Why 2025 means a battle to protect employee mental health

Why 2025 means a battle to protect employee mental health

Employers of all shapes and sizes are looking at how to adapt to an age of higher taxes in the wake of October’s budget announcement on National Insurance — and looking to what can be trimmed from costs.

Business confidence has been shaken. The CBI’s Growth Indicator points to a 10% fall in activity up to February 2025; the Institute of Directors has signalled the lowest level of confidence in the economy since the start of the Covid pandemic. In particular, intentions around investment in areas like recruitment have been significantly affected.

Leaner and meaner?

Evidence so far suggests employers plan to take immediate action: by limiting wage increases, raising prices and job cuts. Most organisations plan to introduce a raft of measures to offset higher NI contributions, including improving productivity.

More employers are expected to look at cost-cutting — as the more efficient way to protect EBITDA (earnings before interest, taxes, depreciation and amortisation) — meaning scrutiny of any expenditure on benefits and activities considered to be not ‘mission critical’.

Certain ROI

EAPA UK chair, Karl Bennett said: “There are some fundamental contradictions here. Most of all the government wants growth, based on improved productivity and getting a much larger proportion of the economically inactive back into the workplace: young people, the disabled and those who have been long-term sick. This can only happen with healthy, supportive workplace cultures.

“So, more than ever, it’s a case of what’s most effective, focusing spend on the offerings that lead to a proven Return on Investment. With their emphasis on dealing with root issues, untangling the combinations of worries and issues, and providing immediate access to professional support, EAPs have a long and obvious track record in terms of impact and ROI. The most recent data shows that for every £1.00 spent on an EAP in the UK, employers have seen an average return on investment of £10.85.”