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Stimulus wind-down to exacerbate SME mental health struggles

Adrian Flores
Adrian Flores
31 August 2020 3 minute readShare
SME mental health struggles

The reduction in financial support from the government and lenders will likely see a significant rise in life insurance claims for work-related mental health conditions, with Victoria to become a major area of concern.

According to Rehab Management chief executive Marcella Romero, over $1.5 billion is paid annually in workers compensation and life insurance claims for work-related mental health conditions.

Since the start of the COVID-19 pandemic, she said psychological insurance claims have continued to steadily rise.

“Since February, we have seen a 35 per cent increase in these types of claims, which includes anxiety, depression, post-traumatic stress and other mental disorders,” she said.

“We expect this rise to continue especially as we approach various milestones during this crisis, such as a reduction in financial support from government or lending institutions, extended lockdowns, further job losses and other flow-on effects.”

Ms Romero said the corporate health provider’s research indicates that existing conditions are being exacerbated by the current climate and new mental health issues are emerging as well.

In particular, she pointed to lockdown-hit Victoria, where the mental wellbeing score showed an average score of “39”, which is considered “below average wellbeing”. The overall national data gave a score of “41”.

“This is low compared to what you would expect to see for a general population which is a score of 50. This tool has a sensitivity change of + or – 3, so it is quite significantly different,” she said.

“Low scores on this tool are also correlated with depression, so this data is very concerning.”

However, new data released by the Australian Bureau of Statistics found that feelings of anxiety and depression because of the COVID-19 pandemic were consistent nationwide, not just in Victoria.

The survey was conducted in mid-August, a time when daily new cases of the coronavirus in Victoria led to strong restrictions in the state and extra caution across Australia.

“In fact, the mid-August results were consistent across Australia with no significant differences reported by people in Victoria when compared with the rest of Australia,” said ABS head of household surveys Michelle Marquardt.

However, there were major differences between states on precautions being taken because of the spread of COVID-19, with marked differences between Victoria and the rest of the country.

“People in Victoria were more likely than the rest of Australia to wear a facemask (99 per cent compared with 44 per cent), keep physical distance from people (97 per cent compared with 91 per cent), and avoid large social gatherings (96 per cent compared with 77 per cent),” Ms Marquardt said.

“However, they were less likely to shop in physical retail stores (45 per cent compared with 81 per cent), attend their workplace in person (30 per cent compared with 66 per cent), send children to school or childcare (18 per cent compared with 74 per cent), or dine in at restaurants or cafés (2 per cent compared with 50 per cent).”

3 measures employers can do to foster a mentally healthy workforce

Rehab Management chief executive Marcella Romero outlined three key measures businesses can do to encourage a mentally health mindset among employees.

1. Inform and engage

“At a very basic level, it is incredibly important to engage with employees during this period and keep them informed as much as possible. This may be through regular staff briefing or, for larger companies, a multilevel communication strategy. It is also important to improve mental health awareness and train managers to recognise the signs of mental health issues, which can include things such as sick leave or other leave, performance issues, emotional outbursts, change in behaviour and interpersonal conflict.”

2. Provide access to support

“Many companies offer employee assistance programs, which generally include free access to private and confidential counselling. These programs can also provide high-level data around the number of people accessing the service, which may highlight issues within a business that need to be addressed. However, this is a ‘lag indicator’, meaning management is only aware once there is an issue and does not necessarily work as a preventative strategy.”

3. Prevention and intervention

“Smart companies are moving towards identifying those that may need support early. Evidence shows that structured workplace programs and interventions can make a difference to both employees and the bottom line. Australian companies can reap $2.30 for every $1 spent on workplace mental health strategies. A study by KPMG further highlighted the return on investment in such programs can be up to $10 for every dollar spent.”

Stimulus wind-down to exacerbate SME mental health struggles
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Adrian Flores
Adrian Flores

Adrian Flores is the deputy editor of MyBusiness. Before that, he was the deputy editor for SMSF Adviser as well as features editor for ifa (Independent Financial Adviser), InvestorDaily, Risk Adviser, Fintech Business and Adviser Innovation.

You can email Adrian at [email protected].

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