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Why should small business owners invest in mental health?

Published September 26, 2022 (last updated on May 15, 2024) | Adam Wyatt - Copywriter and Content Creator


It is hard running a business. Managing employees, recruitment, onboarding, ensuring compliance, and health and safety are some of the challenges for small business owners. And this was before you consider one of the greatest sociocultural disruptions to the workplace and the workforce. Coupled with existing complications, they must deal with ongoing social and political disruptions, labour shortages, and rising expenses.

These challenges have had an impact on small businesses and employers. According to a survey, 36% of small business owners in New Zealand believe managing employee processes and compliance is taxing on their mental health.

Mental Health Awareness Week (MHAW) is taking place on 26 September- 2 October, and it is an important opportunity for small business owners across New Zealand to take stock and introspect. It also highlights the need for small business owners to invest in mental health.

Small business owners battling on all fronts

For small business owners, the last two years have been a battle on all fronts. The pandemic forced businesses to go into extended periods of lockdowns. Combined with a long border closure and prolonged periods of illnesses, employers are struggling to stay afloat. In the survey mentioned above, 43% of employers commented that labour shortages remain their biggest hurdle so far. According to small business owners and employers, it takes about four months for new employees to get up to speed and to reach full productivity. This eats into time that small businesses do not have or can afford.

Small business owners have reduced opening hours or cut back staff just to keep their business running over the last 12 months. The lack of available and skilled labour is raising further concerns among small business owners to retain staff. 19% of small business owners are worried about retaining staff. They are scrambling to ensure that existing staff stay committed and feel motivated to do their jobs. The shrinking pool of employees is finding itself overworked and exhausted to keep businesses running.

In July 2022, New Zealand’s inflation rate hit a 30-year high of 7.3% with the country facing a cost-of-living crisis and essential items becoming increasingly unaffordable. This will have a knock-on effect on costs of services and running a business. If people are forced to cut down costs, small businesses will have to brace themselves for lower foot traffic and consumer activity.

Employee concerns and insights

Amidst trying to put out multiple fires, employers also must protect their team and workplace. 61% of employees are concerned about their personal health and wellbeing. Caught between a desire to balance their work and life, employees are also seeking a supportive workplace and management. 47% of employees said flexible working was a valuable aspect while 65% ranked supportive management as the most important factor in an employer.

Small business owners are solely responsible for managing the wellbeing of their employees. This can put a strain on their time and resources, causing them to act reactively, trust their instinct, and manage issues as they arise. The strategy of tackling problems when they arise can create a lack of clarity and trust at the workplace.

Impact on Māori small business owners

The BDO Wellbeing in Business Index- BDO  Te Rangahau o ngā hauora pai found that Māori small business owners were disproportionately affected by the pandemic. Lack of support, resources, and training have led to 51% of Māori business leaders feeling less mentally healthy than normal.

There is an available pool of talent, but the missing resources and opportunities can create uncertainty among Māori business owners.

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Investing in mental health

Mental health or wellbeing at the workplace should not be an afterthought. From the numbers mentioned above, it is evident that business owners and employees are impacted severely. It is the need of the hour to invest in mental health. Research has shown that talking about mental health at work can lead to engaged and healthy workplaces. Investing in mental health means creating an inclusive and supporting workplace. It is about inculcating the right values and beliefs.

  • Its okay to not be okay- Talking openly and honestly about mental health at the workplace helps reduce stigma and breaks down barriers. If you encourage employees to be transparent and honest, you make it easier for them to access support. Mental Health Awareness Week (MHAW) is a good time for you to start the conversation.

  • Lead the charge- Small business owners can lead the charge by speaking about mental health at work. Let your staff know that your door is always open to them. Host informal team events such as coffee catchups or lunches, where they can chat freely. Put up posters and informative materials around the workplace directing staff to resources.  

  • Be inclusive- Inclusion is about making everyone feel valued and heard. Inclusive teams and workplaces are linked to better mental health. Does every employee have a right to voice an opinion?

  • Be mindful- Mental health is a complicated spectrum. It can be tricky for you to offer advice or guidance unless you are a qualified professional. Generic advice can also seem belittling to someone going through significant issues. Be mindful of your words and how you tackle issues. The best response is often to acknowledge that you are listening and direct them to a qualified medical professional that can support them.

Importance of right processes and documentation

New Zealand’s complex industrial relations laws are confusing to navigate, complicating the daily operations of small businesses. For example, employers have often found the Holiday Act 2003 complicated. The New Zealand Government has recently accepted a taskforce recommendation to make the Act clearer for employers and business owners. A whopping 48% of business owners said in a survey that managing employees in an ever-changing regulatory environment is stressful and confusing. 29% of business owners are worried that staff will be paid incorrectly due to confusing payroll legislation.

Small business owners need to delegate implementing right processes and documentation to the experts. Employsure has worked with over 30,000 businesses across Australia and New Zealand. We take the stress away by helping you with employment relations and workplace health and safety. By working with us, you can have the peace of mind to focus on running your business. Call our 24/7 Advice line today!

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