Understanding the Cost of Workplace Injuries and How to Prevent Them

With employers spending more than $1 billion each week on serious, nonfatal workplace injuries, the financial impact of poor worker safety is truly astonishing. Here’s how to keep workers safe—and mitigate those preventable expenditures.

Companies looking to better manage costs and improve safety conditions for their workers would do well to focus their efforts on minimizing the most expensive workplace incidents.

Overexertion—defined as working beyond one’s physical capabilities—is the most costly cause of workplace injuries nationwide, according to the 2020 Liberty Mutual Workplace Safety Index, which tallies the leading causes of the most serious workplace accidents that mean an employee misses more than five days from work. 

The estimated cost to employees from overexertion is $13.98 billion each year, according to the report, which is more than double the third-highest injury cause on the list: being struck by an object or equipment, which costs businesses $6.12 billion a year. The category includes injuries related to lifting, pushing, pulling, holding, carrying or throwing objects.
 

Overall, disabling workplace injuries cost U.S. businesses more than $59 billion annually, Liberty Mutual found in its research, yet the leading causes of these injury costs can be mitigated with fairly straightforward safety measures or increased employee training. 

Read more: Workplace Fall Protection: How to Use a Safety Harness and Lanyard

“Improving safety is critical to better protecting workers and companies’ bottom-lines,” says James Merendino, Liberty Mutual National Insurance Risk Control vice president and general manager.

To do so effectively, employers must “focus on the causes of the most serious injuries,” he adds. 

10 Most Costly Causes of Workplace Injuries and Ailments

Indeed, minimizing the risk of accidents begins with your company’s commitment to safety and understanding how the most common injuries happen. Employers can then start to reorient their operations to better manage and mitigate safety risk.

According to the 2020 index, the 10 most costly causes of disabling workplace injuries and illnesses are:

1. Overexertion involving outside sources (handling objects)

2. Falls on same level

3. Struck by object or equipment (being hit by objects)

4. Falls to lower level

5. Other exertions or bodily reactions

6. Roadway incidents involving motorized land vehicle (vehicle crashes)

7. Slip or trip without fall

8. Repetitive motions involving microtasks

9. Struck against object or equipment (colliding with objects)

10. Caught in or compressed by equipment or objects (running equipment or machines)

The 2020 index shows that these 10 injuries by themselves amounted to $52.9 billion in direct U.S. workers’ compensation costs, translating into more than $1 billion per week that businesses spend on just the top 10 most costly injuries, the report said. 

The company researched the top 10 causes and ranked them by their direct cost to employers, based on medical and lost-wage expenses. The data were compiled using information from Liberty Mutual, the U.S. Bureau of Labor Statistics and the National Academy of Social Insurance.  

This year, Liberty Mutual included injury cost findings segmented by specific industries. To help you improve safety and reduce costs in your facility, here is the list of the top five costly injuries in the manufacturing sector and tips on how to avoid them:

Making the Case for More Safety Training

These injury statistics are a good place to start when identifying areas where more safety training is needed.

With the COVID-19 pandemic placing a greater strain on company finances, companies are no doubt looking for ways to save on costs. And safety managers seeking investments in safety require a strong business case. 

Read more: Ladder Safety Tips: What You Need to Know to Protect Your Workers

Using safety calculators to better understand and estimate costs of injuries to support your investment decisions is a good approach. You can create a snapshot of safety performance in your company with your TCR and DART rate scores, and track how they compare to other companies in your industry using NAICS codes. 

These scores help you to benchmark your business against industry averages. Scores higher than average are a lead indicator that safety practices should be updated, and they can result in lost business or higher insurance premiums. They can also help you make a strong business case for increasing your training budget.

The good news is that with more safety training now done virtually due to the pandemic, your workers can stay up to date on the latest safety practices despite dwindling travel budgets and the need for widespread physical distancing.

Read more: How to Calculate the OSHA Dart Rate

More Tips to Improve Safety in Your Manufacturing Facility

Here’s a collection of our best articles on preventing costly workplace injuries:

Reducing the Indirect Costs of Workplace Injuries

OSHA Recordable vs. Reportable Incidents: How to Tell the Difference

10 Steps to Prevent Slips, Trips and Falls in the Workplace

5 Big Machine Guarding Mistakes and How to Avoid Them

Recommended Practices for Safety and Health Programs: 10 Ways to Get Your Program Started

A Safety Insider’s Take: When to Train and Retrain Your Associates