Why Sleep is Important for Health — and the Economy

We all know sleep is important, but did you know it's a big deal for the whole economy?

A cross-country research by Hafner et al. reveals that sleep’s impact extends far beyond the individual, shaping national economic productivity. Their study explores the link between sleep deprivation, mortality, productivity, and economic costs across OECD countries.

Let's delve into the findings and understand why addressing this issue is crucial especially for individuals who struggle with sleep.

Individual and Workplace Factors Impacting Sleep Duration

Hafner’s research analyzed data from over 62,000 individuals to determine the various factors associated with insufficient sleep. Several personal lifestyle choices, mental health concerns, and workplace conditions were linked to reduced sleep duration.

Here’s a breakdown.

Lifestyle and Health Factors

BMI

People with higher BMIs (overweight or obese) tend to sleep 2.5–7 minutes less per day compared to those with normal BMIs. Higher BMIs are also linked to sleep apnea.

Smoking

Smokers sleep about 5 minutes less per day than non-smokers.

Sugary Drinks

Those consuming more than two sugary drinks daily sleep 3.4 minutes less per day than those with lower sugary drink intake.

Physical Activity

Insufficient physical activity (i.e. having less than 120 minutes of exercise per week) correlates with 2.6 minutes less sleep per day compared to those engaging in over 150 minutes weekly.

Mental Health

Individuals with moderate to high risks of mental health issues sleep on average 17.2 minutes less per day.

Personal and Socio-Demographic Factors

Financial Concerns

Individuals facing financial stress sleep about 10 minutes less per day.

Unpaid Care

Those providing unpaid care to family members or friends sleep 5 minutes less per day. Unpaid care refers to doing cleaning, shopping, cooking, and other chores for family members who are too sick, too old, or too young.

Children

Parents with dependent children under 18 lose 4.2 minutes of sleep per day.

Gender and Marital Status

Men sleep 9 minutes less per day on average than women, while separated individuals sleep 6.5 minutes less, and never-married individuals sleep 4.8 minutes less compared to married individuals.

Workplace Factors

Lack of Choice and Autonomy

Workers with less control over their tasks sleep 2.3 minutes less.

Time Pressures

High workplace stress and unrealistic time expectations cut sleep by 8 minutes.

Irregular Hours

Shift workers sleep 2.7 minutes less per day than those with regular hours.

Commuting

Traveling long distances for work can significantly impact sleep duration. A commute of 30–60 minutes each way reduces sleep by 9.2 minutes, while commutes over 60 minutes cut sleep by 16.5 minutes daily.

While these time losses might seem minimal individually, their cumulative effect can be substantial. For example, an employee with irregular hours, a long commute, and high workplace stress loses an average of 28.5 minutes of sleep daily, amounting to over 173 hours of lost sleep yearly.

Insufficient Sleep Increases Mortality Risk

The study by Hafner and colleagues found a clear association between sleep duration and mortality risk.

Individuals sleeping less than six hours per night have a 13% higher risk of mortality than those sleeping the recommended seven to nine hours. Even sleeping six to seven hours, slightly below the recommended range, increases the risk by 7%.

Insufficient sleep is linked to various health risks and causes of death, including fatal accidents, cardiovascular disease, strokes, and cancer. This further underscores the importance of adequate rest for longevity.

Insufficient Sleep Reduces Workplace Productivity

Whether the cause of sleep deprivation is a disorder like sleep apnea or lifestyle factors, its consequences extend into workplace productivity.  

Employees sleeping less than six hours a night face a 2.4 percentage point higher productivity loss due to absenteeism or presenteeism (which means working while unwell), compared to those with optimal sleep. Workers sleeping between six and seven hours still experience a 1.5 percentage point productivity loss.

To understand the financial impact of these productivity losses, consider this: in a year with 250 workdays, an employee who sleeps less than six hours loses the equivalent of six working days more than their well-rested counterpart. Meanwhile, someone sleeping six to seven hours loses about 3.7 extra working days annually.

