0 Comments | May 17, 2010

News Your CFO Needs to Hear

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Rising healthcare costs, a looming retention crisis, and the slow pace of economic recovery all have CFOs burning midnight oil to bring company ledgers back in balance.

If you’ll pardon a little shameless self-promotion, we have news your CFO can use: Vacation Wellness™ saves money. How much? Prepare to be pleasantly surprised.

A few examples:

  • A business services company with 36 employees and an average annual salary of $69,000 can save $141,130 every year with Vacation Wellness™.
  • A 150-employee IT firm that pays an average employee salary of $58,000 per year saves an estimated $408,000 every year.
  • A utilities company with 1,250 employees and a $43,000 average employee salary saves approximately $2.68M every year with Vacation Wellness.™

How much can your company save? We’ve put together a calculator to help you figure out a conservative estimate.

We love full disclosure, so here’s all the source information for our Vacation Wellness™ savings estimator:

  • Depression costs an inflation-adjusted $8,415 in direct expenses, and causes 9.9 lost days of work. That doesn’t count lost productivity while depressed employees are at work. There was no good data for presenteeism costs, so we left that expense out of our computations – despite estimates that presenteeism is at least as expensive for employers as the direct depression costs. 10% of over 400,000 workers studied developed depression. (Source: Managed Care Magazine and Employee Benefit News).
  • Vacationers are up to three times less likely to develop depression (Source: WebMD).
  • Heart disease strikes 16.1% of American workers between the age of 25-64. It costs an inflation-adjusted $8,523 in direct expenses, and causes an average of 7.5 days of sick leave per episode (Source: The Centers for Disease Control and Managed Care Magazine).
  • Regular female vacationers are 53% less likely to develop heart disease, and males have 32% lower heart disease risk (Source: The Framingham Heart Health Study).
  • Even though the numbers are extremely well documented (the sample size for the smallest study was 46,000 people), we divided our estimated healthcare cost savings in half. We prefer to err on the conservative side. See more comprehensive research results here.
  • The Bureau of Labor Statistics publishes voluntary employee turnover data by industry. We used an average of the last ten years’ data, which is summarized here.
  • The cost to replace an employee is detailed here. We used a conservative replacement cost salary multiplier of 2.75 in our calculations.
  • reports that an effective employee benefits program is the top reason 20% of all employees stay with their employer. We used an ultra conservative 5% voluntary turnover reduction figure in our turnover cost reduction estimate. See the complete turnover report.

Impressed? Pardon us for gushing, but we are too. It turns out that employee vacations are a powerful business cost savings tool. Make your CFO’s day – have her ask for a custom price quote and savings summary.