Transform Workplace Mental Health with a Skills-Based Approach

Mental health is no longer a personal issue—it’s a workforce challenge. Nearly 1 in 4 U.S. adults (23%)—or almost 60 million Americans—experienced a mental illness in 2021-2022, according to a 2024 Mental Health America report.

Now, Generation Z—which already disproportionately reports experiencing mental health issues—has surpassed the share of Baby Boomers in the workforce. In the second quarter of 2024, Gen Z comprised nearly a fifth of the labor force (18%), according to the U.S. Department of Labor Employment and Training Administration. This shift means businesses must confront a new reality: The mental health crisis among young people threatens the ability of future workforce talent to flourish.

For leaders, the stakes couldn’t be higher: Failure to address these challenges risks reduced productivity, higher turnover, and long-term financial repercussions. Yet many traditional workplace approaches that focus on reactive support for mental health issues, rather than proactive prevention, fall short in fostering true resilience.

Instead, organizations must equip employees with the personal and professional skills they need to navigate mental health challenges. Through a skills-based approach, leaders can cultivate a resilient workforce, enhance employee well-being, and sustain business success.

Mental Health Crisis Enters the Workplace

The workplace is a significant contributor to mental health challenges. Four in 10 employees say their job negatively impacts their mental health, according to research from Gallup and Workhuman, and over half of employees (52%) reported feeling burned out because of their job, according to a poll from the National Alliance on Mental Illness (NAMI) and Ipsos.

These concerns are even more prevalent among younger workers. While three-quarters of workers (75%) experienced at least one mental health challenge “sometimes” or “often” during the past year, according to LIMRA’s 2024 BEAT study, around 9 in 10 Gen Z workers (91%) reported experiencing mental health issues at least “sometimes.” (Gen Z is usually defined as those born between 1997 and 2012.)

Additionally, MetLife’s 2025 Employee Benefits Trends study found that more Gen Z workers experience depression than the average worker (35% and 20%, respectively). The research also shows that nearly half of Gen Z workers (46%) feel stressed, and 44% feel burned out—rates that are both about 10% higher than for the average worker.

Workforce Disruption and the Future Talent Pipeline 

Escalating mental health challenges among younger generations pose significant risks to the workforce—with no signs of improvement. In fact, they are expected to intensify.

The Centers for Disease Control and Prevention’s Youth Risk Behavior Survey Data Summary & Trends Report for 2013-2023 found nearly all indicators of poor mental health and suicidal thoughts and behaviors in U.S. high school students worsened over the past decade. In 2023, nearly a third of high school students (29%) reported poor mental health in the past 30 days. Additionally, 4 in 10 high school students reported feeling sad and hopeless almost every day for at least two consecutive weeks, to the extent they stopped their usual activities—a 10-percentage-point increase from 2013.

Now, as this generation enters the workforce with more recognized mental health concerns than previous generations, businesses must adapt to address the growing mental health needs of incoming talent. While fostering supportive environments is a critical step in building a resilient, engaged, and productive workforce, reactive support and validation alone are no longer enough.

The Impact of Employee Well-Being on Business Success

Failure to support employees and prioritize their mental well-being can pose significant risks to businesses, including reduced productivity and hindered long-term growth. Year-over-year, a rise in mental health-related absenteeism is taking a toll on employee productivity across industries, according to ComPsych:

• Mental health-related absenteeism increased 300% from 2017 to 2023.

• In 2023 alone, mental health-related absenteeism was up 33% from the previous year.  

• In the first quarter of 2024, 1 in 10 employee leaves of absences were attributed to mental health—a 22% increase in mental health leave from the same period in 2023.

ComPsych also found that in Q1 2024, more Americans took mental health-related leaves of absence than total combined absences for accidents, cancer, COVID-19, heart disease, and heart attacks. Additionally, the American Psychiatric Association reported that unresolved depression accounts for a 35% reduction in workplace productivity—and contributes to a yearly loss of $210.5 billion to the U.S. economy due to lost productivity, health care costs, and absenteeism.

Increased Turnover, Decreased Productivity

Poor employee mental health can also lead to higher turnover rates, which in turn increase costs for organizations. SHRM’s Employee Mental Health in 2024 Research Series found that employees experiencing burnout are almost three times more likely to be actively searching for another job. This trend is especially true for young employees: Around 1 in 3 employees (34%) ages 18-29 are considering quitting due to their job’s impact on their mental health, compared to only 21% of employees ages 50-64, according to the 2024 NAMI Workplace Mental Health Poll.

