We are warning employers not to ignore the devastating impact the cost-of-living crisis will have on the ‘already fragile’ mental health of the UK workforce.

Following reports that work-related stress already costs the economy £28 billion year each year 1, we expect this figure to rise unless businesses step in to provide swift access to mental health support in the wake of the cost-of-living crisis.

Our Workforce Lead, Kris Ambler, said: “The cost-of-living crisis is delivering a sledgehammer-like blow to the UK’s already fragile workforce. It’s shattering the mental health of people both inside and outside of work. Employers can’t afford to ignore the impact it’s having on their staff. They must prioritise mental health in the workplace, think about the effects their decisions have on staff wellbeing, and ensure employees can access vital support such as counselling and psychotherapy if they need it.”

Kris was speaking after our roundtable event on Thursday 14 December - which saw businesses, unions, charities and employee assistance programme providers from across the UK meet to discuss the impact of the cost-of-living crisis on employers and their employees.

“The discussions we had last week, together with emerging data, indicate this is a major issue for employers and employees. The NHS simply can’t accommodate the volume of people seeking help from their mental health services - and we’re hearing that there’s a greater demand than ever. Our therapists are also seeing more complex cases as people experience greater financial difficulties which, in turn, leads to increased GP visits, more days off sick and, in some cases, a breakdown of the family unit.

“But the various challenges caused by the cost-of-living crisis needn’t have the debilitating mental health impact it’s having on individuals and business. Our message to employers is that although we know access to mental health services won’t solve all the problems caused by the cost-of-living crisis, it can significantly reduce the costs of disruption to their business and the wider economy.

“Research has proven time and time again that workplace counselling can halve sickness absence in organisations2, and employees that have access to mental health services return to work sooner, are more resilient, more productive, and less likely to become long-term sick.

“We know that for many organisations the cost of investment in mental health support remains to be a significant barrier, which is why we are also calling on the government to do more to support UK business and the mental health of their staff.”

Our recent survey 3 of over 3,000 members shows that two thirds (66%) of therapists saw the public’s mental health deteriorate over the last year, and nearly all (94%) attributed this to their financial concerns and the cost of living. The survey also showed that almost half (46%) of our therapists saw an increase in clients presenting with financial anxiety over the past year.

Further reports4 from AXA also found that poor mental health also accounts for more than half of all work-related illnesses - around 51% of long-term sick leave is due to stress, depression, or anxiety.5 And with the cost-of-living compounding financial struggles, the BACP doesn’t expect these figures to improve anytime soon.

Speaking after the cost of living event, Bertrand Stern-Gillet, CEO at Health Assured - providers of workplace wellbeing services - said:

“Financial worries are among the most common reasons for people to seek support and advice from our counsellors, and we’ve seen a steady rise in the number of calls received. There’s no denying that the most asked questions highlight a severe lack of support from both the Government and other organisations and we’re clearly seeing the impact this is having on peoples’ mental health.

“It’s no secret that many are struggling, and the longer the cost-of-living crisis goes on, this will only continue to rise. Feeling overwhelmed and unsupported, or struggling to even afford to commute to work, signifies deeper issues to come if these concerns are not properly addressed and support put in place. There’s only so far that people can stretch their finances. When the inevitable breaking point is reached, all that’s left is a question - what could have been done to help prevent this issue?

“While companies and organisations are also feeling the financial burden, it’s important to have sound support systems in place to support the wellbeing and mental health of their people. Prevention is always better than cure, and employers have a duty of care to look after the wellbeing of their employees. And with latest figures showing that mental health concerns are now the leading cause of workplace absence, it’s clear that more needs to be done to help employers maintain a healthy workforce.”

Miriam Mintz, Clinical Supervision Manager for Access to Work Mental Health Support Service, who was also at the roundtable, said:

“As providers of the Access to Work Mental Health Support Service on behalf of the Department for Work and Pensions, Able Futures has seen a huge increase in the demand for support from employees across all sectors - particularly following the COVID19 pandemic and recent cost of living crisis. At the same time, the complexity of the referrals has increased, with many people who are in acute distress and desperate for mental health support. As a result, there has been a significant rise in safeguarding referrals as well as in the need for signposting to financial, debt and benefits advice.

“We routinely see the best outcomes for those participants who have adequate support in their workplace. Most interventions tend to be reactive and focus on the individual but people do not exist in a vacuum, they are affected by a multitude of factors and preventative measures are needed to mitigate the impact.

“For these reasons, it has never been more important to invest in mental health provision in the workplace. In terms of what we are seeing on the ground, we expect this to remain the case for some years to come. In the long term, we would hope that mental health provisions become an integral part to all business plans rather than be seen as a short-term reactive measure. It is a long-term investment that benefits both individual businesses and the UK economy as a whole.”

Last week’s event is one in a series of roundtable events to help us understand the impact the cost-of-living crisis on mental health on already vulnerable communities. Information from these events will be used to gather evidence and insight to produce a broader report about the recommendations and implications for the cost-of-living crisis for at risk groups. The report will be launched next year.



1. AXA UK and the Centre for Business and Economic Research (Cebr)

2. McCleod, 2010

3. BACP 2023 Mindometer survey of over 3,000 members

4. AXA UK and the Centre for Business and Economic Research (Cebr)

5. www.mhfaengland.org