How can effective safety management actually save money?

Workplace safety has become a key concern for most organizations, and for good reason. For the worker, the benefits of working in a safe environment is obvious – workplace accidents or occupational accidents can lead to irreversible consequences that directly affect the worker’s quality of life. For the employer, effective safety management can be seen as an investment to increase productivity and reduce accidents and injuries. As an investment, savings are earned from the prevention of injuries and accidents. Having a strong safety culture not only promotes a healthy environment that helps motivate workers, but also saves money by avoiding preventable costs.

Work injury costs
Injuries are expensive, and the reality is that injuries can occur when occupational risks and hazards are not averted in the workplace. In 2017, the National Safety Council (NSC) estimates the total cost of work injuries to be $161.5 billion. Estimates provided are comprised of wage and productivity losses, medical expenses, administrative expenses, motor vehicle property damage, and employer costs. Further, the cost per medically consulted injury was estimated to be $39,000 while the cost per fatality was $1.15 million.

In terms of losses in operating time, the NSC estimates 70 million days lost due to injuries within the same year.

Savings through safety 
Given an illustration of the expenses incurred by injuries, the importance of safety management and safety culture as an investment is highlighted. While returns are not always explicit, and might not be felt immediately, there are key areas where savings can be realized:

  • Insurance premiums
    Insurance premiums are greatly affected by the historical safety performance of an organization. More occurrences of injuries would translate to higher premiums.
  • Worker replacement costs
    Aside from the direct costs of the loss of a worker due to an injury, replacements and substitutes to cover for the loss would also incur costs. Additional training for replacements, and possibly overtime hours to cover the increased load would add to the expenses shouldered by the employer.
  • Loss of productivity
    Accidents and injuries cause downtime. It takes time to complete investigations and root cause analysis procedures at the event of a serious accident. This period of inactivity can translate to a halt in operations, and therefore a loss of productivity.

Want to keep reading?

Tips on Safety Maintenance: Keeping Your Crew and Machinery Safe

Maintenance work differs greatly from day-to-day operations—every task is unique, and there is typically little room for automation.
View Article

Should technicians get maintenance safety certifications?

Safety should be the primary concern for maintenance technicians - they are the employees who place themselves in dangerous situations
View Article

5 Tips for Forklift Maintenance and Safety

Here are the top five tips for maintaining your forklifts and overall safety, including inspecting your forklifts daily, checking the tires, and more.
View Article

4,000+ COMPANIES RELY ON ASSET OPERATIONS MANAGEMENT

Leading the Way to a Better Future for Maintenance and Reliability

Your asset and equipment data doesn't belong in a silo. UpKeep makes it simple to see where everything stands, all in one place. That means less guesswork and more time to focus on what matters.

Capterra Shortlist 2021
IDC CMMS Leader 2021
[Review Badge] GetApp CMMS 2022 (Dark)
[Review Badge] Gartner Peer Insights (Dark)
G2 Leader