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The Mind Blowing Costs of Smoking Every Employer Needs to Know

Healthcare costs are not the only smoking-incurred costs employers face
By: Amanda McDonald
August 31st, 2017

We already know smoking is bad for you, you can die from it, and it costs money to keep up the habit.

But there’s more you need to know about smoking than that.

The Centers for Disease Control and Prevention estimates the total cost of smoking in the United States exceeds $167 billion per year.1

That number can be broken down to $75 billion in direct healthcare costs1 and $92 billion in lost productivity resulting from years of productive life lost due to premature death.2

When these numbers are examined further, researchers have been able to identify how smoking can affect businesses.

Smoking employees cost businesses more money than non-smokers

Employees who smoke cost your businesses big dollars. Exactly how much?

In fact, employees who smoke cost their employers nearly $6,000 a year according to research.3  

What’s interesting, is this cost can get broken down into many factors that result in revenue loss.

What’s costing you money as an employer?

Smoke breaks

Smoke breaks cost an employer more than healthcare costs or any other costs incurred by a smoking employee.

Productivity lost during smoke breaks accounts for approximately $3,077 in losses, based on an estimate of five smoke breaks throughout the workday.3

Think about it. Smokers need to gather their things, inform other of their intended break, walk outside, smoke a cigarette and maybe chat for a while doing so, walk back inside, and then regroup to continue working. It’s easy to see how 30 seconds to smoke a cigarette can turn into a 10-minute break.

However, if an employee is willing to stop smoking, smoke breaks are one cost that can be eliminated.

Presenteeism

It’s challenging to measure lost productivity due to presenteeism accurately, but studies continue to demonstrate that employees who smoke are less productive than employees who do not.4

Nicotine addiction is a powerful thing. Within 30 minutes after finishing inhaling a cigarette, smokers can experience both physical and psychological withdrawals. Prolonged withdrawals diminished a smoker’s productivity at work as withdrawals take away employees’ focus on their tasks.1

A conservative calculation of the annual cost of smoker-related presenteeism estimates there is a 1% to 4% loss of productivity due to presenteeism. This results in an annual average cost of between over $450 up to $1,800.3

Excessive healthcare costs

Whether an employee smokes during working hours or outside of work, smoking is a habit that deteriorates health.

Typical coexisting health concerns smokers have include poor diet, lack of exercise and overuse of alcohol. On top of those concerns, serious health issues like chronic pulmonary obstructive disease, asthma, lung cancer, heart disease, diabetes, and stroke can be caused by smoking.

That being said, it’s estimated that employers are paying around $2,000 annually for smoking-attributed costs per smoking employee.3

To address these additional costs, some employers require employees who smoke to pay higher healthcare premiums. However, paying higher premiums might not be enough to compensate for the fact that, overall, smoking employees are less productive than nonsmokers or even former smokers.

How to avoid smoking-related costs

In summary, the cost calculations of smoke breaks, presenteeism, and excess healthcare costs amount to about $5,500, when using low-end cost estimations.

Another smoking-related cost is absenteeism, which accounts for an additional $500 or more per smoking employee per year.3

All of these together add up to an accumulated total of $6,000 annually per smoking employee.

As employers, you have a great opportunity to influence the habits of your employees.

You can encourage your employees to quit smoking. At the same time, you can implement practices and policies that put a bit more pressure on employees to kick their smoking habit.

If you don’t already have a smoking policy in place, review this with your leadership team and develop one that is right for your organization.

Support your employees by offering them a variety of resources and opportunities to quit. As mentioned before, nicotine is incredibly addictive. It will likely take smokers more than one time to stop their habit.

Continue to show your employees you care about their health throughout the quitting process. Your personal support and the support of your organization could help save lives and save money!

  1. Centers for Disease Control and Prevention. (2004). Smoking-attributed mortality, morbidity, and economic costs; adults and maternal and child health software. US Department of Health and Human Services.
  2. Bunn, W., Stave, G., and Downs, K., et al. (2006). Effect of smoking status on productivity loss. Journal of Environmental Medicine.
  3. Berman, M, Crane, R, Seiber E, et al. (2013). Estimating the cost of a smoking employee. BMJ Publishing Group Ltd. Retrieved from http://ucanr.edu/sites/tobaccofree/files/175136.pdf
  4. Halpern MT, Shikiar R, Rentz AM, et al. (2001). Impact of smoking status on workplace absenteeism and productivity. Tobacco Control. Retrieved from http://tobaccocontrol.bmj.com/content/tobaccocontrol/10/3/233.full.pdf
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