This effect magnifies across populations, with the U.S. alone losing an estimated 1.23 million working days annually, equating to 9.9 million hours due to insufficient sleep. Japan follows with 0.6 million days, while the UK and Germany each lose about 0.2 million working days, and Canada sees the lowest loss at 0.08 million days per year.

Economic Costs of Sleep Deprivation

The cumulative productivity losses from sleep deprivation are too big to ignore. They have significant economic repercussions.

According to the study's economic model, insufficient sleep reduces the effective labor supply, diminishing overall economic output. The model simulates three hypothetical scenarios for potential productivity gains if populations achieved adequate sleep:

Scenario 1: All short sleepers (less than seven hours per night) begin sleeping seven to nine hours.

Scenario 2: Those sleeping less than six hours increase to six to seven hours.

Scenario 3: Those sleeping six to seven hours increase to seven to nine hours, with no changes for those under six hours.

The findings show that in absolute terms, the U.S. sustains the highest annual economic loss (ranging from $280 billion to $411 billion), primarily due to the size of its economy. Japan follows, with losses between $88 billion and $138 billion. Relative to their GDPs, Japan experiences the largest impact, with a loss of 1.86–2.92% of its economy, followed by the U.S., the UK, Germany, and Canada.

Moreover, these costs increase over time, partly due to the mortality effect. A worker’s premature death due to insufficient sleep reduces future labor supply, further impacting economic output. By 2030, the annual economic cost of insufficient sleep in the U.S. could reach between $318 billion and $456 billion. The findings suggest that combating sleep deprivation can lead to significant economic benefits, reinforcing the need for collective action.

Solutions to Insufficient Sleep

To address the problem of sleep deprivation, the report offers recommendations aimed at individuals, employers, and policymakers. They are outlined below.

Sleep Tips For Individuals

Set a Consistent Wake-Up Time

Regular wake-up schedules contribute to better sleep quality.

Limit Electronics Before Bedtime

Reducing screen time helps prevent melatonin suppression, aiding sleep.

Avoid Sleep-Impeding Substances

Minimize caffeine, alcohol, and nicotine intake close to bedtime.

Exercise Regularly

Physical activity has been shown to promote better sleep outcomes.

Sleep Tips for Employers

Acknowledge Sleep’s Importance

Employers should recognize the critical role of sleep in employee health and productivity. This should translate to policies that allow and even incentivize rest and relaxation.

Provide Sleep-Supportive Facilities

Companies can promote sleep hygiene through policies or amenities that encourage better sleep habits.

Discourage After-Hours Device Use

Policies limiting after-hours communications can help employees disconnect and sleep better.

Sleep Tips for Public Authorities

Support Health Professionals

Training health professionals to provide sleep-related advice can help address sleep disorders.

Introduce Later School Start Times

Aligning school schedules with natural sleep patterns may improve sleep among students.

It is interesting that some companies, like Aetna, offer financial incentives to employees who achieve adequate sleep. Employees’ sleep were monitored through wearable devices and they received $25 for every 20 nights that they slept 7 hours or more, with a limit of $500 a year.

Studies suggest that subsidizing digital tools like sleep trackers can motivate people to prioritize sleep. However, because many sleep-related decisions are routine and unconscious, behavioral approaches may be more effective than traditional economic incentives in promoting better sleep habits.

Recently, another study on the impact of sleep on productivity found that  afternoon naps in the workplace raised productivity, psychological well-being, and cognition. Of course, the price to pay is reduced working hours.

Sleeping Your Way to Productivity

In short, sleep deprivation is a silent epidemic with far-reaching consequences. It's high time we took sleep seriously. Whether you're an individual, an employer, or a policymaker, there are many steps you can take to enhance sleep health.

On that note, if you are constantly struggling to sleep despite your best efforts, it might be best to take a sleep assessment. Consult sleep experts like the pros at Nightly for proper and convenient diagnosis and treatment.

Make sleep a priority today, and you unlock your full potential. Together, we can build a healthier, more productive future!