Every second full-time employee in Germany has already left a job due to their mental health. In Generation Z, this figure is as high as 81%, and among Millennials, it is 68%.
Nevertheless, a misconception often creeps into discussions about investing in employee mental health: they are viewed purely as a cost factor.
Yet a look at the data shows quite the opposite: doing nothing is far more expensive: Sick days are increasing, turnover is intensifying, and presenteeism is causing productivity to drop. This makes mental health initiatives a strategic investment.
This article highlights the costs of non-investment, the advantages of mental health benefits, and provides a template that HR professionals can use to calculate the costs for their company.
How the Template Works
The calculation template translates the insights from this article into a customized financial analysis for your company. By entering a few basic inputs—such as employee headcount, average salary, average sick days, and turnover rate—the template uses current benchmarks to calculate your annual costs for sick leave, turnover, and presenteeism driven by mental health challenges.
The Real Cost of Ignoring Employee Mental Health
1. Sick Days
The trend is clear. Data from the AOK from 2025 shows:
- Mental illnesses now cause 43% more missed workdays than ten years ago.
- Mental illnesses are the biggest driver behind the increase in long-term sick leave: absenteeism days due to mental illnesses lasting more than six weeks rose sharply between 2016 and 2025.
The DAK Report also confirms: Mental illnesses are consistently among the most frequent reasons for long-term sick leave, further driving up the average number of missed workdays.
Calculation Example: 500 Employees
The model uses average values for sick days and takes into account that around 17% of them are due to mental illnesses. Each of these days causes direct costs in the amount of the proportional daily salary.
Baseline Data
- Employees: 500
- Average Salary: 55.000 €
- Average Daily Salary: 55.000 € ÷ 240 working days = 229 €
- Sick Days: 22 Days/Year
- Mental Health-Related Absence: 3.74 Days per Employee
500 × 3.74 mental health-related days × €229 ≈ €428,200 per year
Nearly €430,000—solely for mental health-related sick days. And this doesn’t even factor in the loss of productivity within the team.
2. Turnover
Mental health and the willingness to change jobs are closely linked. When acute mental distress is ignored for too long, affected employees often see resigning as their only way out.
For companies, this means a double financial burden: on the one hand, direct expenses for replacement, including recruiting, onboarding, and the loss of knowledge. On the other hand, productivity and execution speed decline because experienced employees leave and new colleagues need time to become fully effective.
The rule of thumb in HR practice: depending on the role and seniority, replacing a position costs 1.5 to 2.5 times the annual salary.
Calculation Example: 500 Employees
Baseline Data
- Employees: 500
- Average Salary: 55,000 €
- Turnover Rate: 7 % (35 Employees per year)
With an average turnover rate of 7%, 35 people leave the organization each year in a company with 500 employees. Assuming that replacing a position costs 1.5 times the annual salary, the calculation is as follows:
35 × 1.5 × €55,000 ≈ €2,887,500 per year
This is by far the largest item in the business case.
3. Loss of Productivity due to Presenteeism
Presenteeism, or reduced performance despite being present, is one of the most frequently underestimated cost drivers. According to the World Health Organization, presenteeism causes trillions in productivity losses worldwide. Presenteeism can cause costs roughly twice as high as absenteeism. In addition, employees who go to work despite being ill or already under strain prolong their symptoms and often face longer absences later on.
Calculation Example: 500 Employees
If the costs of presenteeism are roughly twice as high as those of mental health-related sick days (see above), the resulting figure is:
≈ €856,500 per year
The Cost of Inaction
- Sick days: €428,200
- Turnover: €2,887,500
- Presenteeism: €856,500
For a company with 500 employees, failing to actively invest in the mental health of its workforce costs up to €4.17 million per year. That is the benchmark against which every single investment must be measured.
The Impact of Investing in Employee Mental Health
Companies that invest in their team’s mental health not only cut costs but also boost motivation, well-being, and performance across the organization. Employees with good mental health are proven to be more engaged and productive: 63% report working with high productivity, and 80% feel energized.
Satisfaction & Well-Being
The figures collected by nilo speak for themselves. After using nilo, employees see significant changes:
- 96% of users report that their mental health has significantly improved through nilo
- 82% with severe symptoms experience an improvement
- 71% under stress feel better thanks to nilo
Crucial for HR: nilo is used up to ten times more often than traditional Employee Assistance Programs, making the investment per actual use significantly more efficient.
Productivity
This is where the impact becomes particularly measurable. The nilo data shows: using platform content alone reduces unproductive days by 44%. In combination with 1:1 sessions with psychologists, that figure rises to 50.3%.
Innovation
Research from creativity and workplace studies shows: mentally resilient employees not only handle demanding tasks more efficiently, but also contribute new ideas more frequently. Innovation happens in minds that have the capacity to think beyond day-to-day business.
Preparing for Change Processes
Organizational changes are mentally demanding. In these situations, resilient employees are more likely to view new requirements as a challenge rather than a threat.
The mental strength of the team is what determines the success of restructurings, transformations, or phases of change. When companies invest in the mental health of their employees well before the next change project, they gain a massive advantage.
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With this template, you can calculate in just a few minutes what inaction is costing your company – and how an investment in mental health compares against it.
