Absenteeism costs Canadian firms billions

The average Canadian employee was off for almost two full work weeks in 2011—a trend expected to intensify as the population ages. But although absenteeism costs companies billions of dollars, many fail to track their employees’ time off.

A new Conference Board of Canada survey reveals that the 2011 average absenteeism rate in the country was 9.3 days per full-time employee. The public sector absenteeism rate (12.9 days) exceeded that of the private sector (8.2 days). And among unionized workers, the rate was 13.2 days, compared with 7.5 days for non-unionized employees, according to the report, called Missing in Action: Absenteeism Trends in Canadian Organizations.

Companies estimate that the direct cost of absenteeism averaged 2.4% of gross annual payroll, which translated to a total loss of $16.6 billion in 2012. This figure does not take into account indirect costs that might affect firms, such as replacement expenses for absent workers, administrative costs and the negative effects on other employees or customers.

Despite the direct and indirect losses associated with absenteeism, in 2012, only 46% of Canadian companies tracked absenteeism by date, a slight increase from 40% in 2009. Even fewer organizations measured the direct cost of absenteeism—only 15% tracked this data, same as in 2009.

“Unless organizations start proactively addressing absenteeism, this trend will most likely accelerate as the workforce ages,” says Nicole Stewart, author of the report. “Organizations can begin to address the issues through better tracking of the number of absences and reasons for absenteeism.”

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