Quantifying the intangible costs related to non-ergonomic work conditions and work injuries based on the stress level among employees

Abstract

Undoubtedly, no specific method exists to measure the cost of displeasure among employees due to unpleasant or non-ergonomic work conditions. Despite the financial impact of these hidden costs on organizations’ performance, these types of expenses are usually ignored. The intangible costs are insubstantial and represent expenses that have no common quantity or labeled value attached to them. Estimating intangible costs related to work conditions based on stress level among employees is a technique that attempts to formulize a multidimensional relationship between input qualitative variables related to the state of work conditions or work injuries and the monetary value of the hidden costs encountered with them. This technique approaches the problem from a unique standpoint, revealing the concealed effect of the state of disorder of the production system and the stress level among employees that impact the overall efficiency. In addition, the influence of the stress level on the invisible costs of the optimal amount of labor and capital due to reduced ergonomic work conditions will be investigated over both the short run and the long run. Finally, the effect of work conditions on profit-cost-volume and the breakeven quantity will be formulated.