What are the economic consequences of the work environment?

Ulf Johanson and Emmanuel Aboagye

Chapter 2 in Pluralistic Economics, 2026, pp 12-22 from Edward Elgar Publishing

Abstract: This chapter explores the complex relationship between the work environment and economic performance, examining how employee health influences financial outcomes for individuals, companies, and society. By analyzing decades of research, the authors detail the direct and indirect costs associated with sickness absence and the rising phenomenon of presenteeism, where working while ill can lead to long-term productivity losses and exhaustion. The discussion evaluates the evolving evidence linking workplace well-being to organizational profitability, noting that while some historical data were skeptical, modern studies often show that investments in safety and psychosocial support yield positive returns on investment and higher stock market valuations. Ultimately, the chapter serves as a comprehensive overview of occupational health economics, arguing that strategic management of the work environment is not only a moral duty but a rational financial decision that enhances long-term business sustainability.

Keywords: Sickness absence; Presenteeism; Productivity and profitability; Health economics; Work environment costs; Economic consequences (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035393497
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