The 5 Costs of Waiting to Improve Worksite Field Facilities

The financial risks of unsafe work environments are no secret: medical, legal, and insurance costs add up quickly. But there are less obvious costs that arise from unsafe worksite facilities. While often overlooked, these costs can profoundly affect a company’s culture, reputation, and long-term viability. For all those companies on the fence about improving their outdated and unsafe worksite facilities, this blog is a guide to the true cost of inaction.

First, let’s look at the obvious financial costs and risks associated with unsafe work environments.

• Medical expenses
• Workers' compensation claims
• Increased insurance premiums
• Compliance fines
• Legal action

These factors can easily be associated with a dollar amount, and those numbers alone can spur businesses to create safer work environments for the sake of cost. For instance, in 2020 the National Safety Council found that the cost per worker death was $1.39 million, and the cost per medically consulted injury was $40,000. These estimates reflect not just the cost of workers’ compensation insurance, but the total economic cost to employers, employees, and the economy. 

But there are less straightforward costs that come with unsafe work facilities. While these might be harder to quantify than an OSHA fine or a workers’ comp payout, their long-term damage can be crippling. 

1. Decreased Productivity

Outdated and inadequate worksite facilities can include inefficient layouts, malfunctioning equipment, or unsafe conditions. All of these slow down an employee’s ability to optimally complete tasks. 

Consider a recent air freight customer of ours. Their employees had to walk about 20 minutes round-trip to reach a break area. Added up across all employees, that’s a substantial amount of time and employee energy wasted unnecessarily. And it doesn’t even take into account the risk of unsheltered employees in severe weather. A tarmac employee struck by lightning on the job throws quite the wrench in productivity as well. 

2. Decreased Morale

Workplace conditions have a direct impact on employee morale. Workers who feel valued and safe in their environment are more likely to be engaged and motivated. But if a company’s facilities send a message that they don’t give a flying flip about their employees’ well-being, that leads to workforce disengagement, frustration, and lack of enthusiasm. Over time, this decreased morale can manifest in lower quality work, increased absences, or even obstinance against company policies. 

3. High Turnover

Unsafe and unpleasant work environments lead to low retention. On average, the cost to replace an employee is 33% of their annual salary. Advertising the job, conducting interviews, onboarding training, and lost productivity add up quickly. If a manufacturing employee who makes $45,000 a year quits for an opportunity at a facility that treats its workers better, their employer can expect to lose about $15,000 just to replace them. If a company has chronic turnover, they’ll bleed money trying to replace their workforce. 

4. Company Reputation

Companies only have so much control over their public perception. Social media, online forums and anonymous employer review sites like glassdoor.com will air an organization’s dirty laundry freely. If a company is known for frequent safety incidents, high turnover, or employee neglect, their negative reputation will have long-lasting consequences. It’ll be harder to find skilled workers willing to risk working in such an environment, and they’ll likely have to pay more to attract the right talent. Companies with poor reputations also face obstacles in their communities. It can be difficult to get clearance to break ground on a new site if the surrounding community is opposed to your business practices. 

5. Moral Responsibility

What’s the ROI of morality? Negligible, some company leaders might say. But we disagree. The American Society of Safety Professionals (ASSP) says it well:

“Ultimately, company executives must recognize that they have a duty to provide a safe and healthful workplace to those who work for the company or visit the worksite. It is unethical to risk someone’s life and health in order to save money. A sound safety and health management program can help companies fulfill their moral obligation.”

Companies that prioritize profits over people might save money in the short term, but at a significant human cost. Embracing a moral responsibility, on the other hand, fosters a culture of respect and care, which leads to a more resilient organization. 

If the future of a business is to include success and sustainability, giving employees safe facilities is a necessity. 

Interested in starting a modified container project? Reach out to our team at 512-231-1010 or email us at Sales@FalconStructures.com.