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NIOSH Programs > Global Collaborations > Economic Factors
Global CollaborationsInput: Economic FactorsEconomic factors affect US and global workplaces in many ways. The cost of occupational illness and injury to employers, workers, their families, and to society are immense. Preventive actions to ensure health and safety have a price. Decision-makers for occupational safety and health include individual employers who can benefit from economic analyses of the costs and benefits of interventions. Global partnerships are working to provide useful information and tools for analysis at company level. Hopefully, simple tools that allow companies to conduct economic evaluation will persuade employers of the financial benefit of keeping workers safe and healthy. Costs of work-related illness and injuryAdditional information about the economic aspects of work-related illness, injury, and interventions can be found on the NIOSH Economics Emphasis Area Program Web pages. The International Labor Organization (ILO) estimates that the total cost of global work-related injury and illness amount to approximately 4 percent of the world’s Gross Domestic Product .1 A study by the European Commission estimates that the cost of occupational injury (not including illnesses) in the 15 European Union Member States in the year 2000 was €55 billion. 2 Cost effectiveness of interventions in the workplaceThe World Health Organization (WHO) published studies in the 2002 World Health Report regarding the cost-effectiveness of using interventions to reduce exposure to various risk factors3 These studies evaluated the cost of interventions and the resulting gain in health. The WHO economic models were used to calculate cost and gain for two occupational outcomes. The cost-effectiveness of interventions to reduce back pain due to occupational exposures was evaluated in WHO geographic regions that illustrate different levels of development. The analysis found that the most effective intervention to reduce back pain from occupational exposure is a full ergonomics program that includes engineering controls and training; implementing such could offer a 74% reduction in back pain incidence. Fewer benefits would be obtained if engineering control (56% reduction), or training (20% reduction) were implemented alone. The full ergonomics programs were found to be cost-effective for their health effects in all three regions without even considering the possible increase in productivity that could be brought about by the interventions. 3, 4 A second study evaluated the cost-effectiveness of alternative interventions to reduce silicosis in developed and developing nations. The interventions included engineering controls which protect many workers (substitution; wet method; local exhaust ventilation; total plant ventilation), and worker training plus personal protective equipment which protects only the individual worker. The study concluded that engineering controls in both developed and developing regions are the most cost-effective interventions with expenditures between I$105 and I$109 per healthy year saved in the two regions. This level of expenditure is considered to be very cost-effective and should be the first choice where resources are scarce. 5 A Net-Costs Model was developed because cost-effectiveness studies using the WHO model measure only health gains, and because the decision-making power regarding occupational risks lies with the employer. The Net-Costs model makes possible a type of economic evaluation that measures all costs paid by an employer to implement interventions to reduce back pain and all costs avoided (i.e. net-costs). This type of economic evaluation measures monetary savings through avoiding sick days and by the increased productivity of a healthier workforce, for example. The model was tested successfully in three case studies and is undergoing further evaluation. 6 Tools for Economic Evaluation of Occupational Health and Safety Interventions at Company LevelThe Economic Evaluation of Occupational Health and Safety Interventions at the Company Level Conference, held in November 2004 in Washington, D.C., was sponsored by NIOSH and the WHO. Attendees from government agencies, public and private research organizations, academic institutions, private industry, and worker groups from different parts of the world reviewed existing tools for conducting economic evaluations of efforts and initiatives designed to improve working conditions in businesses of all sizes and throughout the world. The models ranged from individualized approaches for small businesses in the Netherlands to a structured method for use at garment factories in Central America to a highly sophisticated computerized system used in corporate settings in the U.S. The proceedings of the conference were published by the Journal of Safety Research (Volume 36, Number 3, Pages 207-308, 2005). The articles published in the Journal of Safety Research describe the following tools:
ResourcesProceedings of the Economic Evaluation of Occupational Health and Safety Interventions at the Company Level Conference References
Page last updated: November 4, 2008
Page last reviewed: October 27, 2008 Content Source: National Institute for Occupational Safety and Health (NIOSH) Office of the Director |
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NIOSH Program:Global Collaborations |
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