SMEs Facing Post-Pandemic Morale Epidemic as Workforce Anxiety Rises

A recent survey conducted by the employment team at law firm, Moore Barlow, found that performance issues and levels of absence are among a wide range of warning signs on the rise with the same common contributors: stress, anxiety, and depression. This is yet more proof of a worrying trend that extends beyond the aforementioned survey, and it’s disproportionately affecting SMEs.

Just as we begin to feel like we’re learning to live alongside Covid-19, the mental health trauma the pandemic has inflicted is leaving a sombre trail in its wake. Work-related stress, anxiety, and depression don’t go away when you step back into the office after a year of remote work. Some things are not so simply undone, and that it’s manifesting as a low morale epidemic that’s sweeping across industries.  

Moore Barlow found that four in ten businesses noticed an increase in performance issues, alongside a reluctance to return to the office (36%) and growing levels of absence (33%).  

This is supported by the UK government Labour Force Survey from 2021 that states over 50% of cases of workforce illness in 2021 were due to either stress, anxiety, or depression. In this same survey, the number of cases per 100,000 workers rose notably in 2019 to a new “plateau” between 2020 and 2021 of 2,480. That the Covid pandemic has contributed to this correlation is validated by the fact that over 50% of the respondents to this survey confirmed that the pandemic had worsened their overall mental health (449,000/882,000).  

SMEs Bearing the Brunt

A fly in a swimming pool makes a negligible difference. It stops nobody from swimming, going entirely unnoticed. That same fly in a glass of water compromises every H2O molecule in its vicinity. This is how SMEs are being disproportionately affected by the mental strains of pandemic life. 

In a separate survey, The Guardian also report that 51% of people revealed they felt obligated to “put on a brave face” at work, combining with an under-diagnosed mental health epidemic to create deeply unideal conditions for productive collaborative work.  

SMEs are smaller ponds where negatively charged environments are bound to have more profound impacts. They also don’t provide the same peace of mind in times of crisis, being more susceptible to external market forces and disruptions, causing employees to be on edge as they worry about their livelihoods.  

That’s before mentioning the impact of absences. Following the same logic, SMEs don’t have the luxury of 20-people strong departments full of employees who can pick up the slack. Often, one or two people will hold responsibilities of entire teams at large corporations, and when one of them has a severe case of Covid or needs extended time off to look after their mental health, it can derail key business functions.  

We need to see a quantifiable, significant step-up in the amount of investment companies make in employee wellbeing strategies so that employees are supported to overcome the struggles that they’ve faced throughout the pandemic.

Harry Bliss
CEO, Champion Health


Gloom from the Top 

Taking that into account, the owners of SMEs are, understandably, at their wits’ end. A 2022 Capital One Survey reports that small business owners’ mental health has been tested by two years of pandemic disruptions, struggling to maintain a healthy work-life balance, and the knock-on effects of the Great Resignation.  

Of those surveyed, over a quarter said they experienced almost constant mental exhaustion, with 42% saying they had experienced burnout since the pandemic began. While the conditions that created this problem are easing with Covid restrictions being pulled back around most of the world, there is a real risk of another variant laying all SME owners’ best-laid 2022 plans to waste.

Mental Health is Wealth

What SMEs and business in general need to do is plan for the future of their business’s mental health.  

It’s not a one size fits all approach, but as Katherine Maxwell, Partner and Head of Employment Law at Moore Barlow says, “firms are looking in the right places for solutions – improving their offering to employees and introducing better wellbeing support – but they should think about their processes and procedures too.” 

Harry Bliss, CEO of Champion Health called the results of his own company’s workplace health report “a wake-up call,” for businesses, saying that “We need to see a quantifiable, significant step-up in the amount of investment companies make in employee wellbeing strategies so that employees are supported to overcome the struggles that they’ve faced throughout the pandemic.” 

That’s Our Time 

Knowing what we do, the onus is on SMEs to do all they can to maintain the mental wellbeing of their staff. While not everyone may be able to invest heavily in software or implement initiatives that keep the entire workforce engaged, something as small as asking how your employees are doing could be the catalyst for a positive trend.  

Rachelle Suff, the senior employment relations adviser at the CIPD, advises prevention as the best cure, saying that “crucial to this proactive approach is training managers to identify potential causes of stress and ensuring they are effective at managing people.”  

While it’s not easy to talk about, easy to empathise, or easy to solve, doing nothing to address mental health has far worse consequences for SMEs than doing absolutely anything.