Unraveled: Understanding Burnout as a Systemic Risk

The World Health Organization’s 11th Revision of the International Classification of Diseases newly designated burnout as an occupational phenomenon Nate Worrell

Photo: iStock.com/1379611336

“When did you last shower?” During the pandemic, showering decreased by 30%, claims Jennifer Moss, keynote speaker at the Society of Actuaries’ 2022 Life Symposium and author of The Burnout Epidemic. One driver is not having to go into the office as much. A more concerning cause could be people losing their zest for life.

The World Health Organization’s 11th Revision of the International Classification of Diseases (ICD-11) newly designated burnout as an occupational phenomenon.

“Burnout is a syndrome conceptualized as resulting from chronic workplace stress that has not been successfully managed. Three dimensions characterize it: feelings of energy depletion or exhaustion; increased mental distance from one’s job, feelings of negativism or cynicism related to one’s job; and reduced professional efficacy,” notes the WHO.

Beyond hygiene, Moss collaborated with researchers at the Harvard Business Review to assess data on burnout globally.

The Maslach Burnout Inventory (MBI)1 assesses worker sentiment across several dimensions: Emotional Exhaustion, Depersonalization, Personal Accomplishment, Cynicism and Professional Efficacy.

Drivers of burnout include high workloads, lack of autonomy, lack of reward/recognition, poor relationships, perceptions of unfairness and mismatched values.

Across many dimensions, Moss and the research team found that the drivers of burnout are prevalent, and measures of burnout are high and increasing rapidly from historical results. But, most pointedly, “only 21% of respondents rated their well-being as ‘good,’” and a mere 2% rated it as “excellent.”

If burnout were present in a singular organization, it could be viewed as an acute condition or a contained risk. However, as increasingly more organizations deal with the same struggles, a burnout contagion could threaten societal success.

This article introduces the concept of burnout as a systemic risk, focusing on how burnout manifests in education, healthcare and insurance and the consequences of a collapse of these institutions. A search for light in the darkness will follow, with mitigations and actions to help counteract unfavorable trends.

Teacher’s note

While the “Great Resignation” affected many industries, shortages in the teaching profession are not new. Wage issues, standardized testing and political scrutiny around curriculum choices have contributed to staffing difficulties, according to an article in The New York Times. Add a pandemic to this cluster of frustration, and a picture of an overstressed system emerges.

A survey from the National Educators Association found the following:

  • Nine in 10 teachers list “burnout” as a serious issue. Two out of every three consider it “very serious.”
  • Over half (55%) intended to accelerate retirement plans as of November 2021. This number is rising fast: In July 2020, the number was 28%, climbing to 37% by 2021.

Economic data from the Bureau of Labor and Statistics confirm the strain to fill jobs:

  • Job openings are up. The current academic year began with 2.43 million openings, a 53% jump from the same time period a year before.
  • Hiring is down. The ratio of hires to job openings in the education sector reached new lows at 0.59 hires for every open position, a large decrease from 1.54 in 2010 and 1.06 in 2016.

Part of the issue, certainly, is pay. In her book, Moss tells the story of a teacher who sold her blood to support herself. But, beyond getting a living wage, teachers lack autonomy and, in some cases, feel unsafe, having to wear protective vests at their places of work.

And the kids are not all right. The Northwest Evaluation Association (NWEA) announced research findings indicating that elementary school performance is down and gaps are widening. In addition, the Institute of Education Sciences School Pulse Panel from May 2022 highlighted increases in behavioral disorders. Finally, in 2020, the CDC indicated that instances of mental illness emergency visits for kids, including anxiety and depression, are all on the rise.

It is the stuff of actuarial nightmares—the nefarious death spiral. Teachers leave. Kids’ behavior and wellness worsen. This makes it harder for remaining teachers. So, they leave, classroom sizes increase and the job for a replacement teacher is exponentially more challenging.

Who will care for mom and dad?

Education is one of many sectors facing staffing shortages. Another industry throttled by the pandemic is the health sector, particularly elder care.

Data from a 2022 survey from the American Health Care Association indicates nursing homes and other facilities are scrambling to attract and retain staff amid supply chain difficulties and inflationary costs.

