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Up in smoke: How employee tobacco use impacts your business costs

By David S. Utley February 09, 2023, 9:00 a.m. EST 5 Min Read

Inflation affects everyone. Our economy continues to be unpredictable, causing people and businesses to evaluate spending habits. Focusing on business decisions that provide cost savings and create a positive impact is more critical now than ever. One easily overlooked line item is employee tobacco use. When employees use tobacco, it negatively impacts their personal bottom line as well as your business. Does your benefits program effectively address tobacco use, and how much money would a successful quit program save your company?

The true cost of tobacco
In the U.S., a pack of cigarettes now averages $8. That pack-a-day habit costs people who smoke nearly $3,000 a year. The lifetime cost of smoking is in the ballpark of a quarter million dollars today and will only grow higher in the coming years. This figure doesn't include medical expenses from tobacco-related illnesses.

According to the CDC, cigarette smoking is the U.S.'s leading cause of preventable death. Cigarette smoking causes more than 480,000 deaths yearly in the U.S. — nearly one in five. It's common knowledge that quitting all forms of tobacco makes sense, especially as we encounter and work to navigate things like inflation and the potential of a recession.

Tobacco use is costly for workplaces too. Health concerns top the list, which results in absenteeism and presenteeism (more on that below). While this is a crucial concern, it misses tobacco's other workplace impacts, especially lost worker productivity and lower performance output. When employees use tobacco, it ripples into every part of a business, negatively affecting the company's bottom line.

Tobacco thwarts productivity
A meta-review from 2020 shares that across 33 studies on smoking and sickness absence, people who smoke averaged a 31% higher rate of sick leave compared to those who do not smoke, even after factoring in gender, age, and occupation. "We found robust evidence showing that smoking increases both the risk and number of sickness absence days," the authors wrote.

Absenteeism is only one cost employers face from tobacco use. Presenteeism, or lost productivity when workers are on the job but are less effective due to poor health, is expensive. And the primary cause of presenteeism? Tobacco use. A 2020 study of over 60,000 workers found that heavy smoking was one of only two factors "significantly related" to increased presenteeism, with the other being high alcohol consumption.

Combined, smoke breaks, absenteeism, and presenteeism increase business costs exponentially. Where absenteeism piles productivity loss into days of missed work, presenteeism sprinkles this loss in increments throughout every workday, like smoke breaks.

Businesses pay a high price when their employees use tobacco. A 2013 study compared the estimated excess cost of tobacco use per tobacco-using employee at $5,816 per year more than a non-smoking employee. This figure factors in everything from absenteeism to higher healthcare costs. Adjusted for inflation, that's nearly $8,000 in 2022. Expect that number to continue increasing as inflation rises and employee tobacco use remains prevalent.

Cigarette smoking costs U.S. businesses nearly $185 billion in lost productivity from smoking-related illnesses and health conditions, $180 billion in lost productivity from smoking-related premature death, and $7 billion in lost productivity from premature death from secondhand smoke exposure each year. Just like the smoke it produces, tobacco use seeps into nearly every cost center of a business, including many we don't think about, like property insurance. The Centers for Disease Control noted in a 2020 report that fire insurance costs drop by 25-30% when a workplace goes smoke-free. They also mention added expenses from cleaning and liability risks from secondhand smoke.

Helping employees quit tobacco is good for business
Investing in a solution to help your employees quit tobacco makes sense in this uncertain economy. If your business doesn't offer this benefit, now is the time to start. If you already provide a tobacco cessation solution, evaluate if it's the right solution needed to increase employee success, whether they're looking simply to track, reduce, or quit tobacco.

Quitting is hard, taking most people as many as 30 or more attempts before they become successful. That's why choosing an effective cessation program for your employees is essential to make quitting more likely and save everyone money. Finding the right solution takes a little research, and some programs work better than others.

Here are some things to consider when investing in tobacco cessation for your business:

Look for solutions that have proven and documented success.
Choose a solution that offers one-on-one, personalized expert coaching.
Find solutions that include biofeedback options, like a Breath Sensor that measures carbon monoxide levels in exhaled breath.
Make sure the solution offers access to helpful self-paced tools that work better to support the unique journey of every person who uses tobacco.
Ensure the solution offers user-friendly options like online access and a mobile app.

Once you've selected the most effective solution, ensure employees know it's available so they can use it. Any cessation program worth considering will have marketing support that can increase enrollment and engagement as well as robust reporting, removing additional work needed to market such a benefit offering and report on program success.

So while we can't control everything that happens in the economy, we can make inflation a little less painful by helping employees quit all forms of tobacco. A healthier workforce helps your bottom line, and healthier employees lead better lives (and even save in the long run). Everyone wins when employees quit using tobacco.

David S. Utley

Founder and CEO, Pivot