Featured Research

from universities, journals, and other organizations

Companies pay almost $6,000 extra per year for each employee who smokes

Date:
June 3, 2013
Source:
Ohio State University
Summary:
A new study suggests that U.S. businesses pay almost $6,000 per year extra for each employee who smokes compared to the cost to employ a person who has never smoked cigarettes. Researchers say it's the first study to take a comprehensive look at the financial burden for companies employing smokers.

A new study suggests that U.S. businesses pay almost $6,000 per year extra for each employee who smokes compared to the cost to employ a person who has never smoked cigarettes.

Related Articles


Researchers say the study is the first to take a comprehensive look at the financial burden for companies that employ smokers.

By drawing on previous research on the costs of absenteeism, lost productivity, smoke breaks and health care costs, the researchers developed an estimate that each employee who smokes costs an employer an average of $5,816 annually above the cost of a person who never smoked. These annual costs can range from $2,885 to $10,125, according to the research.

Smoke breaks accounted for the highest cost in lost productivity, followed by health-care expenses that exceed insurance costs for nonsmokers.

The analysis used studies that measured costs for private-sector employers, but the findings would likely apply in the public sector as well, said lead author Micah Berman, who will become an assistant professor of health services management and policy in The Ohio State University College of Public Health on Aug. 21. Berman began this work while on the law faculty of Capital University in Columbus.

"This research should help businesses make better informed decisions about their tobacco policies," said Berman, who also will have an appointment in the Moritz College of Law at Ohio State. "We constructed our calculations such that individual employers can plug in their own expenses to get more accurate estimates of their own costs."

The study focuses solely on economics and does not address ethical and privacy issues related to the adoption of workplace policies covering employee smoking. Increasingly, businesses have been adopting tobacco-related policies that include requiring smokers to pay premium surcharges for their health-care benefits or simply refusing to hire people who identify themselves as smokers.

The researchers acknowledge that providing smoking-cessation programs would be an added cost for employers.

"Employers should be understanding about how difficult it is to quit smoking and how much support is needed," Berman said. "It's definitely not just a cost issue, but employers should be informed about what the costs are when they are considering these policies."

The research is published online in the journal Tobacco Control.

The Centers for Disease Control and Prevention (CDC) estimated a decade ago that productivity losses and medical costs amount to about $3,400 each year per smoker. However, the report looked at overall costs to the American economy from smoking-related deaths and did not try to identify those costs that would be borne by an employer, Berman noted.

The CDC says smoking accounts for nearly one in every five deaths -- or about 443,000 -- in the United States each year and increases the risk for such illnesses as coronary heart disease, stroke, lung cancer and other deadly lung illnesses.

The researchers used multiple studies that calculated a variety of specific costs to develop an estimate of the overall annual extra cost of each employee who smokes.

According to their annual estimates per smoker, excess absenteeism costs an average of $517 per year; "presenteeism," or reduced productivity related to the effects of nicotine addiction, $462; smoke breaks, $3,077; and extra health care costs (for self-insured employers), $2,056.

The analysis also took into consideration a so-called death "benefit" in terms of economics. For employers who provide defined benefit plans, meaning they pay retirees a set amount in pension each year, a smoker's early death could result in an annual cost reduction of an estimated $296. This occurs when smokers pay more into the pension system than they receive in retirement -- in effect, subsidizing nonsmokers' pensions because they live longer.

"We tried to be conservative in our estimates, and certainly the costs will vary by industry and by the type of employee," Berman said. "Several of these estimates are based on hourly employees whose productivity can be tracked more easily."

He noted that the analysis takes into account the known disparity in pay for smokers versus nonsmokers. In the calculations, smokers' salaries were discounted by 15.6 percent to reflect their lower wages.

The researchers describe their findings as "needed factual context to discussions about workplace policies" intended to inform the debate over whether such policies should exist.

"Most of the places that have policies against hiring smokers are coming at it not just from a cost perspective but from a wellness perspective," Berman said. "Many of these businesses make cessation programs available to their employees.

"Most people who smoke started when they were kids and the vast majority of them want to quit and are struggling to do so. This is a place where business interests and public health align. In addition to cutting costs, employers can help their employees lead healthier and longer lives by eliminating tobacco from the workplace."

Co-authors of the study include Rob Crane of the College of Medicine and Eric Seiber of the College of Public Health, both at Ohio State, and Mehmet Munur of the Columbus law firm Tsibouris & Associates.


Story Source:

The above story is based on materials provided by Ohio State University. Note: Materials may be edited for content and length.


Journal Reference:

  1. Micah Berman, Rob Crane, Eric Seiber, Mehmet Munur. Estimating the cost of a smoking employee. Tob Control, 3 June 2013 DOI: 10.1136/tobaccocontrol-2012-050888

Cite This Page:

Ohio State University. "Companies pay almost $6,000 extra per year for each employee who smokes." ScienceDaily. ScienceDaily, 3 June 2013. <www.sciencedaily.com/releases/2013/06/130603192958.htm>.
Ohio State University. (2013, June 3). Companies pay almost $6,000 extra per year for each employee who smokes. ScienceDaily. Retrieved October 25, 2014 from www.sciencedaily.com/releases/2013/06/130603192958.htm
Ohio State University. "Companies pay almost $6,000 extra per year for each employee who smokes." ScienceDaily. www.sciencedaily.com/releases/2013/06/130603192958.htm (accessed October 25, 2014).

Share This



More Health & Medicine News

Saturday, October 25, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

IKEA Desk Converts From Standing to Sitting With One Button

IKEA Desk Converts From Standing to Sitting With One Button

Buzz60 (Oct. 24, 2014) IKEA is out with a new convertible desk that can convert from a sitting desk to a standing one with just the push of a button. Jen Markham explains. Video provided by Buzz60
Powered by NewsLook.com
Ebola Protective Suits Being Made in China

Ebola Protective Suits Being Made in China

AFP (Oct. 24, 2014) A factory in China is busy making Ebola protective suits for healthcare workers and others fighting the spread of the virus. Duration: 00:38 Video provided by AFP
Powered by NewsLook.com
WHO: Millions of Ebola Vaccine Doses by 2015

WHO: Millions of Ebola Vaccine Doses by 2015

AP (Oct. 24, 2014) The World Health Organization said on Friday that millions of doses of two experimental Ebola vaccines could be ready for use in 2015 and five more experimental vaccines would start being tested in March. (Oct. 24) Video provided by AP
Powered by NewsLook.com
Doctor in NYC Quarantined With Ebola

Doctor in NYC Quarantined With Ebola

AP (Oct. 24, 2014) An emergency room doctor who recently returned to the city after treating Ebola patients in West Africa has tested positive for the virus. He's quarantined in a hospital. (Oct. 24) Video provided by AP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:

Breaking News:

Strange & Offbeat Stories


Health & Medicine

Mind & Brain

Living & Well

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile: iPhone Android Web
Follow: Facebook Twitter Google+
Subscribe: RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins