Effects Of Addiction On Companies and the Workplace

Addiction has significant detrimental effects on companies and the workplace, primarily manifesting as decreased productivity and increased absenteeism. Employees with addiction issues often miss deadlines and complete fewer tasks, leading to substantial disruptions.
Substance Use Disorders (SUDs) are notably prevalent across various industries, especially in safety-sensitive roles, according to the National Safety Council.
Industries such as construction, mining, and service are particularly affected, with higher rates of alcohol and drug use disorders. Conversely, sectors like education, healthcare, professional, and protective services report fewer incidences, yet even in these fields, one in twelve workers is battling a substance use disorder which is very costly for companies. According to the National Safety Council, workers with substance use disorders miss nearly 50% more days than their peers.
Addiction costs U.S. companies over $400 billion annually in lost productivity, healthcare, and legal fees. The industries most affected include construction, service occupations, and transportation. Male-dominated occupations often see higher rates of substance use disorders due to cultural norms that normalize substance use as a coping mechanism.
Signs of substance abuse at work include patterns of absenteeism, declining productivity, emotional outbursts, and increased accidents. Effective strategies for addressing substance abuse include implementing Employee Assistance Programs (EAPs), conducting educational workshops, and promoting a supportive workplace culture.
If an employee discloses a substance problem, companies should respond empathetically, encourage treatment, and maintain confidentiality while supporting the employee’s recovery.
What Are the Effects of Addiction on Companies and the Workplace?
The effects of addiction on companies and the workplace include decreased productivity, as employees with addiction issues often miss deadlines and complete fewer tasks, leading to significant disruptions. Increased absenteeism is another critical impact, with affected employees taking more sick leave, further compounding productivity losses.
Addiction significantly affects companies and workplaces in several detrimental ways. Here are some of the primary impacts:
Decreased Productivity
Employees with addiction issues often experience declines in their performance, leading to missed deadlines and incomplete tasks. According to the National Safety Council, workers with substance use disorders miss nearly 50% more days than their peers, which can severely disrupt productivity.
Increased Absenteeism
Addiction leads to higher rates of absenteeism. Employees struggling with substance abuse are more likely to take sick leaves frequently as they cope with the effects of their addiction, compounding productivity losses.
According to Parsley, I’s 2022, “Association Between Workplace Absenteeism and Alcohol Use Disorder From the National Survey on Drug Use and Health”, analyzed 110,701 adults found that 9.3% reported alcohol use disorder (AUD), with absenteeism increasing in relation to AUD severity.
Specifically, individuals with no AUD missed an average of 13 days from work annually, while those with mild AUD missed 17.7 days, moderate AUD 23.6 days, and severe AUD 32.3 days. Employees with AUD accounted for 14.1% of total workplace absences.
Workplace Safety Issues
Substance abuse can significantly impair cognitive and motor functions, heightening the risk of accidents and injuries. The U.S. Department of Labor reports that workplace injuries are five times more likely to occur among employees with alcohol problems.
The National Institute for Occupational Safety and Health’s Fatalities in Oil and Gas database revealed that from 2014 to 2019, 26 worker deaths were linked to substance use, with methamphetamine or amphetamine being the most prevalent substances involved (61.5%).
Impact on Coworker Relationships
The erratic behavior of employees suffering from addiction can strain relationships with their coworkers who may need to compensate for their decreased workload, leading to increased stress and workplace tension. According to Goplerud, E.’s 2017 study, “A Substance Use Cost Calculator for US Employers With an Emphasis on Prescription Pain Medication Misuse,” workers with substance use disorders (SUDs) miss about 50% more days than their peers, averaging 14.8 unscheduled leave days per year.
This increased absenteeism not only affects the productivity of the individual but also places additional burdens on their coworkers, exacerbating workplace tension and stress.
Increased Healthcare Costs
Employees with addiction issues often require more medical care, resulting in higher healthcare costs for employers. Acccordign to Li, M.,’s 2023 study, “Medical Costs of Substance Use Disorders in the US Employer-Sponsored Insurance Population”, in 2018, among 162 million non-Medicare enrollees with employer-sponsored health insurance, 2.3 million were diagnosed with a substance use disorder (SUD).
The average annual medical cost for each affected enrollee was $15,640, totaling $35.3 billion for the entire population. The highest costs were associated with alcohol-related disorders ($10.2 billion) and opioid-related disorders ($7.3 billion).
Legal and Financial Consequences
Addiction can lead to legal issues that may impose significant financial burdens on employers, including legal fees and compensation for damages. This includes costs related to compliance with workplace safety regulations and potential liability for accidents.
