Any company's most important asset is its people. Our experts in leadership, culture, talent, reskilling, and HR help businesses respond to current and future challenges.
Young Canadians are burning out at work, and the unchecked stress is contributing to a national mental health epidemic which costs the country more than $200B annually. Businesses have the opportunity—and imperative—to address this crisis by creating workplace cultures that prioritize mental wellbeing as a key performance driver, with embedded systems which proactively enable their employees to thrive.
A quarter of all Canadians reported symptoms of mental health disorder in 2021, five million reported needing help for their mental health, and more than a third (35%) say they are burned out.
This crisis is disproportionately impacting young people. About 40% of Canadian workers aged 18 to 24 years are at a mental health “breaking point.” By the time they reach age 40, half will have experienced some form of mental illness.
Work is the number one source of stress for Canadians. But while most organizations care greatly about the health and wellbeing of their employees, many have been slow to recognize the extent of the crisis. A lack of strategy, a lack of support and stigma in discussing mental health have created workplace cultures where young people and their managers feel discouraged from presenting these issues.
But research by Boston Consulting Group shows that work is worth fixing. Our study finds that investing in mental health and wellbeing can create a virtuous cycle, delivering massive returns for Canadians, Canadian businesses and the economy as a whole. Through interviews, surveys and focus groups, we learned that:
Workplace wellbeing drives growth—but organizations will need to change their practices and cultures to unleash it. Top-performing businesses we’ve talked to have a shared goal: to become the organization that everyone wants to join. These are the steps to begin that journey.
Now is the time to act. Changing workplace cultures is a journey—but it is one that organizations must begin today. BCG is committed to making this same journey. We believe that wellbeing can open a wellspring of growth, improving quality of life for Canadians, increasing the productivity and competitiveness of Canadian businesses, and helping to attract and retain the next generation of Canadian talent.
We developed this report in hopes of sparking dialog and look forward to continuing our discussion with you.
Young Canadians are burning out at work, and the unchecked stress is contributing to a national mental health epidemic.
A quarter of all Canadians reported they suffered from some form of mental illness in 2021, and five million said they needed help to manage those needs, making mental illness the leading cause of disability in the country.
Young people are disproportionately impacted. New to the workplace and rocked by years of pandemic-related dislocations, as many as 40% of workers between the ages of 18 and 24 say they are at a mental health “breaking point.” At current rates, nearly one in two Canadians will experience mental illness by the time they are 40. However, a lack of organizational focus and stigma in discussing mental health have kept these issues largely closeted and unaddressed.
Apart from the staggering human toll, declining mental health also has a significant economic impact . Research by Boston Consulting Group finds that the direct and indirect costs across Canada exceed $200 billion annually.
While work may be a key source of stress, it may also be the source of Canada’s recovery. BCG analysis shows that changing workplace cultures and practices to foster wellbeing can open a wellspring of growth, improving quality of life for Canadians, increasing the productivity and competitiveness of Canadian businesses, and helping to attract and retain the next generation of Canadian talent.
This paper looks at where workplace health is breaking down and what organizations can do to turn wellbeing into a wellspring of growth.
In late 2022, BCG surveyed more than 1,300 young Canadian workers and conducted more than 30 interviews, talking to employees, managers, leaders and field experts about how their workplaces contributed to their mental wellbeing.
What we learned was troubling. Each year, 20% of Canadians experience some form of mental health challenge. The pandemic has been an exacerbating factor, but the number of Canadians who say they are struggling with mental health has been growing even before the COVID-19 crisis, rising by more than 13% annually since 2016.
Work is a leading driver of declining wellbeing. Over 25% of Canadians report that work is the main source of stress for them, and 35% report being burned out.
Young people are especially vulnerable. In 2022, 50% of young professionals reported needing help for an emotional or mental problem. One reason is the pandemic, which disrupted normal processes for relationship-building and learning. Another is a lack of attention to helping newer recruits forge meaningful connections when they begin a new job. Absent practices that enable relationship building, meaning and purpose during onboarding, younger employees can feel isolated and adrift. About 20% of new entrants into the workforce report that transitioning into the workforce had a negative effect on their mental wellbeing. A third issue is regressive perceptions about Gen Z—that this generation “needs to be coddled” and “lacks ambition.” These negative biases remain persistent despite the fact that data consistently disproves them, and they make workplaces a more significant cause of stress for younger workers.
Black and Indigenous Canadians also face particular stressors: 55% of Black workers say they do not feel safe from workplace discrimination and 40% of Indigenous employees said they have been victims of bias as a result of their identity.
The total economic cost of addressing mental health and disability exceeds $220 billion annually. The direct costs, including public sector spend amounts accounts for nearly 10% of total public health spend or $32 billion overall. Indirect costs, including worker downtime and presenteeism, is estimated at $190 billion, plus other hidden costs in reduction of quality of life for family, friends and loved ones.
Fortunately, there are ways to mitigate this crisis, and Canadian businesses can take the lead in doing so.
Our research shows that investing in mental health and wellbeing can create a virtuous cycle, delivering massive returns for Canadians, Canadian businesses and the economy as a whole.
Here are some of the ways in which better workplace health delivers powerful ROI.
For Canada to reap these benefits, however, leaders need to understand the factors that are contributing to lower wellbeing at work.
Most organizations want to create vibrant and inclusive workplace cultures where individuals can thrive. Most also recognize the very real issues concerning burnout and the long-term strain many employees have been operating under since the pandemic began.
But the traditional business model has kept work and life largely separate, and matters of mental health further removed still. This orientation creates a culture that discourages workers from discussing stress. And that’s especially so for younger workers, who are taking their cues from those around them.
Through surveys, focus groups and interviews, BCG identified four factors contributing to lower mental health and wellbeing in the workplace.
These challenges are complex. However, our research shows they are also addressable and can create a virtuous cycle that advances personal, professional and business growth—a win for Canadians and Canadian businesses.
Taking the lead on mental health and wellbeing can give organizations competitive advantage—making them more attractive to key talent, and enabling significantly higher retention and productivity.
These are the steps companies need to take to begin that journey.
Finally, organizations need to create policy supports that can help managers and HR understand how to have productive conversations with employees. This guidance can help them navigate grey areas and understand when external resources may be most helpful.
The authors would like to thank the following advisers and colleagues for their valuable contributions to the development of this article: Joseph Sexsmith, Bill Howatt, Josh Hellyer, Eric Windeler, Tanya Halsall, Nina Abdelmessih, Charlotte MacDonald, Alexandre Torres, Zubby Achara, Lauryn Murphy, Colan Wang and Heather Lau.