In a Society of Actuaries Long Term Care Section podcast, Char Hu, Ph.D., from Georgetown Living, indicated that the pandemic and vaccinations were challenges that compounded existing struggles related to immigration, wage increases (up to 45%) and shifts in the culture of work. “We, as long-term care facilities, have to start thinking about employee engagement and retention in ways the industry never has ever before.”

Again, data from a 2019 bulletin produced by the Paraprofessional Healthcare Institute, Inc., (PHI) about this workforce is rather grim:

  • More than 1 in 3 healthcare workers rely on public assistance, and around 1 in 10 are uninsured—in an industry with injury rates up to 3 times as high as the rest of the workforce.
  • People are stretched thin. Survey results from the American Health Care Association indicate that “nearly all (99%) of nursing home providers are asking staff to work overtime or extra shifts.”
  • This simply can’t continue. Six in 10 providers are operating at a loss and are limiting admissions, and over half of nursing home providers claim that the current operation pace is unsustainable.

Additionally, census data indicates many countries are facing an aging population, with a higher chronic disease prevalence, per the Federal Interagency Forum on Aging-Related Statistics.

Also, COVID still isn’t over. Long-haul COVID continues to get headlines. This past winter, COVID has been joined by a particularly nasty seasonal flu and respiratory syncytial virus (RSV) outbreaks. As a result, there are more people to care for and fewer people to care for them, with more challenging circumstances, resulting in increased pressure on existing staff, which can lead to higher turnover and ultimately poorer quality and availability of care.


Actuaries and other insurance employees are also at risk of burning out. New standards like IFRS-17 and GAAP increase workloads and may stifle innovation. Supplemental talent resources are hard to find, turnover is higher and hiring budgets tighten in recessionary environments.

The 16th SOA Emerging Risk Survey also included data on staffing. Over 56% of respondents noted impacts, either losing or finding staff. Unfortunately, pre-pandemic data was not recorded, so there is no baseline. Still, Jennifer Hart, vice president of recruitment firm Actuarial Careers, Inc., has noted an increased trend for “work-life balance” based requests, including reduced hours.

Actuaries have to care for their children and parents too!

What might happen if care and educational institutions face crises?

Burnout threatens to consume a critical amount of teachers and nurses. The consequences of a care crisis are serious and may require a long recovery time.

Losing one year of schooling can compound deleteriously, affecting emotional development and future economic opportunity and ultimately promulgating generational hardship.

Inability to access care, delays in care or reduced quality of care can lead to increased severity of conditions, higher costs of treatment and, ultimately, increased mortality, according to  research from the McKinsey group.

Additionally, the fallout doesn’t hit everyone in the same way. Women, for example, left the workforce in droves, and per the US Chamber of Commerce as of February 2022, close to a million hadn’t returned.

The Human Rights Watch observed evidence from the pandemic, which limited access to education, and deferred or eliminated access to care, that confirmed disparate impacts among socioeconomic groups.

The latest Global Risks Report from the World Economic Forum raises further concerns about syndemics, stating, “a set of concurrent, mutually enhancing health problems that impact the overall health status of a population, within the context of political, structural or social environments… deteriorating social, economic and political contexts will contribute to endemic diseases and lead to poorer health outcomes for select communities.”

Entrepreneurs, charities, innovators and technology could relieve some burdens and fill in the healthcare gaps. But ultimately, there will be governmental intervention.

Even for those with the means to pay for it, the burden tends to fall on families when teaching kids and caring for our elders maxes out.

It seems that workers across job sectors will face tough choices. For example, meeting the needs of care for their families might compromise job effectiveness. Alternatively, job demands could contribute to the neglect of kids or elders, with potentially grave consequences.

The world is intricately linked, as shown in the following graphic (Figure 1) from the World Economic Forum. A failure in one node may bleed into others.

Figure 1

What does this mean for actuaries and insurers?

The Society of Actuaries 16th Emerging Risk Survey periodically polls insurers about emerging risk perceptions. While failing care and educational systems aren’t listed explicitly, “failed or failing states,” “regional instability” and “other” categories are available.

