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The Actuary The magazine of the Institute & Faculty of Actuaries

Lack of sleep costing UK economy up to £40bn

A lack of sleep among UK workers is costing the economy up to £40bn a year, 1.86% of the country’s GDP, according to research by RAND Europe.

Effects of lack of sleep are 'massive' ©iStock
Effects of lack of sleep are 'massive' ©iStock

Their Why Sleep Matters – The Economic Cost of Insufficient Sleep study found that the UK loses just over 200,000 working days a year due to sleep deprivation among its workforce.

This causes productivity to fall through a combination of absenteeism and presenteeism, where employees are at work, but are working at a sub-optimal level.

The report’s main author, Marco Hafner, said: “Our study shows that the effects from a lack of sleep are massive.

“Sleep deprivation not only influences an individual's health and well-being but has a significant impact on a nation's economy, with lower productivity levels and a higher mortality risk among workers.”

The research is the first of its kind and studied the economic losses due to a lack of sleep among workers in five different OECD countries – The US, UK, Canada, Germany and Japan.

This involved using a large employer-employee data set and data on sleep duration to quantify the predicted economic effect from a sleep deprived workforce.

The economic costs found were:

•    US - £329bn – 2.28% of GDP – 1.2 million working days
•    Japan - £105bn – 2.92% of GDP – 600,000 working days
•    Germany - £48bn – 1.56% of GDP – 200,000 working days
•    UK - £40bn – 1.86% of GDP – 200,000 working days 
•    Canada - £17bn – 1.35% of GDP – 80,000 working days

“Improving individual sleep habits and duration has huge implications, with our research showing that simple changes can make a big difference,” Hafner continued.

“For example, if those who sleep under six hours a night increase their sleep to between six and seven hours a night, this could add £24 billion to the UK economy.”

In addition the report found that a person who sleeps on average less than six hours a night has a 13% higher risk of dying earlier than someone who sleeps between a ‘healthy’ seven and nine hours, while those sleeping between six and seven hours a day have a 7% higher mortality risk.

Source: RAND Europe
Source: RAND Europe
The report suggests that:

•    Employers should recognise the importance of sleep and the employer’s role in its promotion, provide facilities and amenities that help employees with seep hygiene, and discourage the extended use of electronic devices
•    Public authorities should support health professionals in providing sleep-related health, introduce later school starting times
•    Individuals should set a consistent wake-up time, limit the consumption of substances that could impair sleep quality, exercise, and limit the use of electronic devices.