The High Cost of Burnout: Why Organizations Can’t Afford to Ignore It

It’s Monday morning. Your star employee is late again. They’ve been quieter in meetings, slower on deadlines, and more irritable with coworkers. You assume they’re just going through a rough patch—but what you don’t see is the ripple effect their burnout is having across your team, and your bottom line.

Burnout isn’t just an individual problem—it’s an organizational one. And while it may seem like only a small portion of your workforce is affected, research shows otherwise.

Burnout by the Numbers

According to Christina Maslach, one of the leading researchers on the topic, 10–15% of employees meet the full criteria for burnout, and up to 50% are somewhere on the continuum (Maslach & Jackson, 1981).

A recent study quantified the annual costs of employee disengagement and burnout (Martinez et al., 2025):

• $3,999 per nonmanagerial hourly employee
  
  
• $4,257 per nonmanagerial salaried employee
  
  
• $10,824 per manager
  
  
• $20,683 per executive

For a 1,000-person company, this adds up to over $5 million annually—plus significant losses in quality-adjusted life years.

And the impact isn’t limited to large employers:

• 500 employees = $2.52 million
  
  
• 100 employees = $504,000

Even small and mid-sized organizations face major financial risk.

Why Burnout Costs So Much

Burnout drains organizations through:

• Absenteeism – More sick days and personal leave
  
  
• Presenteeism – Employees are present but disengaged
  
  
• Turnover – Departures erode institutional knowledge not to mention replacement costs
  
  
• Errors and accidents – Fatigue increases mistakes
  
  
• Lower creativity and innovation – Exhaustion limits problem-solving
  
  

The U.S. Department of Labor (OSHA) reports that for every $1 invested in employee well-being, organizations see a $4 return in productivity and retention (U.S. Department of Labor, n.d.). Prevention isn’t just ethical—it’s profitable.

The Human Side of the Numbers

From a leadership perspective, burned-out employees are often mislabeled as “problem employees.” They may be cynical, pessimistic, disengaged, and absent more often. Some seek validation by criticizing leadership or spreading gossip, which can quickly erode team morale.

Burnout isn’t contagious like a virus, but disengagement and frustration do spread. Left unchecked, one burned-out employee can impact an entire team.

Understanding the Burnout Continuum

Burnout exists on a spectrum, not as a simple yes-or-no diagnosis (Maslach & Jackson, 1981).

• Mild: fatigue, irritability, subtle withdrawal
  
  
• Moderate: cynicism, difficulty concentrating, more sick days
  
  
• Severe: exhaustion, conflict, serious health issues, disengagement

Early detection is critical. Interventions are more effective—and less costly—when burnout is caught before it becomes severe.

Burnout Is Not a Permanent State

The good news? Burnout is preventable and reversible (Maslach & Jackson, 1981). With the right awareness and tools, supervisors can intervene effectively.

In health and human services especially, burnout often stems not only from workload or inefficiencies but also from secondary trauma and vicarious stress—the emotional toll of being repeatedly exposed to others’ pain and crises. Over time, this constant exposure can erode employees’ physical, mental, and emotional health if left unaddressed.

Effective strategies may include:

• Offering a break or adjusting tasks
  
  
• Fixing workflow inefficiencies
  
  
• Addressing interpersonal conflict
  
  
• Providing more autonomy and flexibility
  
  
• Recognizing contributions
  
  
• Creating trauma-informed supports, such as reflective supervision, access to therapy, and time for restorative practices like mindfulness or yoga
  
  

Even simple steps—like a supervisor normalizing conversations about secondary trauma—help employees feel supported and capable of sustaining their work long term.

📌 What Is Secondary Trauma?

Secondary trauma—sometimes called vicarious trauma—occurs when employees absorb the emotional impact of hearing about or witnessing others’ suffering. It’s common in professions like child welfare, healthcare, emergency response, and victim services. Over time, this exposure can mirror the symptoms of direct trauma, leading to exhaustion, cynicism, health problems, and eventually burnout if not addressed.

Spotting Burnout Early

Proactive leaders can identify burnout before it derails performance. Warning signs include:

• Recent exposure to high stress or trauma content
  
  
• Declining work quality or productivity
  
  
• Absenteeism or lateness
  
  
• Withdrawal from peers
  
  
• Frequent complaints about workload
  
  
• Mood changes such as irritability or pessimism
  
  

Tools like regular burnout surveys, opportunities for authentic connections, and trauma informed problem solving conversations make early detection possible.

Case in Point: Intervening in Time

In human services:
A care manager, usually upbeat, became short with clients and withdrawn from team discussions. Instead of reprimanding her, the supervisor held a check-in. She revealed new manual processes were overwhelming her. The supervisor automated tasks and eased productivity requirements. Her performance and morale quickly rebounded, preventing turnover.

In child welfare:
A case manager began missing deadlines and seemed increasingly disengaged in meetings. Her supervisor recognized these as signs of burnout and invited her to reflect on the impact of secondary trauma. Together, they explored how repeated exposure to difficult cases was affecting her physical, mental, and emotional health. They developed a self-care plan that included flexible scheduling to attend therapy, increased supervision for support, and weekly yoga sessions. Within weeks, she reported feeling more grounded, engaged, and able to manage the demands of the work.

In healthcare:
An emergency department nurse began making errors and calling in sick. A manager discovered she was working double shifts due to staff shortages. They reduced her overtime, arranged peer support, and granted two mental health days. Within two months, her performance and commitment returned.

These examples show how timely, targeted interventions—whether addressing workload, trauma exposure, or staffing—can reverse burnout and restore productivity.

The Leadership Imperative

Preventing burnout doesn’t require overhauling an entire culture overnight. It starts with leaders who are willing to see burnout not as a flaw in the employee but as a signal from the workplace.

Organizations that listen to that signal—spotting signs early, addressing root causes, and supporting employees—will see higher engagement, stronger retention, and better overall performance.

The question for leaders is simple:
Will you dismiss burnout as an individual weakness, or recognize it as an organizational responsibility? The choice you make could save millions, retain your best talent, and protect the health of your workforce.

References

Martinez, M. F., O’Shea, K. J., Kern, M. C., Chin, K. L., Dinh, J. V., Bartsch, S. M., Weatherwax, C., Velmurugan, K., Heneghan, J. L., Moran, T. H., Scannell, S. A., John, D. C., Shah, T. D., Petruccelli, S. A., White, C., Dibbs, A. M., & Lee, B. Y. (2025). The health and economic burden of employee burnout to U.S. employers. American Journal of Preventive Medicine, 68(4), 645–655. https://doi.org/10.1016/j.amepre.2025.01.011

Maslach, C., & Jackson, S. E. (1981). The measurement of experienced burnout. Journal of Occupational Behaviour, 2(2), 99–113. https://doi.org/10.1002/job.4030020205

U.S. Department of Labor, Occupational Safety and Health Administration. (n.d.). Workplace stress. Occupational Safety and Health Administration. https://www.osha.gov/workplace-stress