The views of this article are the perspective of the author and may not be reflective of Confessions of the Professions.
In the world of economics, only one things is certain: Everyone is subject to the law of unintended consequences. But when talking about work related injuries, it should be pretty straightforward, right? If only it were really that simple. As the law of unintended consequences unfolds, it turns out that a work related injury produces an amazing array of hidden costs; most of which could never be imagined or planned for in advance.
Hidden Costs we can easily brainstorm the “direct” costs of a workplace injury. But what about the hidden costs? For example, restaffing carries a cost of $2.2 billion annually. When someone is injured, they may need to be replaced. Even if this is temporary it still carries a cost.
Surprisingly, that $2 billion is only 2% of the total hidden costs! Fringe benefits make up $16 billion, while the largest hidden cost of $67 billion can be accounted for in lost earnings. Amazingly, 71% of the total cost of a workplace injury are indirect costs. That means that even the best planning and brainstorming, can only accurately plan for 29% of the total injury cost.
The True Culprits Suffice to say the numbers above are amazing. But what factors incur all of these hidden costs? Here, one might start to think that “Murphy’s Law” is now coming into affect along with the law of unintended consequences. Naturally, the obvious culprits for cost are present, i.e. workers compensation. But what about the cost to the company over legal fees, regulation related fines from government agencies? Some costs do not have an immediate financial cost. Things like a drop in morale amongst workers, or the impact on the company’s reputation, are still costs.
There also may be damage to tools and/or equipment, which may incur not only repair costs but compliance costs from a regulatory standpoint. Finally, there are legal fees and the inescapable increase in insurance rates. When all of those factors are applied to a single workplace injury, it is easier to see how the majority of the price placed on a workplace injury, comes from hidden costs.
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The True Cost of “Work Related Injuries”
Accidents Cost More Than Most People Realize!
When someone gets injured on the job, the direct costs are obvious. There are also additional “hidden” costs that can add up to more than the obvious direct costs.
These hidden costs are ultimately paid by:
Injured workers and their families
By other employees due to lowered wages
By firms through their lower profits
By consumers via higher prices
Around 6,371 job-related injury deaths And 13.3 million non-fatal injuries occur in the U.S. workplace in one year.
Direct Costs
Workers’ Compensation claims
medical only costs are roughly $26 billion (68%)
medical insurance administration costs are $5.5 billion (14%)
indemnity insurance administration costs are $6.8 billion (18%)
Occupations which contributed the costs on a per capita basis:
Lumberjacks
Millwrights
Prison guards
Meatcutters
Office workers
Occupations which generate the most disabling injuries:
Truck drivers
Nursing aids
Janitors
Occupations at highest risk for carpal tunnel syndrome include:
Dental hygienists
Meatcutters
Sewing machine operators
Assemblers
Office workers
Assault and violent acts, frequently have been ignored by OSHA, contribute 20% of injury deaths.
Back injuries are responsible for disabling injuries more than any other kind of injury.
There are hazards in any occupations… Murder is the most likely cause of death among sales workers and business executives.
More than 60% of the senior financial executives surveyed report that each $1 they invested in injury prevention returned $2 or more, a minimal gain of 100%!
SafetyVideos.com provides safety training videos that help alleviate these work related injuries. It’s only through proper training that an employer can best lower the number of accidents and injuries on the job site.
![Who Is Affected Most By A Work Related Injury? [Infographic]](https://cdn.confessionsoftheprofessions.com/infographics/cost-of-work-injuries-infographic.jpg)
