Absenteeism, a pattern of missed work and unplanned absences, is a billion-dollar problem—costing U.S. employers more than $225.8 billion in lost productivity annually. There are a variety of reasons why an employee might be absent, ranging from transportation issues to the need to care for a loved one. But the bottom line is that absenteeism is costing companies big bucks. It also undermines trust between the employee, the employer, and the coworkers who are forced to pick up the slack.
To get a clearer understanding of the financial impact of absenteeism on your business you can calculate the rate of absenteeism by using the absenteeism rate formula.
What is the Absenteeism Rate?
The absenteeism rate is the percentage of work time that an employee was supposed to be working, but wasn’t. This includes days that an employee calls out of work at the last minute, is several hours late, or doesn’t show up at all. It doesn’t include planned time off, such as vacation days or holidays. Measuring the average absenteeism rate for the company can help leaders understand the financial impact of absenteeism on the bottom line.
For some context first, an absenteeism rate of 1.5% is considered the benchmark number that organizations should strive to meet in the U.S. However, according to data from the U.S. Bureau of Labor Statistics, the average absenteeism rate is 3.2%.
How to Calculate Absenteeism Rate
There is a standard absenteeism rate formula businesses can use to calculate the rate of absenteeism. The absenteeism rate formula is:
Absenteeism rate = number of absences / number of work days
To calculate absenteeism rate, you need to divide the number of unplanned absences by the total number of workdays during the specified period.
For this formula, first you’ll need the number of workdays in the period you’re measuring. Don’t count days that employees aren’t expected to work, such as weekends or holidays, and vacation days—since these are pre-planned and don’t count as absences. Need help? Tools like Time and Date or Working Days can do the work for you.
To calculate workdays for a full year, the formula would be the total number of calendar days minus weekend days, minus holidays, minus vacation days equals the total workdays.
For example:
365 (calendar days) – 105 (weekend days) – 10 (holidays) – 15 (vacation days) = 235 workdays
Next, you’ll need to calculate the number of absent days during this time period, either by total number of employees, or by an individual whose absences you want to take a closer look at.
Absenteeism Rate Example:
For a single employee’s absenteeism rate, let’s say they had 235 scheduled workdays, and five days of unplanned absences. To calculate their absenteeism rate, you need to divide the number of absences (5) by the number of workdays (235) and multiply that by 100 and you get 2.1%.
(5 absences / 235 workdays) x 100 = 2.1% absenteeism rate
Excessive Absenteeism in the Workplace
It’s estimated that absenteeism costs U.S. employers $1,685 per employee per year. Not only that, excessive absenteeism in the workplace can undermine employee morale for those forced to cover for the absent employee.
Common causes for higher-than-normal absenteeism can include:
- Gaps in child care, senior care, or pet care
- Illness
- Mental health challenges
- Stress and burnout
- Job dissatisfaction
Absenteeism rates in the workplace are not universal. Some occupations will have higher absenteeism rates than others. According to the U.S. Bureau of Labor Statistics, some of the professions with the lowest rates include computer and mathematical occupations (2.1%). On the higher end of the spectrum, healthcare support occupations came in at 5%.
Solutions for Absenteeism in the Workplace
One of the best ways to reduce absenteeism in the workplace is by empowering managers to keep the lines of communication open with their direct reports. Managers should make sure they understand an employee’s individual challenges, and collaborate on solutions to help minimize absences.
Another way to support employees and reduce potential absences and improve productivity rates is by offering care benefits. Of the HR leaders we surveyed for The Future of Benefits, 88% reported that child care benefits helped increase productivity, and 86% said they also experienced a similar impact from offering senior care benefits.
- Care benefits. A Care Membership can help employees find vetted caregivers for children, adults, and pets, and Backup Care provides access to employer-subsidized care for times when their regular, ongoing care is unavailable.
- Mental health benefits. Employers can help lighten the load for employees experiencing stress and burnout by offering access to mental health services.
- Flexible PTO options. If an employee is able to request more approved time off in advance it can help reduce the chances they will call out at the last minute.
It’s also important to create clear policies around absenteeism. This should spell out what you consider absenteeism, what is considered an acceptable absence range (and what is not), and what the consequences will be for frequent, unexcused absences.
By being transparent about what your expectations are as an employer, and empowering employees to schedule time off in advance, you may start to see your absenteeism rates trend down. Not only that, you’ll likely have happier, healthier, and more productive employees.
