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Leveraging the Latest Sleep Science to Combat Employee Churn

20 June 2022

Leveraging the Latest Sleep Science to Combat Employee Churn

The surprising relationship between lost sleep and employee turnover, and how companies can intervene

Corporate nap pod trends1 aside, you don’t want employees sleeping on the job. But you do want employees sleeping for the job. The benefits of improved sleep for job performance are well-documented, but the role of sleep in employee retention is an emerging area of research that could have major implications for retaining employees.

Gallup’s latest report shows that sleep-deprived employees leave their jobs 54% more frequently than their well-rested counterparts.

And when an employee resigns, the employer shoulders a hefty replacement cost, about 6-9 months of their outgoing salary according to the Society for Human Resource Management.2

Here, we’ll examine how poor sleep impacts employees, how sleep loss leads to employee turnover, and how better sleep improves employee retention. We’ll show you how companies can leverage the power of sleep to reduce employee turnover… all without cutting hours or installing hammocks in the office.

The Problem of Poor Sleep in the Workforce, and the Problems it Generates

Most workers don’t get enough quality sleep — and everyone is worse off for it.

You already know that sleep is important, and that your employees would probably be better off if they got more of it. For decades, experts have stated that the amount and quality of sleep we get profoundly impacts our health, mood, and behavior. And you may not be surprised by how widespread sleep deprivation is in the workforce. The National Sleep Foundation recommends adults log 7-9 hours sleep per night,3 but the CDC reports that over one-third of the nation’s adults fall short of the recommended minimum.4 Since the pandemic, this number has only grown, with some researchers reporting that 50% of US adults5 do not get sufficient sleep.

Unfortunately, the latest research reveals an even worse outlook when it comes to sleep health in the workforce. Researchers now say that previous studies have underestimated the impact of poor sleep,6 and that sleep loss has larger and further-reaching impacts than previously thought. To understand the newest sleep science, and what it means for businesses, we’ll start by considering what sleep deprivation looks like in individuals and how those effects show up in the workplace.

It will likely come as no surprise that poorly-rested people are worse off than well-rested people on virtually every measure of physical and mental health. Physically, long-term sleep loss is associated with a host of ailments:7 weakened immunity, weight gain, injury, reduced physical activity, and chronic conditions like heart disease and diabetes. For employers, this translates to an uptick in the use of employer-sponsored healthcare and sick leave. The National Safety Council reports that businesses spend an additional $2,200 per year in increased healthcare costs and sick days for each employee with insomnia.8 Furthermore, studies show that the total additional cost of employees with insomnia born by both the insurer and the employer is $4,300 per employee per year, so for larger business that self-insurer the cost is even higher.9

Worse yet, poor sleep disrupts functioning in the brain even more profoundly than in the rest of the body. Just think of how hard it is to think clearly after a single night of tossing and turning. For decades, studies have shown that memory formation and retrieval, problem-solving, focus, decision-making, attention to detail, creativity, and other cognitive functions significantly decline10 without enough quality sleep. When employees don’t sleep enough, on-the-job errors and accidents skyrocket. In one study, sleepy workers were 70% more likely to be involved in physical accidents at work.11 And a 2019 experiment found that sleep-deprived employees12 were twice as likely to lose their place in a sequential task and had three times as many lapses in attention.

All that lost productivity adds up to lost revenue, costing employers $3,20013 annually per sleep-deprived employee. One clinical survey in The Journal of Occupational Medicine concluded that lack of sleep is responsible for three times as much lost productivity14 as any other cause. As science writer, Bronwyn Fryer, explains in her book, The Business of Sleep:15

"A good sleep policy is a smart business strategy. People think they’re saving time and being more productive by not sleeping, but in fact they are cutting their productivity drastically".

Like productivity, mental health depends on good sleep health. Studies consistently show that, in the short term, sleep loss leads to emotional volatility and vulnerability to stress.16 We now also know that ongoing sleep loss contributes to mental illnesses17 including depression and anxiety. The costs associated with mental health are high. Each employee experiencing mental distress costs their employer an average of $3,000 in health care services, $4,783 in lost productivity, and $5,733 in associated employee turnover costs.

