ECONOMICS

Inputs: Occupational Safety and Health Risks

The Economics Program translates occupational risks into the economic burden of worker injuries and illnesses that is commonly expressed in dollars. Measures of the economic burden are used by other NIOSH programs along with more traditional measures of occupational risks, such as numbers and rates of worker injuries, illnesses, and fatalities, to understand and communicate the many dimensions of the burden of worker injuries and illnesses. Measures of pain and suffering, such as health-related quality of life, constitute another dimension of this burden.

The broadest measure of economic burden is the cost that society overall bears. This is the measure that is used for assessing the impact of government policy, including recommendations and legislation.

Assessments of the economic burden borne by specific stakeholders, such as the costs borne separately by employers and workers, also are important. Assessing employer costs of worker injuries and illnesses can help to identify instances in which there are clear payoffs to employers from investing in prevention. Assessing employer costs can also identify situations in which policies may be needed to encourage or require employers to take additional preventive measures.

The economic burden of worker injuries and illnesses can be estimated by different methodologies. Common methodologies include “cost of illness” and “willingness to pay.” The cost of illness approach estimates the costs of treating worker injuries and illnesses (direct costs) and productivity and income losses associated with these injuries and illnesses (indirect costs). The cost of illness approach is commonly used in public health and is the predominant method used in the examples of economic burden estimates listed in the following section. The willingness to pay approach estimates the monetary amounts individuals are willing to pay to avoid the risk of a specific injury or illness or of death. These amounts take into account not only direct and indirect costs but also the value an individual places on avoiding suffering and activity limitations, which is not considered by the cost of illness approach. Because it implicitly includes pain and suffering, the willingness to pay approach is commonly used by government regulators.

Estimates of the economic burden of worker injury and illness

Some of the best available estimates of the national economic burden of worker injury and illness are listed here. These estimates only focus on some important portions of the economic burden of worker injury and illness for which we have relatively good quality and accessible data. For a current bibliography of NIOSH-supported research that includes economic burden assessments visit the publications section of this website.

Overall Measures of the Economic Burden of Worker Injuries and Illnesses
Source	Year for which estimate was calculated	Burden estimate in 2010 dollars	Predominant perspective	Examples of major cost components included
Leigha	2007	$263 Billion (total) $6 Billion (fatal injuries) $196 Billion (nonfatal injuries) $48 Billion (fatal illness) $13 Billion (nonfatal illness)	Societal	Medical costs as part of workers' compensation and national health expenditure estimates Productivity losses at work and home Indemnity payments as part of workers' compensation Labor turnover, hiring and training for replacement workers Workers' compensation administrative costs Non workers’ compensation administrative costs
Sengupta et al. b	2007	$88.2 Billion	Employer	Workers’ compensation

^a Leigh JP. Economic Burden of Occupational Injury and Illness in the United States (), Milbank Quarterly 2011. 89(4):728–772.

^b Sengupta I, Reno V, Burton JF Jr. Workers' compensation: benefits, coverage, and costs, 2007. Washington, DC: National Academy of Social Insurance; 2009.

 

Disease-Specific Measures of the Economic Burden of Worker Injuries and Illnesses
Injury/illness type	Source	Year for which estimate was calculated	Burden estimate in 2010 dollars	Predominant perspective	Examples of major cost components included
Injuries and musculoskeletal disorders related to: --overexertion --fall on same level --fall to lower level --bodily motion --struck by object --highway incident --caught in or compressed by machinery --repetitive motion --struck against object --assaults/violent acts	Liberty Mutual c	2008	$ 53.42 Billion	Employer	Workers’ compensation
Fatal injuries	Biddle and Keaned	2002	$ 5.6 Billion	Societal	--Medical cost --Productivity losses

^c Liberty Mutual Research Institute for Safety. 2010 Liberty Mutual Workplace Safety Index.

^d Biddle E, Keane P. The economic burden of occupational fatal Injuries to civilian workers in the United States based on the Census of Fatal Occupational Injuries, 1992-2002, NIOSH Publication 2011-130.

 

Industry-Specific Measures of the Economic Burden of Worker Injuries and Illnesses
Industry	Source	Year for which estimate was calculated	Burden estimate in 2010 dollars	Predominant perspective	Examples of major cost components included
Fatal and nonfatal injuries in construction	Waehrer et al. e	2002	$11.5 Billion	Societal	--Medical costs --Productivity losses --Quality of life losses

^e Waehrer GM, Dong XS, Miller T, Haile EH, Men Y. Costs of occupational Injuries in construction in the United States, Accid Anal Prev 2007. 39(6):1258–1266.