Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Absenteeism

What it is:

In the business world, absenteeism refers to the rate at which employees do not arrive for work as scheduled.

How it works (Example):

Company XYZ is a health care provider. It has 25 nurses who are each responsible for seeing 10 patients a day. Every day, one or two nurses are not at work due to vacation or sickness. However, in the past month absenteeism has risen. Now, four or five nurses are often missing for the day, putting a severe strain on the nurses who do come to work, increasing the wait times for patients, and increasing the number of medical errors the nurses are making.

Why it Matters:

Absenteeism increases costs and lowers profits because it reduces productivity and often work quality. A similar problem, presenteeism, occurs when employees choose to stay at work but handle personal and family issues at their desks rather than working. Many forms of absenteeism are protected by law (such as family leave under FMLA). Often, however, absenteeism can increase when workers feel stressed. U.S. companies lose billions due to chronic employee absenteeism.