According to data from the US Bureau of Labor Statistics, companies in America pay $62 billion per year for workplace injuries — that’s more than $1 million per week. Of course, the true costs of a workplace injury are far greater than raw cost. Not only are there other financial burdens associated with a workplace injury, but there are also issues of morale and other indirect costs that can be difficult to quantify.

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A medically-consulted injury has an average cost of $42,000, while a death has an average cost of $1.15 million. Of course, when you speak of a serious injury or death, it’s hard to say that any amount of money can really compensate an employee for their pain or their family for their loss. It’s about more than just dollars and cents.

Unintentional accidents are at an all-time high and are presently the third leading cause of death behind heart disease and cancer. And that means that workplace injuries need to be protected against at all costs: not only is it financially important, but is a moral obligation of the business that’s also important for the morale and the health of the company.

The Indirect Costs of a Workplace Injury

The direct costs of a workplace injury only comprise 29 percent of the total injury costs. The indirect costs are an additional 71 percent. Direct costs cover the actual amount of money that is spent (or will be spent) on the medical care for the individual who has been injured or the money given to the family of a deceased.

But direct costs are only the tip of the iceberg and only a fraction of the total cost of a workplace injury.


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Indirect costs can include:

  • Lost production time. The business may be understaffed while an employee recovers, and the business often comes to a grinding halt whenever an accident occurs.
  • Damaged equipment. Workplace injuries also have a tendency to lead to equipment damage, and the same carelessness that can lead to workplace injuries can also cause isolated damage to equipment.
  • Reduced morale. Employees who are upset are not going to be productive or efficient. Employees will need time to recover, and they may also need some psychological care, especially if a serious injury or death occurred.
  • Lower efficiency. Working with fewer employees or with untrained employees will always cause difficulties for an organization. And, if an employee is out for recovery, this adds an additional workload to all of the other workers, leading to increased work exhaustion, fatigue and disengagement. Not only does this lead to less work being done, but it also leads to unhappy clients.
  • OSHA penalties. If an accident is found to be caused by negligence, a company may face significant OSHA penalties and other fines and fees. These go up the more accidents occur.
  • Negative effects on company reputation. Clients don’t want to deal with a company that has a lot of workplace accidents, not just out of concern for the employees, but also because of concern for the quality of work.
  • Employee recruitment and retention. If employees are seriously injured and unable to work, it can lead to tremendous restaffing costs as well as a reduction in morale and problems retaining employees that are still there.

The cost of general workplace disruption cannot be dismissed nor can the ultimate impact on the organization’s reputation. OSHA provides a tool, “$afety Pays,” which aids in assessing the impact of occupational injuries and illnesses. The company’s profit margin, average costs of an injury or illness, and an indirect cost multiplier are used to project the amount of sales a company needs to generate to cover those costs.

Using Tech-Driven Systems to Reduce Costs

Companies have a moral obligation to provide a safe working environment for their workers. On top of that, delivering safety also helps avoid a damaged reputation, diminished morale, and added costs. Safety software can help. Implementing successful injury prevention programs can reduce injuries by 15 to 35 percent, saving companies on average $9 to $23 billion per year. Injury prevention programs are a combination of training, processes, and safety software solutions. Learn more about how your business can be more proactive in your efforts to prevent a lost work day. 

Implementing new processes and safety software alone isn’t enough. Workforce participation and engagement is crucial. Employers need to work to create a culture of safety that includes:

  • Maintaining written safety processes.
  • Creating consequences for safety infraction.
  • Implementing safety software solutions.
  • Offering continued safety training.

Learn how Anvl can help you engage your workforce in safe, productive, and efficient work.


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