If the direct-cost numbers are alarming, the complexity of the issue is even more so. Poor sleep can kick off a feedback loop in which exhaustion and irritability impede healthy behaviors like exercise, meditation, balanced eating, and moderation of alcohol. This, in turn, contributes to further problems with sleep — and compounds the cost to employers.

From Tossing and Turning to Job Turnover

How lack of sleep erodes workplace engagement and drives employee churn

Business leaders tend to lose sleep over their employee churn rate. But few employers would dream that sleep problems in their workforce contribute to employee turnover. That’s because sleep health influences how we act in the workplace, which in turn mediates job satisfaction, belonging, and morale.

Traditional HR wisdom attributes most turnover to a few key factors that routinely come up in exit interviews and independent studies. Some, such as compensation and career development, are dictated by the business and the market. But several factors that drive employees to job-search are human and interpersonal, such as culture fit, belonging, and work relationships. And, as we’ve seen, interpersonal problems are frequently attributable to sleep problems.

In one study,18 researchers presented 26 well-rested participants with a picture of a frustrating scenario and recorded their written responses, then repeated the process after a period of sleeplessness. After insufficient sleep, participants were more aggressive, more likely to blame others for problems, and less likely to seek conflict resolution through compromise.

Do these findings on social interaction translate to actual behavior in the office? Absolutely. In a 2009 study, respondents with sleep problems reported not only higher rates of errors and memory lapses at work, but also more antisocial behaviors in the workplace,19 including “avoidance of social interactions and impatience with coworkers.” And when one under-slept employee exhibits a pattern of hostility, the rest of the office is impacted. Studies have shown that both positive and negative effects are contagious, especially on subordinates.

Could negative workplace relationships harm employee retention? In a word, yes. Over 10% of employees in one survey report staying with their company in order to remain with a coworker they like, while 25% have resigned20 to escape a problematic colleague. When asked what behaviors they find most toxic in coworkers, respondents most frequently chose two behaviors associated with lack of sleep: aggression and blaming others. The relationship is clear: poor sleep significantly damages employees’ sense of belonging, engagement, work relationships, and job satisfaction.

But if the role of sleep in employee retention is significant, it’s also one that has remained mostly invisible to employers and employees. In general, sleep health simply doesn’t come up in hiring discussions or exit interviews. Yet it helps determine how we experience and value our jobs, and how committed to them we are.

One reason for this pattern is that when our perception is impaired by lack of sleep, we actually fail to perceive our own impairment! Studies have demonstrated that sleep deprived people underestimate their own degree of impairment21 across areas like judgment, problem solving, and reaction times. When tired employees experience a high rate of errors and frustrations, they will look for external, rather than internal, causes.

Thus, tired people who feel irritable and unfocused while at work will tend to believe they are irritable and disengaged because of work. An overly-stressed employee will attribute their anxiety to an unreasonable workload, rather than reduced stress resilience brought on by sleep deficit. And when employees see their job as the root of their dissatisfaction at work, it’s a matter of time before they begin job searching.

Several new studies on job satisfaction and perceived belonging support this interpretation of the subtle relationship between sleep loss and employee turnover. In one survey, insomnia was correlated with greater hostility and fatigue22 and with decreased feelings of joy and attention at work. Poor sleep was also correlated with low job satisfaction, particularly among those reporting more negative feelings. The people most disgruntled by experiencing sleep loss, in other words, were most likely to be unhappy in their jobs.

Along with job satisfaction, under-slept employees have a lower sense of support from their company, and a lower sense of investment in their company’s success. One analysis of data from 5,000 employees23 showed that sleep-deprived employees felt as though they had less control at work, a significantly more demanding workload, and less social support than their peers. They also reported more negative attitudes about their workplace and higher levels of stress.

