Addressing mental health at work is not just a response to crises. It’s a strategic imperative for organizations looking to attract and retain top talent.  

During the COVID-19 pandemic, mental health went from a side conversation to one of the most urgent topics inside organizations. It was encouraging to see leaders expand benefits, launch wellness initiatives, and speak openly about employee well-being.

But years later, many companies have scaled back their focus, even as 68% of HR professionals admit their organization’s mental health benefits significantly contribute to recruitment efforts. 

This is especially concerning given that the United States Surgeon General reports that 84% of respondents in a Mental Health at Work survey said their workplace conditions had contributed to at least one mental health challenge.

Mental health at work was never meant to be temporary, and ignoring it now risks productivity, engagement, retention, and ultimately, profits.

The Business Case for Mental Health

Supporting employee mental health isn’t just compassionate. It’s smart business.

Research shows for every $1 invested in wellness programs, companies save $2.73 in absenteeism and $3.27 in medical costs. At a broader level, the McKinsey Health Institute estimates that improving employee health and well-being could unlock up to $11.7 trillion in global economic value, primarily through increased productivity and reduced burnout.

Meanwhile, neglecting mental health comes at a steep cost. The World Health Organization estimates depression and anxiety alone cost the global economy $1 trillion annually in lost productivity. And a study published in the American Journal of Preventive Medicine estimates that poor employee mental health and burnout costs the average U.S. company of 1,000 employees roughly $5 million annually, based on a computational model developed by researchers.

The Impact of Employee Mental Health on Engagement, Attendance and Performance 

Employee mental health isn’t just a wellness concern. Poor mental health comes with extensive costs to the company. At the same time, improving employee well-being can be a key driver of engagement, attendance, and overall performance.

Employees who report poor or fair mental health have four times as many unplanned absences as their counterparts, according to Gallup. Engagement suffers as well. Gartner reports that just 31% of employees report feeling engaged, enthusiastic, and energized by their work. This presents a major loss considering those who are energized are 31% more likely to stay and 31% more likely to “go above and beyond.”

So, how can employers drive a more engaged and energized workforce?

The first step is recognizing that the pressures on employees are not easing. 

Rapid technological change, including expectations around AI adoption, causes stress as employees push to keep up with the learning curve. Hybrid work models have blurred the boundaries between home and office. An increasing number of companies are enforcing return-to-office policies which put an additional strain on caregivers. At the same time, ongoing economic uncertainty and geopolitical concerns permeate at home and at work. 

In this environment, mental health support can’t be episodic or reactive. It requires human-centric leadership and sustained effort. 

Key Ways Organizations Can Support Employee Mental Health

The good news is that meaningful change doesn’t require an overhaul. Focusing on a few key areas goes a long way:

• Inclusive, accessible benefits that make it easy for employees to access mental health support when they need it.
• Flexibility in how work gets done, including thoughtful hybrid models and return-to-office approaches.
• Manager training and support to help leaders elevate their skills as coaches, recognize burnout, lead with empathy, and connect employees to resources.
• A culture that normalizes mental health conversations, where executives lead by example, reducing stigma and encouraging employees to seek support early.
• Intentional work design that incorporates fractional resources and sets realistic expectations to help prevent burnout before it starts.

Here is what this looks like in practice: 

What Leading Organizations Are Doing

Leading companies are continuing to invest in employee mental health in meaningful, visible ways — not as a perk, but as a core business priority, creating environments where employees feel genuinely supported and engaged. 

Lloyds Banking Group: partnered with Mental Health UK and trained thousands of colleagues as Mental Health Advocates to help create peer-led mental health support across the organization.

Lululemon: provides company-wide Mental Health First Aid training as part of its holistic approach to employee well-being.

PwC: continues expanding mental health benefits, doubling free therapy sessions from 6 to 12 annually and increasing out-of-network coverage to 90%.

Goldman Sachs: introduced mental-health first aide training to equip employees with skills to recognize and respond to mental health challenges in the workplace.

New York-Presbyterian: Chief Talent Officer Jyoti Rai shared on our Inspired Leadership podcast that wellness coaches “round the floors” to provide real-time well-being check-ins for healthcare workers during their shifts, meeting their team where they are. 

A Call to Action for Leaders

The pandemic accelerated the conversation around mental health, but it didn’t create the need. Six years later, mental health concerns continue, with both long-term and emerging stressors. In the future of work, leaders who treat well-being as a core business strategy, not a seasonal priority, will be the ones who attract, retain, and get the best from their teams.