Both direct turnover costs, such as recruiting and training, and indirect costs, such as productivity loss, can be expensive for organizations. These obstacles not only increase expenses, they also impact operational efficiency and employee engagement. To mitigate these challenges, leaders must empower employees and help them build the personal and professional skills needed to address mental health issues head-on. Offering practical solutions through a skills-based framework can mitigate losses in productivity and retention, benefiting the well-being of both your employees and your business.

Reactive Support Alone Is No Longer Enough

Organizations are making considerable efforts to support employee mental health. Many offer a range of resources, workplace programs, and policies to help employees manage their well-being. In fact, the U.S. Chamber of Commerce found in 2023 that 94% of large employers (those with 500 or more employees) had enhanced their mental health care coverage, introduced new support programs, or implemented systems to assist employees in the previous three years. Yet despite these initiatives and support, workplace mental health challenges continue to rise—especially among young workers.

While 98% of employers offer at least one mental well-being benefit, according to Koa Health, these efforts often fall short of employee needs and preferences. As a result, 74% of organizations planned to increase or reallocate spending to better address employee mental well-being needs in 2024. To drive more meaningful impact, businesses should consider going beyond traditional offerings and invest in mental health training and skill development as part of their strategy.

Traditional well-being resources, such as mental health coverage as part of an employee’s insurance, are undoubtedly valuable. However, they often take a reactive approach, addressing challenges after they arise. Relying solely on reactive support without proactive solutions may inadvertently perpetuate cycles of stress and burnout. Instead, equipping employees with actionable skills to manage their well-being, such as coping skills and ways to build resilience, can help prevent challenges from escalating. To safeguard both employee well-being and the health of their business, employers must shift their focus toward empowering employees to navigate mental health challenges.

Skills-Based Strategies to Enhance Workplace Mental Health

A skills-based approach to mental health fosters both personal agency and workplace well-being. Rather than offering a quick fix, a skills-based approach proactively addresses the root causes of mental health issues. 

By equipping employees with actionable life skills such as resilience, adaptability, and problem-solving abilities, you can empower your teams to more effectively navigate both workplace and personal challenges. Consider the following skills-based strategies to enhance employee well-being and reduce negative business impacts.

1. Build Personal Skills and Emotional Intelligence

Provide education and training in personal mental health skills and emotional intelligence to equip employees to better manage their own well-being. Consider implementing workshops for stress management techniques, including mindfulness and deep breathing, and emotional regulation strategies, such as identifying triggers and reframing thoughts, to equip employees to respond to challenges with composure. Resilience training can also prepare employees for setbacks or incidents and allow them to recover more easily.  

Additionally, incorporating a mental health training session in your onboarding program can set a strong foundation for new employees. This will be especially important as younger and entry-level employees continue to prioritize workplace well-being. Make sure to introduce employee assistance programs and skills-based resources from day one. Doing so ensures new hires are equipped with the skills and practical resources they need to handle challenges and also fosters a culture of agency and support.

2. Develop Professional Skills and Problem-Solving

Workshops and professional coaching can help your employees develop problem-solving and decision-making skills to analyze challenging situations objectively, rather than taking them personally, and identify practical solutions. While it seems rudimentary, a focus on basic communication skills can help foster healthier workplace interactions and a sense of agency and morale. Providing actionable strategies for addressing workplace challenges will help employees take proactive steps to overcome them, rather than dwell on them.  

Additionally, ensure that your company’s professional development initiatives emphasize the importance of integrating mental health strategies in leadership and team-building efforts. Implementing feedback loops for employees and peer support groups will give them opportunities to practice and hone their communication and emotional intelligence skills, fostering a more connected workforce.

3. Foster Mental Health Literacy

According to the 2024 Nami Workplace Mental Health Poll, 7 in 10 senior-level employees report they have not received training on discussing mental health with their teams, despite 83% of employees agreeing that this training is crucial to a positive workplace culture.  

Developing mental health literacy among employees and managers is essential for fostering a supportive workplace culture. Offering mental health first aid training can prepare your employees to recognize the signs of mental health struggles in themselves and others, and to respond effectively during a crisis. This training can also equip managers to have respectful conversations about mental health without overstepping boundaries.  

Create a Resilient and Thriving Workforce

Leaders play a critical role in establishing supportive yet results-driven workplace cultures. While support is valuable, equipping your employees with the personal and professional skills needed to manage their mental health can prevent issues before they arise. By fostering actionable behaviors to navigate mental health challenges, you can foster a healthier, more productive workforce for the future.