According to Goplerud, E.,2017 study, “A Substance Use Cost Calculator for US Employers With an Emphasis on Prescription Pain Medication Misuse”, employees with any substance use disorder (SUD) generally use more healthcare services than their peers. However, those with a pain medication use disorder have a significantly higher usage of healthcare services. Workers in recovery use healthcare services at slightly lower rates than their peers and less than those with an untreated SUD.
What Are the Signs of Alcohol or Drug Abuse at Work?
The common signs of alcohol or drug abuse at work include patterns in an employee’s absences, such as frequent absences after payday or on Mondays and Fridays. Consistent lateness to meetings, declining productivity, and emotional outbursts or irritability may also indicate underlying issues. Further, aggression strained working relationships, and an increase in accidents or near accidents can be red flags.
Here’s a list of signs that may warn you about an employee having a substance use disorder:
- Keep an eye out for any patterns in an employee’s absences, such as the day after payday or Mondays and Fridays.
- When someone consistently arrives late to meetings.
- If an employee’s productivity is declining.
- Emotional outbursts or irritability may be a sign of underlying issues.
- Aggression and strained working relationships can be indicative of a larger problem.
- If there are more accidents or near accidents at work.
- An employee appearing disheveled or not using their camera during online meetings may signify something more.
- If an employee smells of alcohol or appears to be using excessive breath mints, it could be a cause for concern.
- Bloodshot eyes or tremors.
- Poor decision-making.
- Theft is a serious issue that should be addressed immediately.
- If someone consistently takes bags or coats to the bathroom.
- Weak excuses for missed deadlines or incomplete tasks should be taken seriously.
- Social withdrawal.
- Sleepiness or napping at work.
What Effective Strategies Can Be Employed When Addressing Substance Abuse in The Workplace?
Effective strategies for addressing substance abuse in the workplace include creating a supportive and healthy work environment. Employers can take proactive steps, such as providing access to confidential resources and fostering a culture that encourages open discussions about addiction.
By implementing programs that offer assessments and counseling, along with conducting educational workshops, organizations can equip employees with the knowledge and support they need. Additionally, promoting a workplace culture that reduces stigma can empower individuals to seek help sooner.
Employers can implement several strategies:
- Employee Assistance Programs (EAPs): Offering access to EAPs that provide confidential assessments, short-term counseling, referrals, and follow-up services for employees facing substance abuse issues.According to Bouzikos, S.’s 2022 study, suggest that EAPs could have a greater impact by also helping organizations improve their PSC through better policies and practices for worker psychological health and safety, in addition to individual interventions.
- Education and Training: Conducting workshops and training sessions to educate employees about the risks of substance abuse and promoting a drug-free workplace policy. According to Tsiboukli, A’s 2022 study, training is essential for professionals in the substance misuse field to improve service quality and collaboration among practitioners. Many professionals lack the necessary skills and experience to effectively address clients’ needs in drug treatment settings.
- Support for Treatment: Encouraging treatment and recovery by providing resources and possibly offering healthcare plans that include addiction treatment.
- Promoting a Supportive Environment: Establishing a workplace culture that supports recovery and reduces stigma associated with addiction, which can encourage employees to seek help sooner.
By understanding the multifaceted impacts of addiction on companies and implementing comprehensive support systems, companies can better manage these challenges, leading to improved overall workplace health and productivity.
How Does Addiction Impact Workplace Productivity?
Drug addiction impacts workplace productivity by creating a cycle of symptoms like mood modification, withdrawal, and issues stemming from excessive work. These symptoms lead to job burnout, which manifests as exhaustion, cynicism, and decreased effectiveness.
Morgan, J. R.’s 2022 study, “Estimating Absenteeism Related to Nonalcohol Substance Use in a US National Cohort of Full-Time Employees”, reveals that 18% of full-time employed individuals report illicit substance use, with 3% meeting the criteria for substance use disorder (SUD). These patterns of substance use are linked to increased absenteeism, leading to substantial economic costs—an estimated $16.4 billion in lost wages annually.
The findings highlight that addiction not only affects individual employees but also creates a cycle of productivity loss for organizations, as those struggling with substance use may experience symptoms such as mood modification and withdrawal, ultimately resulting in job burnout characterized by exhaustion and reduced efficacy.
How Much Does Addiction Cost Companies?
Addiction costs U.S. companies over $400 billion annually in lost productivity, healthcare, and legal fees. Substance abuse leads to absenteeism, workplace accidents, and higher insurance claims. Implementing Employee Assistance Programs and comprehensive substance abuse policies can help mitigate these costs.
- Overall Costs to the Economy: According to the 2016 Surgeon General’s Report, substance use disorders lead to over $400 billion in annual expenses across healthcare, law enforcement, the criminal justice system, and lost workplace productivity. These costs reflect the wide-ranging effects of addiction on public services and economic output.
