Mental health challenges continue to exert a profound and measurable impact on the U.S. workforce, according to new data from TELUS Health. The organization’s latest Mental Health Index and 2025 TELUS Health Mental Health Barometer reveal a workforce under sustained strain—one where personal wellbeing, organizational performance, and long-term workforce sustainability are increasingly intertwined.
Based on fourteen monthly Mental Health Index surveys of five thousand U.S. workers each, the reports offer one of the most comprehensive and longitudinal views of workplace mental health in the country. Among the most striking findings: sixty-one percent of American workers report a recent decline in productivity tied directly to mental wellbeing concerns. Nearly one-quarter of workers remain at high mental health risk, still above pre-pandemic levels.
The findings highlight not only the personal toll of persistent stress, anxiety, and burnout, but also their expanding implications for employers, healthcare systems, and policymakers. Mental health is no longer a peripheral workforce issue—it is increasingly central to engagement, retention, care utilization, and organizational resilience.
Insights from Paula Allen, Global Leader of Research & Insights at TELUS Health, help explain what is driving these trends and what employers, healthcare leaders, and policymakers should prioritize next.
A Workforce Under Pressure—and Afraid to Speak Up
According to the latest Mental Health Index, forty-five percent of U.S. workers worry about career repercussions if their employer learns they are dealing with a mental health issue. At the same time, just fifty-six percent of people leaders report feeling equipped to support employees experiencing mental health challenges.
“What’s most striking is how many employees are struggling silently, fearing career repercussions if they speak up, while managers often feel ill-equipped to help,” Allen says. “We know from the data that employee health and wellbeing are deeply intertwined with workplace culture and financial stress, and these aren’t just personal challenges. They directly undermine productivity when people are not well supported.”
This gap between employee need and leadership readiness creates a compounding risk. When workers feel unsafe disclosing challenges and managers lack the confidence or training to respond effectively, issues often escalate into absenteeism, disengagement, errors, and reduced performance.
“The most important opportunity for leaders right now is to take a truly comprehensive approach to employee health and wellbeing,” Allen says. “One that promotes psychological safety, encourages open dialogue, and offers access to personalized support.”
Productivity Declines Signal a Systemic Challenge
The 2025 TELUS Health Mental Health Barometer reinforces how deeply mental health is influencing workforce performance. Sixty-one percent of workers report a recent decline in productivity, while twenty-two percent say mental health directly affects their ability to perform their job.
For employers, these findings challenge long-standing assumptions that productivity and wellbeing exist in opposition.
“Business leaders may at times unintentionally forget a fundamental truth,” Allen says. “People may thrive when challenged and well supported, but are likely to decline under relentless pressure without support.”
Organizations that prioritize wellbeing, flexibility, and trust consistently see stronger performance outcomes over time. “The most effective leaders understand that supporting mental health isn’t a trade-off with productivity,” Allen adds. “It’s the foundation for it.”
Stigma Remains a Persistent Barrier to Care
Despite years of increased awareness, stigma continues to prevent employees from seeking help. Nearly half of workers still fear negative career consequences if they disclose a mental health issue, reinforcing a culture of silence across many organizations.
Allen points to three critical commitments organizations must make to build psychological safety and trust.
First, leaders must normalize conversations around mental health. “Leaders must openly discuss mental health with empathy and without awkward discomfort,” she says. “Sharing the organization’s commitment to eradicating stigma goes a long way when communicated with facts and authenticity.”
Second, managers need targeted training. “Provide training so frontline leaders can help themselves as well as their teams,” Allen explains. Leaders must learn how to recognize early signs of distress, approach sensitive conversations with confidence, and guide employees toward appropriate resources.
Third, organizations must communicate support clearly and repeatedly. “Employees should know exactly what resources are available and how to access them without barriers,” Allen says. “This communication needs to be repeated to be remembered.”
When these efforts are sustained over time, employees begin to believe it is genuinely safe to seek help, strengthening trust and improving overall workplace culture.
Younger Workers Face Disproportionate Mental Health Risk
Generational disparities emerge as one of the most consistent findings across both reports. Nearly half of Gen Z workers and more than one-third of Millennials say mental health challenges are affecting their productivity—significantly higher than older generations.
