Paying the price

Canada’s mental health crisis is costing the economy an estimated $180 billion a year — and employers are shouldering most of the burden

WE GOT A new accounting on the cost of workplace mental health in Canada last week, with the release of a new report from the CSA Group’s Public Policy Centre. According to the report, which claims to be the most comprehensive costing to date, Canada’s mental health crisis is costing the country $180 billion every year, with employers absorbing $110 billion of those costs.

Click here to view this article in the London Inc. Worklife newsletter

The dollar amounts attached to Canadian mental health has jumped substantially over the past two decades, the researchers warned. The previous benchmark figure often used came from the Mental Health Commission of Canada, which pegged the cost at $50 billion in 2011 dollars (around $67 billion in 2026), suggesting the costs paid have tripled. (The researchers also believe that even this is likely to be an underestimation, stemming from gaps in the data.)

Story Continues Below

 

What might alarm businesses is the interpretation by lead author Olga Morawczynski that employers are shouldering almost all the downstream costs — so much so that she called employers “the single largest payer for poor mental health in the country.”

The estimated $110 billion in costs borne by employers each year, the authors suggest, is largely made up of reactive costs: “disability leave, turnover, overtime, legal costs and investigations,” Morawczynski said. It might seem especially burdensome compared to public funding for mental health care, which amounted to just $23 billion in 2024.

“While the relationship is complex, mental health challenges are one of several factors that may contribute to workforce performance as nearly one in three Canadian workers report that their performance is directly affected by mental health challenges,” the report states. “At scale, this erosion of workforce effectiveness may be connected to Canada’s broader productivity problem and warrants closer examination.”

Story Continues Below

 

Workplaces and human resources departments can only do so much to combat a society-wide mental health crisis, but Morawczynski suggests firms can do something. For one, they can look at the data suggesting that only 14 per cent of the spending is done proactively (the rest being after-the-fact reactive spending) and start to shift the balance.

“It doesn’t have to be expensive or a crazy process,” said Morawczynski. “I did not find that a lot of organizations really invest in training their leaders around mental health and ensuring their leaders know how to support employees. A lot of them didn’t know exactly what types of resources companies were paying for.” Kieran Delamont