Cost Reduction

Cost Reduction

CIRCADIAN®’s comprehensive study of over five hundred 24/7 facilities has shown that working extended hours is associated with elevated employee costs compared to the daytime workforce. The good news is most of these costs are readily addressable.


Absenteeism alone accounts for as much as $2,100 in additional costs per year for shiftworkers as compared to dayworkers. For shiftworkers, only one-third of days taken as sick days are for personal health reasons. The remaining two-thirds are typically due to conflicts with family activities or social reasons, as well as excessive fatigue due to poor scheduling.

Operationally, high absenteeism can lead to increased overtime, inefficient production, poor communication, and overall loss of production.

Employee Turnover

Elevated turnover rates caused by low morale and poorly designed work schedules increase expenses for recruiting, hiring, and training new employees. With many shiftwork populations facing retirement of large percentages of their employees, attracting, and retaining employees is becoming an increasing problem.

Health Care

Increased health risks are found for digestive problems, diabetes, heart disease, sleep disorders and depression in the 24/7 workforce. Shiftworkers tend to use coping substances and food to help them deal with the challenges of staying alert, particularly when working night shifts, and sleeping during daytime. The downside to this is that overuse of caffeine and alcohol can cause other health problems and have a negative impact on performance at work as well as overall health. This ultimately leads to higher healthcare costs.

The good news is that these risks can be reduced and managed. It all starts with educating shiftworkers about proper sleep, exercise, and diet practices.

Overtime and Staffing Levels

Miscalculated staffing levels and sub-optimized shift schedules cause excessive overtime, often coupled with underutilized employee capacity. When there are not enough employees at a given time of day, the need for overtime arises. The difficulty for many operations is identifying the optimal number of employees and how to distribute them. This is particularly challenging for industries where demand and production is highly variable, with daily, weekly, monthly, or seasonal fluctuations.

The goal is to match employees up as close as possible to the needs of the operation. However, in doing so, the resulting schedule is often not very accommodating towards employee preferences. This problem can lead to higher absenteeism and turnover rates, which in turn will often drive up overtime.

Safety and Legal Liability

Fatigued employees make more errors, and when they fall asleep on the job the accidents can be disproportionately severe. The peak times of risk are at the circadian low points – in the early pre-dawn hours and in the post-lunch dip. It is not by chance that the most notable industrial accidents in the past 30 years – Exxon Valdez, Chernobyl, Three Mile Island and Bhopal all occurred between midnight and 6AM when human errors of inattention are most likely to occur.

How CIRCADIAN® can help you

The first step is to identify the reason for the increased absenteeism, whether it is due to a schedule that does not balance both operational and family/social needs or existing policies and procedures that do not effectively manage absenteeism.Shift Schedule Optimization. In cases where business needs and family social needs are not being met and result in higher absenteeism. A schedule optimization will assist in reducing absenteeism.

  • Shift Schedule Optimization. In cases where business needs and family social needs are not being met and result in higher absenteeism. A schedule optimization will assist in reducing absenteeism.
  • Fatigue Risk Assessment. Identifying the people, tasks and work schedules that contribute most to fatigue risk, and the strategies for best minimizing the risk.
  • Fatigue Risk Management Systems. CIRCADIAN® provides a comprehensive, multi-faceted approach to minimizing fatigue that is built into your culture, operating systems, and values.
  • Sleep Disorders Screening. Many health care costs are dramatically increased due to untreated sleep disorders. CIRCADIAN® offers screening and treatment programs that will guide shiftworkers and employers through the process.
  • Staffing Level Analysis. Identifying the core manpower requirement is crucial to improving the utilization of employees.
  • Proportional Staffing. Companies that have implemented flexible workforce management programs have experienced significant operational improvements. In one police department, scheduling efficiency rose from 65% to over 80% without adding any additional staffing.
  • Accident/Incident Analysis. Drilling down into the root cause of accidents and incidents to determine which are fatigue-related and the best policies and procedures to prevent reoccurrences.
  • Accident Litigation. Consulting and Expert Witness testimony in lawsuits in Federal and State courts
  • 24/7 Workforce Management Software. When workload demand is highly variable, schedule optimization tools provide efficient solutions
  • Education and Training. CIRCADIAN® offers effective programs specially designed to assist shiftworkers cope with the unique challenges of a shiftwork lifestyle, maintain good health and resolve social/family life issues.
  • Training: Managing a Shiftwork Lifestyle. Educating employees on how to maximize their sleep quality and quantity will limit absences due to excessive fatigue.
  • Employee Publications. Providing shiftworkers with the information they need to better adapt to the shift schedule will reduce turnover and costs associated with hiring.
  • Providing shiftworkers with the information they need to better adapt.

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