Evidence shows that such insomnia-driven negative perceptions about work lead directly to employee churn. A study of 320 business-to-business sales professionals24 found that increasing sleep dramatically increases an employee’s grit and decreases turnover intention. Brendt Scott, one of two lead researchers, expressed surprise at the magnitude of the effect that sleep had on employee retention and grit:

"It's intuitive that one might feel a little irritable [after poor sleep], but to experience emotional spillover to the point of actually feeling less satisfied with work is a little surprising. We know from other research that people who are dissatisfied with their jobs leave organizations at higher rates than those who are happy and committed to their jobs.”

Putting the Latest Science on Sleep to Work

How to improve employee sleep to improve employee retention

Knowing that this sleep/stress pattern tends to escalate, and eventually even drive employees away, businesses have every reason to look for ways to break the cycle. Other than shortening working hours or installing nap pods, what can businesses do to address employee sleep deprivation?

As it turns out, better employee retention through sleep improvement is possible through a fairly simple intervention. An evidence-based workplace wellness program that specifically targets sleep can significantly increase the quantity and quality of sleep among personnel. Better sleep, as we’ve seen, improves physical and mental health. For businesses, the reward is a workforce with better engagement, better attendance, better productivity, better team behavior, and better employee retention.

Employer-sponsored workplace wellness initiatives typically target fitness, diet, or stress management. Studies show that 70% of employees25 who enroll view such programs as an indication that they are valued by their organization. Employees participating in employer health programs report higher job satisfaction and lower turnover intentions. An effectively implemented and evidence-backed wellness program can control costs and churn - boosting employees’ sense of belonging and engagement, in turn raising their job commitment.

Existing wellness apps typically consist of sleep measurement tools, which allow employees to track their sleep patterns, or sleep induction tools, which help users transition into sleep. Notably, Chorus is the only integrative sleep app designed for organizations,28 serving both sleep improvement and sleep tracking functions. Like nutrition apps that offer both food logging and diet coaching, this combination of support and monitoring appears to have a synergistic effect.

Sleeping Well, Working Hard, and Staying on

Chorus Sleep as an employee benefit and employee retention tool

Businesses that care about productivity, attendance, safety, culture, controlling costs, and employee retention need to wake up to the hidden issue that’s hurting their bottom line: employee sleep loss. In The Business of Sleep,29 science writer, Viki Culpin, directly addresses business leaders about the urgency of taking action, especially in today’s job market:

“Managers and HR professionals must take note. At a time when leaders and employees are operating in rapidly changing environments with no ‘blueprint’ of how to do things, this issue needs to be taken seriously.”

When employees sleep badly (and over half of them do!), their performance and attitude at work take a hit. Poorly-rested employees are highly prone to costly mistakes, acute and chronic illness, and disruptive outbursts. Worse yet, under-slept employees tend to develop a negative view of their workplace, lower job satisfaction, and higher turnover intentions. It’s impossible to tease out and quantify the extent to which poor sleep drives resignation, partly because people lack insight around the physiological factors that influence their state of mind. But studies show that sleep is a factor in job turnover, and one that businesses must take seriously.

To break the cycle, the most obvious solution for employers is a sleep-oriented corporate-sponsored wellness program. While scheduled siestas and nap suites aren’t feasible for most offices, giving employees access to sleep-improvement tech is a cost-effective and easy-to-implement solution.

Among the most prominent leaders, cutting sleep to work longer hours has fallen decisively out of favor. Celebrity CEOs like Bill Gates, Sheryl Sandberg, Arianna Huffington, Oprah Winfrey, and Jeff Bezos advocate sound sleep habits for solid leadership. Now, evidence is revealing just how important sleep health is for rank-and-file employees, especially in terms of productivity and retention. With churn rates at a record high, businesses have more reason than ever to take decisive action to improve employee sleep health.

About Chorus

Chorus is an HR insights platform with two components for an integrated approach:

  1. The Employee side, a mobile app and coaching program that helps employees and their families sleep better.
  2. The Employer side, an aggregated and anonymized insights dashboard that gives leaders an improved understanding of employees wellbeing.

🧩 If you're an HR or business leader interested in learning more about supporting your organization, please reach out!


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