Rising rates of mental health disorders driven by the pandemic could cost the economy $7.4 billion, and that’s just in New South Wales.
Mental health and depression issues among workers as a result of the COVID-19 pandemic could cost the New South Wales economy alone up to $7.4 billion by 2025.
In 2021, 21% more people in New South Wales experienced mental health issues, according to a report titled Aftershock: Addressing the Economic and Social Costs of the Pandemic and Natural Disasters.
The Impact Economics and Policy report was commissioned by a range of leading social bodies, including the NSW Council of Social Service (NCOSS) and the Mental Health Coordinating Council.
The estimate of economic loss is based on reduced worker productivity, driven by higher rates of depression and anxiety.
NCOSS CEO Joanna Quilty said the research underscores the devastating impact this uncertain and difficult time has had on the mental health of people across the state. She also pointed out that the projected economic loss is conservative, as there were already significant economic and social costs associated with mental health before the COVID-19 pandemic, exacerbated by a series of natural disasters.
“Before COVID, the Productivity Commission estimated the direct costs to the Australian economy of poor mental health at between $40 billion and $70 billion each year,” Quilty said.
“But we know that people’s mental health has deteriorated as a result of prolonged shutdowns across our state and it’s women with young children who have been hit the hardest. On top of that, natural disasters have since added to the picture of growing psychological distress in NSW communities.
“For those who are working, worsening mental health can mean increased absenteeism or showing up to work but not being as productive due to feelings of anxiety or depression.”
Mental Health Coordinating Council CEO Carmel Tebbutt also pointed out that specific cohorts have been more significantly impacted by the pandemic and natural disasters in recent years.
“The psychological effects of a disaster are most drastic in children, women and dependent elderly people – these are the most vulnerable populations and should therefore be the focus of interventions,” Ms Tebbutt said.
“Women aged 16 to 24 already have the highest prevalence of poor mental health in New South Wales and are twice as likely to develop post-traumatic stress disorder.
“People with disabilities are four times more likely than people without disabilities to experience high levels of psychological distress and are up to four times more likely to die in a natural disaster.
“COVID has also had a disproportionate impact on people with disabilities, due to lack of access to vaccines and disruptions to usual services and supports.”
Leading bodies are urging the NSW government to meet the urgent need through a range of targeted investments.