“Younger workers are navigating a perfect storm of stressors,” Allen says. Many entered the workforce during the pandemic, missing formative in-person experiences that help build confidence and professional resilience. At the same time, they face heightened financial pressures and fewer established support systems.
Sleep disruption is a key factor. More than one-quarter of U.S. workers report dissatisfaction with their sleep quality. Thirty-four percent attribute poor sleep to mental health challenges such as anxiety or depression, while thirty-three percent say financial worries directly impact sleep quality. Younger workers are the most likely to report that poor sleep is hurting their productivity.
“When employers invest in supporting these emerging professionals early—through mental health resources, financial wellbeing programs, and initiatives that encourage healthy routines—it builds resilience, strengthens trust, and supports long-term engagement,” Allen says.
Financial Stress Is a Critical Health Risk Factor
Financial insecurity emerges as one of the most significant drivers of mental health strain. Half of U.S. workers worry about meeting everyday expenses, with cascading effects across mental health, sleep, relationships, and work performance.
“Financial stress doesn’t exist in isolation,” Allen says. “It reverberates across every aspect of a person’s wellbeing.”
Addressing this challenge requires collaboration across employers, healthcare leaders, and policymakers. Programs that improve financial literacy, increase awareness of available resources, and provide equitable access to consultation services can help mitigate mental health risk before it escalates into more serious conditions.
“Embedding total wellbeing into policy, workplace culture, and day-to-day operations creates an environment where financial health is recognized as a core part of total health,” Allen says.
Leadership Readiness Remains a Key Vulnerability
Only fifty-six percent of people leaders say they feel prepared to handle mental health concerns on their teams, highlighting a critical gap in leadership capability.
“Supporting mental health in the workplace goes beyond having compassion,” Allen says. “It’s a crucial leadership skill that must be taught, practiced, and reinforced.”
Effective training programs focus on practical skills—recognizing early warning signs, initiating difficult conversations, and responding to disclosures with confidence rather than avoidance. However, Allen emphasizes that training alone is not enough.
“Leaders need systemic support, including clear policies, accessible tools, and visible endorsement from senior leadership,” she says. “When organizations embed psychological safety into their culture and operations—not as an optional concept but as an expectation—leaders are far better equipped to support both wellbeing and performance.”
Trust and Wellbeing Drive Engagement and Retention
The data also highlights a significant opportunity for organizations that invest in trust and wellbeing. In high-trust workplaces, seventy-six percent of employees report higher engagement, and one-third say they would prioritize wellbeing support over a ten percent salary increase.
Allen points to a healthcare organization that expanded its Employee Assistance Program into a digital-first, always-on platform available to all staff. By making wellbeing support simple, visible, and stigma-free, the organization improved engagement and retention across clinical and administrative roles.
“This demonstrates that wellbeing isn’t just a benefit,” Allen says. “It’s a strategic business advantage.”
The Path Forward: Data-Driven Wellbeing as Strategy
Looking ahead, the relationship between mental health, workplace culture, and organizational performance is expected to become even more tightly interwoven.
“Organizations now recognize that wellbeing is not separate from business strategy—it’s fundamental to achieving it,” Allen says.
Data will play a central role in this evolution. Insights from the TELUS Health Mental Health Index and Mental Health Barometer enable leaders to identify emerging risks, personalize interventions, and connect wellbeing initiatives to measurable outcomes.
“When data is used to identify patterns, spot risks early, and guide proactive interventions, the conversation moves from awareness to action,” Allen says. “That’s how workplaces become not only more compassionate, but more resilient, more productive, and better equipped to sustain performance over time.”
For more information, visit telushealth.com.
Daniel Casciato is a seasoned healthcare writer, publisher, and product reviewer with two decades of experience. He founded Healthcare Business Today to deliver timely insights on healthcare trends, technology, and innovation. His bylines have appeared in outlets such as Cleveland Clinic’s Health Essentials, MedEsthetics Magazine, EMS World, Pittsburgh Business Times, Post-Gazette, Providence Journal, Western PA Healthcare News, and he has written for clients like the American Heart Association, Google Earth, and Southwest Airlines. Through Healthcare Business Today, Daniel continues to inform and inspire professionals across the healthcare landscape.
