I work primarily in the fields of employee engagement and change management so for the last 10 years or more I have been watching a couple of things that we only seem to be recently recognizing as threats to our economy.

The first is the exponentially increasing costs of delivering health care. In 2010 it is estimated that 12% of GDP (gross domestic product) will be spent on delivering health care. At current rates that is expected to climb to over 16% by 2020. There are a couple of things about that that should be concerning you:

• For all we spend our outcomes aren’t very spectacular. Our “quality” of health care is well in the middle of the pack. At the top end we deliver very good care and it is very accessible, if you are on a good plan and insured. The “median” level of care is pretty pedestrian.
• We aren’t addressing (in my opinion) the right things. My research tells me that 60% of health related costs are preventable by the individual. That means they are related to lifestyle or environment. The “solutions” on the table focus on delivery and “access” not root causes.
• The escalating costs of health care and retirement have created a financial crisis, in the public sector at least. There are a number of states, counties, and municipalities that are essentially at or close to insolvency with the costs of health care and retirement programs representing one of their most significant expenditures. In many cases these “entitlements” are built into collective bargaining agreements and so we are not engaging in discussions about the “brokenness” of the system. We just reduce staff or cut services to meet the contractual obligations.

I don’t think we can sustain that….

The second area is what I believe is a productivity crisis in large part based on how we interact with one another. Much of the relationship between employer and employed is at best transactional, at worst adversarial.

• A study by TowersWatson found that the number of employees who would describe themselves as “highly engaged” is at historical lows- 21%. This represents a 30% decrease from 2009.
• Lack of engagement shows up in a myriad of ways like lost productivity from absenteeism, “presenteeism”, turnover and other phenomenon. Studies say presenteeism accounts for a $200 billion annual productivity “bleed” to our economy in the U.S. alone. Turnover cost $5 trillion.
• The stock market is up, but we see only marginal growth in employment. This ties back to the health care issue. Studies say that “behavioral health” issues related to stress, depression, and other factors are costing the economy another 4 to 6% productivity drain that doesn’t show up in direct medical or health care related spending.

So you might be asking yourself “what’s your point?” My point is that a critical factor in sustaining an enterprise of any kind is having people available with the right skills and the right commitment to meet the organizations objectives. Especially employees who are focused on the objectives of the enterprise- not stresses at home or at work.

One of the things that draws me to the sustainability movement is its encouragement to look at things from a systemic and integrated perspective rather than in isolation. I think that we need that same integrated and systemic perspective as we look at how we interact with people and our society.

The issues that I mention while challenging are not insurmountable; in fact many of the “barriers” can be addressed through collaboration and communication, just like sustainability.

I consider the human capacity represented by the collective knowledge, skills, abilities, and engagement of people to be one of our most precious and critical natural resources. Like other natural resources we need to cultivate it and nurture it, not just exhaust it. That is why I use the term human capacity rather than human capital, which candidly I can’t stand.

So when you are looking at your sustainability initiatives don’t forget to include human capacity…

About the Author
Mark F. Herbert is a speaker, author and consultant with over thirty years of experience helping organizations like Honeywell, SpectraPhysics, Mobius, Oregon Community Credit Union and others take their organizations from Compliance to Commitment™. He is currently a principal at the consulting firm of New Paradigms LLC. He recently published his book Managing Whole, One Man’s Journey, which is available at amazon.com or his website at www.NewParadigmsllc.com.