What are the true costs of an industrial accident?

Workplace safety is a fundamental aspect of any industry. However, we often underestimate the true costs of an industrial accident. Beyond physical injuries and compensation, there are numerous hidden or indirect costs that affect businesses and society at large.

The human and economic cost of industrial accidents.
The statistics are clear: according to the International Labor Organization, more than 2.78 million workers worldwide die each year due to workplace accidents or occupational diseases, and approximately 374 million suffer non-fatal occupational injuries. These figures represent an unacceptable human tragedy. But in addition to the human cost, industrial accidents also impose a significant economic burden. According to estimates, poor occupational safety and health practices account for nearly 4 percent of the world's gross domestic product annually.
Direct and indirect costs of work-related accidents.
When analyzing the cost of a workplace accident or considering the return on investment in safety technology, it is essential to understand that the overall costs of workplace accidents and occupational diseases go far beyond what is observed in the short term. They are divided into direct costs, which involve immediate outflows of money, and indirect costs, which do not represent immediate expenses but impose additional expenditures on the company's operations.
Direct costs:
• Compensation payments.
• Medical expenses and treatments.
• Legal and general charges.
These costs are usually covered by insurance companies through compensation premiums.
Indirect or hidden costs:
• Cost of time lost by injured workers.
• Cost of time lost by other non-injured workers, who stop working out of curiosity, sympathy or to help the injured worker.
• Cost of time lost by supervisors or executives.
• Cost of time spent by first aid personnel or nursing unit members when not paid by the insurance company.
• Costs due to damage to machinery, tools and property.
• Cost due to interference with production, failure to meet orders on time, loss of bonuses, payment of fines.
• Cost of continuing to pay full wages to employees even if they work for a reduced workday after returning to their job.
• Loss of profit due to worker productivity and having machinery not in operation.
Different perspectives on insured and uninsured costs.
Simonds's (1955) approach argues that the distinction between direct and indirect costs based on the type of accident is inappropriate. Instead, he proposes categorizing them as insured costs (borne by insurance companies) and uninsured costs (covered by the firm and society). This simplifies understanding the costs associated with workplace accidents.
The Elements of Production Method, similar to the previous one, breaks down costs into five production factors:
• Labor cost: reflects the cost of the time of the workers involved in the accident.
• Cost of machinery and tools: covers expenses for damage to machinery and tools.
• Material costs: consider the losses of raw materials, work in process, and finished products.
• Cost of facilities and equipment: addresses the costs of damage to buildings and facilities.
• Time costs: represents the cost of working hours lost due to the accident.
The sum of these costs weighted by the time lost in production forms the total cost.
The profitability of investing in occupational health and safety.
Safety technology plays a key role in reducing these costs. Investing in prevention and protection measures not only saves lives but also improves worker performance, productivity, and well-being.
In short, the true costs of an industrial accident go beyond injuries and compensation. They include human, social, and economic costs, as well as direct and indirect costs. Investment in safety technology and accurate data collection are essential to mitigate these costs and ensure a safer and more productive work environment. Workplace safety is not only a moral duty, but also a wise investment.

Source: https://drixit.com/es/costos-accidente-industrial