 58.2% 58.2% 57.1% 55.6% 55.4% 51.8% 48.2% 47.8% 47.3% 50% 60% 70% 80% 90%

However, looking at the people who classify their increase in workplace stress as severe, a very different picture emerges. Overall, one in five business people (22.2%) experienced a severe increase in workplace stress across the last 24 months. China drops into the middle of the rankings, with the USA now clearly at the top of the table for severe increase in stress levels. This may be explained by the fact that the recent financial markets crisis had its origins in the over-inflation of the US sub-prime property market which, when it crashed, had an adverse impact on US overall house values, as well as knock-on effects in the real economy. It should be remembered that the US was one of the few nations to actually allow banks to fail.

Interestingly, a fast-growing economy like India is surprisingly free of more extreme increases in workplace stress (17.5%). The UK and Germany also maintain their position in the lowest three. However, it is France that betrays the greatest sang froid in this measure of radical workplace stress increases a fact that makes the recent spate of suicides at France Telecom that much more worrying. In other words, if this phenomenon is happening in a relatively lower stress economy, then how might matters develop in more high-octane environments such as China, the USA, Spain, Belgium, Mexico or South Africa?

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Proportion of business people who have experienced a more extreme increase in workplace stress over the last two years

Average USA Spain Belgium Netherlands Australia Canada China South Africa Mexico India Germany UK France
0% 5% 10.6% 10% 15% 20% 13.3% 13.1% 17.5% 20.5%

22.2% 35.0% 28.9% 28.2% 27.0% 25.6% 23.3% 22.7% 22.3%

25%

30%

35%

Size of company also seems to have an influence on the level of stress increase experienced in recent years. Broadly speaking, more people in larger companies have experienced a rise in workplace stress, possibly because the potential for downsizing is by definition greater in larger firms. The threat of redundancy will have an influence on how stressful the workplace is, and once the workforce has been pared down, many find themselves with double the responsibilities but without additional reward.

Proportion of business people whose stress levels have increased appreciably in the last two years - by company size
70% 61% 60% 58% 54% 50% 56% 67%

65%

65%

40%

30%

20%

10%

0%

All Sizes Average

1-9 Employees

10-49 Employees

50-249 Employees

250-999 Employees

1000-4999 Employees

5000+ Employees

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Sector variations were also apparent, with the healthcare and pharma industry under greatest stress, and retail showing least growth in stress.
Proportion of business people whose stress levels have increased appreciably in the last two years - by business sector

All Sectors Average

58%

Healthcare and Medicine 61%

65%

Manufacturing and Production

Banking, Finance and Insurance

59%

Media and Marketing 55%

59%

Consultancy and Services

ICT 52%

55%

Retail 0% 10% 20% 30% 40% 50%

60%

70%

The Regus study also investigated respondents opinion on the main causes of stress in the workplace. Again, clear patterns emerge. In every country studied, bar the UK and Mexico, increased focus on profitability was felt to be the main factor increasing stress levels. In the UK, risk of unemployment/business failure was the top stress generator, and in Mexico it was pressure from customers for increased service. This latter factor (customer service pressure) was also nominated as the second greatest generator of stress by six additional countries Germany, Netherlands, China, Spain, Canada and India. Risk of unemployment/business failure was cited in second place by the USA and Australia. Only South Africa cited not enough administrative support in their top two stress factors, reflecting the findings of WageIndicator Foundations survey work mentioned earlier in this paper.

UK

France

Germany

USA

Belgium

Netherlands

Australia

China

Mexico

Spain

Increased focus on profitability Increased focus on quarterly sales revenues Not enough administrative support Aggressive competition from

39.0% 19.1%

39.7% 35.2%

34.8% 29.9%

39.1% 20.0%

37.3% 37.3%

38.9% 13.3%

39.5% 19.6%

42.0% 26.3%

31.0% 31.7%

40.5% 25.1%

25.4% 7.8%

17.1% 8.6%

26.4% 12.9%

24.4% 10.1%

22.5% 3.5%

19.9% 12.3%

27.0% 9.7%

16.3% 14.1%

8.5% 11.4%

10.6% 13.2%

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colleagues Risk of unemployment/busin ess failure Pressure from customers for increased service Loss of good staff 43.7% 21.2% 16.4% 38.1% 12.0% 21.6% 36.4% 17.6% 18.8% 20.7%

32.4% 16.8%

29.4% 6.4%

33.3% 14.9%

25.8% 12.4%

29.6% 4.2%

28.1% 12.3%

32.7% 17.3%

32.9% 18.8%

34.4% 10.3%

26.4% 14.1%

Reasons for Resignation and the Flexible Workplace Why, then, do people leave their jobs. What can be done to overcome points of dissatisfaction in order to retain them? One American business growth specialist has identified a top-10 list (in no particular order) of why people quit their jobs. The top two reasons in this list are: being required to do the work of two or more people; cutbacks on administrative help14. Both of these reasons are intimately connected to the Regus surveys top stress factor increased focus on profitability. We have already noted that the drive for profitability increases stress when companies downsize, then demand that the remaining employees to cover more responsibilities for the same salary, and with less support.

