21
Feb 2026
The Hidden Cost of Illness: How Chronic Health Conditions Affect Productivity and the Economy
Published in News on February 21, 2026
Chronic diseases such as depression, cancer, sleep apnoea and migraines are not just health challenges—they are major economic challenges too. Preliminary research from Monash University highlights that these conditions are among the leading contributors to lost productivity and economic burden across Australia’s workforce. By examining how chronic illness affects working lives, we can better appreciate both the personal and macroeconomic stakes involved.
Across the country, millions of Australians live with a chronic health condition. These illnesses do not always lead to immediate disability, but they often result in prolonged reduced capacity to work—whether through absenteeism (missing days of work) or presenteeism (being at work but not performing at full capacity). Both flow-on effects have serious implications for productivity and the broader economy. Increasing rates of conditions such as depression, cancer, migraines, and sleep apnoea point to a growing problem with potentially billions in lost output each year.
Why Chronic Conditions Matter to the Economy
Chronic health conditions affect workers in both visible and invisible ways. Unlike an acute illness, which typically causes short-term work absence, long-term conditions influence a person’s ability to sustain consistent performance across weeks, months, or years. For example, someone managing depression or ongoing cancer treatments may experience fluctuating energy levels, concentration challenges, and reduced hours of participation in the workforce. These impacts translate directly into lost productivity for employers and lost economic contribution for the nation.
Using a newly developed “productivity index,” health economists in Australia aim to quantify the total cost of disease in terms of economic output. Notably, chronic conditions do not just cost in terms of healthcare expenses—an increasingly significant portion of their economic burden is productivity loss, which can outweigh direct medical costs. Studies in other high-income nations also indicate that chronic illnesses significantly reduce weekly working hours and lead to billions in lost productivity annually.
Absenteeism and Presenteeism: How Illness Reduces Productivity
Two major pathways through which health conditions affect work are absenteeism and presenteeism. Absenteeism occurs when a worker cannot attend work due to illness. Presenteeism, perhaps less visible but equally costly, happens when an employee is present at work but functioning at a diminished capacity due to their health condition. Both reduce effective labour hours and lower output.
Chronic diseases often lead to chronic absenteeism. Conditions that involve fatigue, pain or cognitive challenges—such as chronic migraine, depression or cancer—can mean regular days off work for treatment, rest or recovery. Over time, these days accumulate, reducing the total labour supply. Meanwhile, conditions like sleep apnoea or depression can undermine concentration and decision-making, meaning that even when individuals are physically present at work, their productivity is compromised. This dual burden contributes to a significant economic impact beyond what traditional healthcare cost metrics capture.
Labour Force Participation and Long-Term Effects
Beyond immediate productivity loss, chronic conditions can also influence long-term participation in the workforce. People with persistent health issues are more likely to reduce their working hours, take early retirement, or leave the workforce altogether. A growing body of evidence shows that this has broader economic consequences—not only in lost earnings for individuals, but in reduced tax revenue and increased demands on social support systems.
Ageing populations make this issue particularly acute. As Australians grow older, the prevalence of long-term illness tends to rise, increasing the share of the population living with one or more chronic conditions. This demographic shift puts additional pressure on labour participation rates and economic output, underscoring the need for proactive health strategies that support longer, healthier working lives.
Case Studies: Real-Life Impacts of Disease on Work
Depression and cancer are two conditions highlighted by the Monash Medical Centre research for their outsized influence on productivity loss. Depression, in particular, affects mental focus, energy and overall capacity to remain engaged in work tasks. Cancer—even after successful treatment—can lead to extended periods of reduced participation due to ongoing recovery or side effects of treatment.
Sleep apnoea and migraine might seem less life-threatening, yet their cumulative impact on day-to-day functioning can be profound. Sleep apnoea often leads to excessive daytime sleepiness, which has been shown in other studies to cost economies billions in productivity losses due to decreased performance and safety risks in high-responsibility jobs. Migraines, meanwhile, are a leading cause of work absence and are often underdiagnosed and undertreated.
The Broader Implications for Policy and Business
Given these challenges, employers, governments and health policymakers are increasingly recognising that chronic diseases are not merely health issues—they are economic issues that require strategic responses. Investing in prevention, early intervention and better disease management can yield productivity dividends, reducing both absenteeism and presenteeism while supporting sustained workforce participation.
In workplace settings, initiatives such as flexible scheduling, mental health support and ergonomic adjustments can make a meaningful difference to individuals managing chronic conditions. From a public policy perspective, broader investment in preventive health programs—such as tackling underlying risk factors like sedentary lifestyles or inadequate access to preventive healthcare—can help reduce the long-term prevalence of chronic disease and enhance economic resilience.
A Call to Action
Understanding the economic burden of chronic illness highlights an urgent need to shift how society addresses health and work. By treating chronic disease as a multi-dimensional challenge—one that affects individuals, workplaces and the broader economy—we open the door to more effective policies and practices that benefit everyone.
The future of workforce productivity will increasingly depend on how well we support health and well-being. Tackling chronic conditions not only improves lives—it strengthens the foundations of economic growth and sustainability in the years ahead.