The economic impact of poor mental health among Maltese workers

Abstract

The issue of mental health is a global concern, and Malta is no exception. Studies have concluded that individuals with poor mental health may limit their investment in human capital and degrade their natural ability, restricting their performance, increasing absenteeism, and consequently diminishing productivity. Consequently, the aim of this dissertation is to measure the economic cost resulting from sickness absence from work caused by poor mental health in Malta. This is done by first examining the extent of the relationship between poor mental health and sickness absence from work. Based on secondary data, this dissertation utilises case-based cross-sectional data covering the period of 2019/20 to establish and quantify the economic impact of poor mental on absenteeism in Malta. Negative Binomial regression analysis was employed because the data in question compromises count data. This study found that the total economic cost for individuals with poor mental health who were absent from work due to their mental health issues in Malta is €6.5 million. This was based on a range of assumptions. These include that the cost of absence is equivalent to the average wage, all individuals have the same level of productivity and all workers who suffer from poor mental health work as full-timers. This research contributed to the advancement of policies designed to enhance educational attainment among individuals. It underscores the importance of early intervention, as it holds the potential to positively influence long-term mental health outcomes and mitigate the adverse effects of absenteeism in Malta.