- Lost Productivity: Former U.S. Army General and drug czar, Barry R. McCaffrey, has highlighted that drugs in the workplace alone cost U.S. employers approximately $200 billion a year in lost productivity. This staggering amount includes losses due to absenteeism, decreased job performance, and workplace accidents, all of which are more prevalent among employees dealing with substance use disorders.
- Costs of Alcoholism to Companies: The U.S. Office of Personnel Management estimates the annual cost of alcoholism and alcohol abuse to companies to be between $33 billion and $68 billion. These costs arise from similar productivity losses, including absenteeism, injuries, health benefits, and potential liability issues.
- Healthcare Expenses: Employees with substance use disorders typically incur higher healthcare costs, attributed to the need for treatment of various medical conditions related to addiction. These are often chronic conditions that require long-term management and can significantly drive up employer-sponsored health insurance premiums.
- Workplace Safety and Compensation Claims: Addiction can lead to higher rates of workplace accidents, increasing workers’ compensation claims and insurance costs for employers. The risk of injury not only affects the individual employee but can also pose a safety risk to others, leading to potential legal liabilities for the company.
- Turnover and Re-training Costs: Companies also face financial burdens from turnover rates higher among employees with addiction issues. The costs of recruiting, hiring, and training new employees to replace those who leave due to substance-related issues add another layer of financial strain on businesses.
- Legal and Compliance Costs: Companies must navigate compliance with drug-free workplace policies and regulations, which can involve significant legal resources and administrative costs. Failing to comply with these regulations can result in fines, penalties, and damaged reputations.
Which Industries Are Most Affected by Addiction?
The industries most affected by addiction include construction trades, where 19% of workers face substance issues, and service occupations, with a rate of 15.6%. Transportation and material-moving workers are also significantly impacted at 13.9%.
The following is a table provided for the National Safety Council and the University of Chicago showcasing the industries most affected by addiction in the workplace.
OCCUPATION | Percent |
Construction trades and extraction workers | 19% |
Service occupations, except for protective | 15.6% |
Transportation and material-moving workers | 13.9% |
Installation, maintenance, and repair workers | 13.5% |
Sales occupations | 13.4% |
Entertainers, sports, media, and communications | 13.0% |
Production, machinery setters, operators, tenders | 12.9% |
Executive/administrative/managerial/financial | 11.0% |
Farming, fishing, and forestry occupations | 10.9% |
Technicians and related support occupations | 10.6% |
Office and administrative support workers | 10.6% |
Professional (not education/entertainment/media) | 8.9% |
Education, health, and related occupations | 8.0% |
This table represents Workplace Addiction Statistics broken down by industry showing the percentage of substance misuse by employees in that industry.
Why Do Male-Dominated Occupations Have Higher Rates of Substance Use Disorders?
Male-dominated occupations see higher rates of substance use disorders due to masculinity norms that promote endurance and self-sufficiency, leading to normalized substance use as a coping mechanism.
According to a 2013 study “Addressing the Specific Behavioral Health Needs of Men,” Work cultures in these fields often celebrate heavy drinking and lack supportive networks for healthy coping strategies.
Additionally, emotional suppression in men results in maladaptive coping through substances, especially in high-stress jobs. Early exposure to intense work environments sets a precedent for future substance use behaviors, while economic dynamics attract young men to high-paying, low-education jobs that are often linked to prevalent substance use. Addressing these factors is crucial for improving public health and workplace interventions.
For instance, in the construction industry, one in five workers (19%) experiences an SUD, which is double the rate found in educational and professional fields that have more women and older workers, such as teaching, architecture, engineering, medicine, nursing, librarianship, and biology.
What Should Companies Do If an Employee Discloses a Substance Problem?
Companies should respond calmly and empathetically if an employee discloses a substance problem. Begin by thanking the employee for sharing and reassure them that their situation will be treated like any other medical issue. Encourage them to consult their doctor for appropriate treatment options and consider allowing time off for professional help, updating sick policies if necessary. Maintain professional boundaries while focusing on how to support them in the workplace.
When discussing the situation with the employee’s co-workers, approach the conversation with sensitivity and confidentiality. Focus on the impact on the workplace rather than personal details, and promote a supportive, non-judgmental environment. Emphasize the importance of respecting privacy and direct them to general resources on understanding addiction, such as supporting co-workers, without delving into the individual’s specific circumstances.
If an employer discovers an employee using drugs, reaching out to family members should be done cautiously and in compliance with privacy laws. The employer should first consult with human resources and legal advisors to ensure adherence to privacy regulations and workplace policies before speaking with the affected family members. If appropriate and legally permissible, the employer can express concern and offer support or resources to the family, emphasizing the focus on the employee’s well-being and available assistance programs, including resources for the affected spouse.
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