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Malnutrition costs businesses in developing countries up to $850bn a year, report finds

One in every three people faced hunger last year in Venezuela, according to the food agency's 2019 study - AP
One in every three people faced hunger last year in Venezuela, according to the food agency's 2019 study - AP

Productivity losses due to employees being underweight or obese are costing businesses in low and middle income countries up to $850 billion a year, equivalent to 2.8 per cent of GDP, a new report has found.

The findings are a stark reminder of the world's "faulty food system", highlighted by a report by the Lancet medical journal last year, which sees nearly one billion people go hungry, almost two billion eat too much of the wrong type of food, and which also puts unsustainable pressure on the planet.

The economic model, developed by think tank Chatham House and Vivid Economics, found that lost productivity from employees being underweight costs companies up to $38 billion (0.9 per cent of GDP) in the 19 countries modelled, and is a particular problem for businesses relying on manual labour, such as the agricultural sector and construction.

Laura Wellesley, a senior research fellow at Chatham House and one of the authors of the report, said that being underweight or having micronutrient deficiencies can mean workers are tired and have and lower stamina, impacting their productivity.

“One of the companies we interviewed reported that female factory workers suffering from anaemia have been known to faint while on the job,” she told the Telegraph.

Of the countries modelled, Ethiopia and India face the highest burden on business due to workers being underweight, with losses amounting to 1.6 per cent and 0.9 per cent of GDP respectively.

Hunger is on the rise, with one in nine people undernourished globally GHS
Hunger is on the rise, with one in nine people undernourished globally GHS

Obesity also makes it more difficult for an individual to carry out certain physical tasks,” said Ms Wellesley. “Another company we spoke to mentioned, for example, that workers on their oil rigs may be ‘grounded’, and not allowed back to work on the rig, if they’re too overweight, owing to safety concerns.”

Productivity losses due to employees being obese cost up to $27 billion (0.6 per cent of GDP) in the countries modelled, the report said, with the biggest impact felt in physically demanding roles such as minding and the health sector.

Of the countries modelled, Egypt (2.6 per cent of GDP), Albania (1.5 per cent) and Honduras (1.4 per cent) are the most heavily impacted.

The report also found that a number of countries face a significant “double burden” of malnutrition associated with both under and overweight workers, including Ghana, Namibia, Tanzania and Zimbabwe. In Namibia, 12 per cent of the workforce is obese and 10 per cent underweight.

The findings have led to calls for businesses to invest in employee nutrition, especially as the Covid-19 pandemic is likely to push millions more into poverty and ill-health. As such, the report recommends that companies introduce policies on nutrition, such as breastfeeding for mothers, regular nutritional health checks and subsidised food at work.

“Poor employee nutrition is a significant but poorly understood challenge for businesses operating in low- and middle-income countries,” said Ms Wellesley.

“Undernutrition and obesity are causing big losses across all sectors, and many businesses face a double burden of costs from both obese and undernourished workers. Multinational companies have the reach, expertise and resources to help make significant progress on nutrition and the Sustainable Development Goals, and it is in their interests to do so.”

Kristin Hall, head of major donors at charity, the Power of Nutrition, said: “There are many businesses that are showing real and welcome leadership on this issue, but much more needs to be done, and done at scale.

“Nutrition is historically underfunded, and with Covid-19 expected to push more of the most vulnerable further into poverty and ill-health, and donor and domestic financing coming under strain as a global recession looms, now is the time for businesses to invest in nutrition in a meaningful way.”

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