Although this is more than a financial problem, in a caregiving and economic crisis, based on experience, we know that the frequency and severity of medical claims and disability payments will likely rise across the board, particularly in mental health, challenging insurer financial positions.

What are the solutions?

There is time to act to avoid or mitigate some of the future pains. Here are some suggestions.

First, workplaces should scrutinize their environments and confront workplace burnout head-on, using an empathy-first approach. But, according to Moss, this responsibility does not fall to the workers.

“Yoga, vacation time, wellness tech and meditation apps can help people feel optimized and healthier. But when it comes to preventing burnout, suggesting these tools are the cure is dangerous,” she says. “What does this mean? We can no longer suggest wellness strategies that empower individuals to prevent and manage their burnout. Instead, we need to look at ourselves as leaders at the role our organizations play.”

Tactically, this can be done in a few ways. Inspired by Moss’s work, here are seven:

  1. Ensure basic needs are met. For example, housing relief, food programs and access to health services could boost worker productivity and wellness.
  2. Manage workloads through rigorous prioritization. It’s ok to say no to things.
  3. Consider more flexibility and lessen paperwork for time away.
  4. Give workers more autonomy in their work.
  5. Provide rewards and recognition while keeping an eye on fairness. For instance, consider how incentive packages may need to change from rewarding the most productive to a universal objective that fosters mental well-being.
  6. Foster a culture of community and collaboration, particularly by doing smaller-team-based activities.
  7. Actively listen to workers’ needs and then try to take appropriate action.

This may be easier said than done. Organizational change is difficult. “Tightening the belt” or “doing more with less” austerity measures may produce short-term benefits for shareholder value.

However, in a phone interview with Moss, she indicated that companies that are willing to invest time and money to reduce burnout could benefit from lower medical costs, higher productivity and better labor retention rates. For example, adding more support staff could reduce administrative work for doctors and nurses in the medical field. The net result could be more patient time, which is good for patients and providers, and would produce more billable costs, which helps the bottom line.

Second, support community organizations. Governmental assistance and safety nets exist, but many local community-facing nonprofits can be more effective at serving their neighborhoods. From food access to elder care, the work of various charities can achieve more success when it is well-backed, and funding is reliable. In addition, volunteer efforts can reduce burdens in schools or hospitals. For example, a program like Math Motivators, run by The Actuarial Foundation, can help close achievement gaps and reduce strain on teachers through mentoring and tutoring.

Third, strengthen the labor supply chain in the nursing and education sectors. This may include migration reform and easier entrance points into the profession, allowing apprenticeship paths in lieu of traditional schooling. As the population ages, supporting older workers will be critical, and having creative semi-retirement arrangements may help keep talent.

Fourth, embrace technology. Artificial intelligence may help workers automate or even complete administrative tasks. In academic settings, digital classrooms can supplement in-person instruction. In nursing, robotics is another way to add relief. Japan, for instance, has used exoskeletons and humanoid robots to complement caretakers serving its aging population. Additionally, various smart home devices and support apps that allow remote monitoring may make caring for elders at home more feasible.

Fifth, continue to explore and innovate. The world has changed. Work is no longer where you show up, do your job then go home. Instead, it is your conference room, kids’ school and parent’s hospital room. Is the 9-to-5, 40 (or 60 or 80)-hour work week too rigid or risky for the modern world?

Beyond these suggestions, improving your resilience will be critical, and it is something everyone can do. First, get the support you need. This can mean therapy or counseling, taking a vacation or just having a moment of respite, finding ways to foster gratitude, and other self-care tactics, including rest, fitness and diet. No one can get through the challenges ahead alone. People need support to provide support.

Across society, humans are tied to each in countless invisible connections. In the words of Dr. Martin Luther King Jr., “We are caught in an inescapable network of mutuality, tied in a single garment of destiny. Whatever affects one directly affects all indirectly.”

With the right amount of courage and compassion, I believe care, teaching and economic crises may be averted, ensuring hope for our children, parents, teachers and ourselves.

Nate Worrell is a client relationship actuary with Moody’s Analytics.

Statements of fact and opinions expressed herein are those of the individual authors and are not necessarily those of the Society of Actuaries or the respective authors’ employers.

Copyright © 2023 by the Society of Actuaries, Chicago, Illinois.