Making Sense Out of Safety
April 5, 2006
What would you do with $574.8 billion? According to an annual study completed by the National Safety Council, 23.8 million Americans or about 1 out of 12 sought medical attention for an injury in 2004. About 2.8 million people were hospitalized for injuries, about 40.2 million were treated in hospital emergency departments and about 99.9 million visits to physicians' offices were due to injuries1
....Unintentional-injury deaths were up 2% in 2004 compared with the revised 2003 total. Unintentional injury deaths were estimated to total 111,000 in 2004 and 108,900 in 2003. The 2004 estimate is 4% greater than the 2002 final count of 106,742. The 2004 figure is 28% greater than the 1992 total of 86,777 (the lowest annual total since 1924) and 5% below the 1969 peak of 116,385 deaths1. ....The economic impact of these fatal and nonfatal unintentional injuries amounted to a direct cost to society of $574.8 billion in 2004. This is equivalent to about $2,000 per capita or about $5,100 per household. These are costs that every individual and household pays whether directly out of pocket, through higher prices for goods and services, or through higher taxes1.
The United States is still much better than we were in the early and mid 1900s when the injury rates were double or triple than what we see today. Some estimates project that since 1912, the consistent drop in injury rates, while the nation's population has tripled, has resulted in 5,000,000 fewer people being killed due to unintentional injuries1 .
Occupation InjuriesSimilar injury rate trends can be seen in the U.S. workplace. In fact, the incidence rate for total recordable cases was 4.8 per 100 full-time workers in 2004, down 4% from the 2003 rate of 5.0. The same is not true for the cost of medical care. The average cost for all injury claims combined in 2002-2003 was $17,787. This is up 12% from the 2001-2002 average of $15,865. Of the $574.8 billion in injury costs in 2004, $142.2 billion is associated with worker injury costs. This means that the average U.S. worker must produce about $1,010 more in goods and services to offset the cost of work injuries1.
Workplace deaths are even more costly, averaging around $1,150,000 to cover wage losses, medical expenses, administrative expenses and employer costs. Fortunately, the overall trend in injury related occupational deaths has been good, although there was a slight increase in the injury death rate in 20041
Operationalizing SafetyThere is always room for safety improvement in the workplace. I have not met any business owner who states that their current injury rates are "right were they want them to be" - unless it is zero. Fortunately, a number of studies have shown a well thought out safety intervention has a successful payback in the form of reduced incidents and costs. The research data indicate that successful safety programs have strong management commitment as well as a stratified approach consisting of intervention applications in the following four areas:
Studies completed by Haight et.al. (2001a, 2001b) indicate that the optimum time allocated to safety should be about 17% of the human resource time available to each worker3. The HR time allocation is different for each work place, but a good rule of thumb is to allocate between 1.5 - 2% of operation time to safety. In a typical workplace, this amounts to about 3 hours per month. Therefore, the average resource allocation for a $20/hr worker (after benefits) is about $60/month or $720/year.
This may seem like a lot, but considering that the average workplace injury cost is $17,787, the payback is about 4 injuries per 100 workers. Not to mention the added benefits that go along with a successful safety program such increased morale, productivity and product quality, as well as reduced turnover. IH