Smokers cost employers $5,816 more than non-smokers

BY  Benefits Pro

June 4, 2013 • Reprints

The price of a carton of Kools just went up. Way up. But not for smokers. It’s employers who are paying, primarily in time lost to cigarette breaks by smoking employees.

Smoking employees cost their employers an average of $5,816 more each year than do non-smoking workers. This figure comes from new research authored by Ohio State University researcher Micah Berman, whose team based its work on previous research that had not been considered strictly from a cost-per-employee standpoint.

“This estimate should be taken as a general indicator of the extent of excess costs, not as a predictive point value,” Berman said in his abstract for the study. “Employees who smoke impose significant excess costs on private employers. The results of this study may help inform employer decisions about tobacco-related policies.”

The research was published in this month’s issue of the journal Tobacco Control.

Surprisingly, it isn’t smokers’ higher health care costs that represent the biggest chunk of extra change. According to Berman’s analysis of the data, the work time lost to smoking breaks was the largest cost to employers. (Comparable costs of coffee and chai latte breaks by non-smokers was not included.) The annual per-employee financial breakdown cited by the study showed:

  • smoking breaks cost $3,077
  • excess healthcare costs $2,056
  • excess absenteeism costs $517
  • presenteeism costs $462

(Presenteeism was defined as lower productivity while working because of nicotine addiction.)

“Previous studies have found that smoking by employees costs businesses money because of smoking-attributable productivity losses and medical expenditures, but estimates have been vague and did not distinguish between costs borne by employers and those absorbed by others – the smokers themselves, insurance companies, or taxpayers,” Tobacco Control said in a release citing the study’s result.

“(This) study was carried out in the context of some U.S. employers having begun to charge smokers higher premiums for health insurance, while others have decided they will only hire non-smokers. Some firms have even decided they will no longer retain employees who do not quit smoking within a given period of time.”

Berman said the study, which used employee income data as a basis for its extrapolations, factored in evidence that shows that smokers already earn 15.6 percent less on average than non-smokers. He added that employers are increasingly offering smoking workers programs to help them quit.

“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.”

The journal said 19 percent of U.S. adults smoke cigarettes.

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