Given that there is a clear correlation between workplace stress and employee defection, and given that organisations are desperate to hold onto their key worker and management skills as they strive to return top growth, what can be done to lessen workplace stress? Clearly, no company in the current climate wants to over-employ, even in emerging economies. Lean staffing levels are an imperative in mature economies seeking a return to growth. In emerging economies, skills shortages demand that staff retention is a priority. Therefore, initiatives must be taken to reduce employee stress. What can be done? What are practicable solutions?

There are a number of ways in which companies can reduce workplace stress. Improvements can be made to the office environment and its on-site facilities; examples might include free massages or a subsidised canteen. Jobs can be redesigned so that people are focused on their forte. This might embrace changing and re-engineering responsibilities, moving people around to more convenient locations, or providing more regular feedback opportunities so that employees can air any grievances before they become too stressful. Flexible working practices can be introduced, such as job sharing, variable start and finish times, or even part-paid career breaks and exchanges with other companies. Work flexibility can also be extended to accommodate maternity/paternity policies or holiday purchase schemes. Finally, and perhaps
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Business Know-How, Top-ten reasons why people quit their jobs, 2008

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most powerfully, a balance may be struck between office work and home work, in order to improve key employees work/life balance.

One of the most significant factors in improving employees job satisfaction is to be able to offer flexibility to work remotely, either in whole or in part. Flexible workplace solutions are now available which allow corporations to offer employees the ability to work partly or entirely from home, or have a hot-desk capability in multiple locations, or call on meeting room or working facilities as needed, or a host of other workplace possibilities. There is currently very keen interest in such flexible solutions, as opposed to rigid commercial property leasehold arrangements, as many companies over the last two years have found themselves facing diminishing revenues and a smaller workforce, but no ability to flex their office cost commitments. Equally, as commercial recovery gains momentum, firms are now looking for flexible solutions that allow them to grow very rapidly, especially in emerging economies.

The benefits of flexible workplace solutions are manifold, according to one pundit, who stated that: Virtual office workers are 10 to 20% more productive than they would be in permanent offices.15 Cisco Systems estimates a 25% increase in work productivity among telecommuters. Deloitte estimates a $40 million savings in reduced employee turnover costs And Fortune reports that 84 of the 100 Best Companies to Work For allow employees to telecommute or work from home at least 20% of the time, and many offer a number of other work/life balance programs such as job sharing and compressed workweeks16. No doubt similar anecdotes abound across the world.

15 16

Franklin Becker, director of International Workplace Studies at Cornell University Workforce.com, Workplace flexibility a low cost benefit with high returns, 16 March 2009

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Conclusion This research study has provided a consistently gathered set of statistics on growth in workplace stress through the financial markets crisis and the recent global slowdown. The study offers a selection of representative mature and emerging economies across the globe.

The study shows that over half of the worldwide business population is experiencing a rise in workplace stress, with a fifth of respondents categorising their rise in stress as severe. A number of studies have linked stress to likelihood of key employees leaving something that businesses do not want to happen as they strive either to return to growth (in mature economies) or accelerate growth (in emerging economies).

Offering employees more flexible working arrangements is one proven method of reducing workplace stress and improving employee motivation and retention. Other global Regus research studies corroborate this, revealing that 64% of respondents believed that a major proportion of small businesses will be looking for flexible methods of working over the next three years, and 59% believe that this will also apply to large businesses17.

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Regus, Recovery and Renewal, October 2009

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Methodology 11,007 business present respondents from the Regus global contacts database were interviewed during August and September 2009. The Regus global contacts database of over one million business-people worldwide, is highly representative of senior managers and owners in service businesses across the globe. In this second research project to be publicly issued, respondents were asked about their commute to work and impacts (if any) it had on their personal and business life. The survey was managed and administered by the independent organisation, MarketingUK.

To arrange a briefing regarding this research please contact the Regus Research Team on +44 (0) 1932 796284 or email andrew.brown@regus.com

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About Regus Regus is the worlds largest provider of innovative workspace solutions, with products and services ranging from fully equipped offices to professional meeting rooms, business lounges and the worlds largest network of video communication studios. Regus delivers a new way to work, whether its from home, on the road or from an office. Clients such as Google, GlaxoSmithKline, and Nokia join thousands of growing small and medium businesses that benefit from outsourcing their office and workspace needs to Regus, allowing them to focus on their core business.

Over 500,000 clients a day benefit from Regus facilities spread across a global footprint of 1,000 locations in 450 cities and 75 countries, which allow individuals and companies to work wherever, however and whenever they want to. Regus was founded in 1989 in Brussels, Belgium and is listed on the London Stock Exchange (LSE:RGU).

For more information please visit www.regus.com

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