Mental health and well-being in SMEs

Small business owners are typically time-poor and overburdened with responsibilities, which can lead to a decline in wellbeing and unaddressed mental health issues. Government-funded initiatives aim to overcome the barriers to accessing mental health services. 

Small and medium-sized business (SME) owners have had much to reckon with in recent times. From a global pandemic to a series of natural disasters and challenging economic conditions, many owners and operators have faced higher than usual stress levels for a sustained period. Many lack the self-awareness or confidence to seek help when it is needed.

Mental health issues often manifest as depression and anxiety. They can affect productivity, sleep, appetite and relationships. A survey by Treasury in 2022 found that mental health issues are a key issue facing small business owners — who make up 97 per cent of the 2.6 million businesses in Australia, employ more than five million people and generate around a third of private sector output.

The sectors where mental health issues are most prevalent are in manufacturing, retail trade, accommodation and food services, construction, and healthcare and social assistance, according to the Small Business and Mental Health: Through the Pandemic report. “Small business owners still face barriers to accessing support and lack effective strategies to maintain their mental health. This is despite increased government investment in tailored mental health supports,” the report stated.

Par for the course

Similarly, 31 per cent of SME owners and operators consider mental health an immediate concern, yet almost the same percentage (30 per cent) find it difficult to discuss, according to the SME Mental Health Report of October 2022, produced by Smiling Mind and MYOB.

One in five of the 1000 respondents say they have experienced depression during the past year, while 44 per cent have experienced anxiety and 55 per cent feel responsible for the mental health and wellbeing of their staff. Almost two thirds (61 per cent) believe they could do more to improve their mental health and wellbeing.

“There is a lack of understanding among business owners that, ultimately, your energy and mental health will affect your business,” says Michelle Kvello, a non-executive director at Performing Lines and 10x10 Philanthropy, and founder of virtual CFO firm Lantern Partners, which provides advisory, financial tools and training services. “Your business holds a mirror up to your mental state.”

SMEs face unique challenges when it comes to maintaining their wellbeing and mental health. Perhaps the biggest is the lack of time they have to seek help — and the burden of being responsible for everything. Studies have found that financial distress is often a precursor to significant mental health issues such as severe anxiety and depression. Seeking help early is critical. In reality, mental health issues are often placed towards the end of a long list of competing priorities for SME owners.

“In a large business, the managing director, finance director and IT director are all separate people,” says NewAccess for Small Business Owners mental health coach Lawrence Atkinson. “But in a small business, it is the same person. Everything rests on their shoulders. Who does that person turn to when they’re feeling low?”

Kvello says that loneliness and the lack of a sounding board are two common issues that SME owners and operators first mention when they begin working with Lantern Partners. She also feels that the “hustle culture” that is rife within entrepreneurial communities is problematic. The risk of burnout from being “always on” is high.

“I used to work with a client who said, ‘We sprint the marathon here.’ I fundamentally disagree with that,” says Kvello. “You can’t sprint a marathon. Well, the only way is if it is a relay, with one person sprinting and one person resting until the baton is passed to them.”

Employees and founders at SMEs also lack access to employee assistance programs (EAPs) that could provide timely interventions. At organisations on the smaller end of the scale, there may well not even be a human resources function to help facilitate conversations around mental health.

Addressing the challenge

The federal government has funded projects that address the specific challenges that SMEs face in maintaining wellbeing and accessing services. NewAccess for Small Business Owners is run by NFP Beyond Blue in partnership with the Australian Small Business and Family Enterprise Ombudsman. Its accredited coaches are themselves SME owners and they use an evidence-based psychological treatment called cognitive behavioural therapy.

“I’ve had lived experience of depression, so I know what it’s like,” says Atkinson, who has been a coach since the program began in 2021. “It’s difficult to tell people how you are suffering because you don’t really know yourself. And often, you don’t want to talk to anybody.”

One of the key aspects of NewAccess is that a GP referral is not required to access the six sessions. This saves time and reflects findings in the Treasury report — that stigma towards mental ill-health within the small business sector remains high. “This stigma is likely to contribute to low rates of small business respondents seeking support from their doctor or other health professionals,” the report states.

The confidential NewAccess program is available to sole traders and small businesses with up to 20 employees. Six free weekly coaching sessions equip SME owners with strategies to improve their mental health and wellbeing. A major part of this is acknowledging that the mental health of an SME owner is important and will affect other parts of the business when things are not going well.

“Innovation comes from creativity,” says Kvello. “If you’ve got a burnt-out mind, there’s no environment to foster creativity. When you’re so caught up in the busy work that you don’t have space for those lightbulb moments. It has an impact on innovation, but it also has an impact on your financials.”

Since the NewAccess program began in February 2021, 3000 SME owners have used it to access help, with 70 per cent reporting a significant reduction in anxiety and depression levels by the end. One small business owner said that the program enabled her to turn her mental health situation around. “I’ve got a lot of perfectionist energy and [my coach] made me realise I was putting a lot of pressure on myself to get it all done, but it was actually unmanageable,” she says. “I now have a better understanding of how to manage myself and I’m able to connect with my joy. I was a bit fearful of the feelings coming back, but she gave me all these tools. I felt empowered.”

B2B line of support

Since 2021, the Counting on U mental health program has trained more than 4300 business advisers. The premise is that advisers often form trusting relationships with their clients so are well-placed to understand both business and personal needs. The program provides professional training intervention strategies to business financial professionals so they can better support the financial and mental wellbeing of their clients. Operated in Australia and New Zealand by Deakin University, it is funded by the National Health and Medical Research Council and the Australian Treasury.

“Getting access to SME owners is difficult,” says Professor George Tanewski from Deakin Business School. “They tend to bury their heads in the sand and are reluctant to admit to having a mental health issue.”

He says that sometimes small tweaks to the weekly routine can make a significant difference to overall wellbeing levels. “We often talk about finding some balance between the things that are pleasurable, necessary and routine. Often, with small business owners, they’re doing the necessary and routine things, but the pleasurable things have stopped altogether because they simply don’t have time. If this goes on for too long, their business will suffer and their staff will be suffering, too.”

In Tanewski’s experience, SME owners who rely on economic factors as the sole measure of success will ultimately have a less sustainable business. “Business growth is not only premised on sales or profits, but on the quality of human capital,” he says. “Business owners need to look at a broader set of criteria than in the past.”

As Vanita Smith, founder and director of Ayubowan health coaching service, notes, business owners must “walk the talk” when it comes to adopting strategies that promote wellbeing. Telling staff to take their annual leave and not to reply to emails late at night won’t hold much sway if the owner is doing the opposite. “A conscientious employee will always want to do the right thing and meet expectations,” she says. “Business owners must lead by example.”

Techniques such as breath work can help SME owners navigate the working week, says Smith. Deep diaphragmatic breathing can trigger a relaxation response in the body, which helps to manage stress levels. It can be used to cultivate a sense of calm and the ability to switch off, as well as to increase energy levels before giving a presentation. Guidance can be obtained in one-on-one coaching sessions or via YouTube tutorials.

“Energy management is a really helpful tool,” she says. “We have been in a state of hyperarousal for the past few years as part of an attempt to cope with uncertainties and challenges brought about by the pandemic. Now is an opportune moment to try to slow down and prepare ourselves for the post- pandemic phase.”

This article first appeared under the headline 'Repairing Resilience' in the May 2023 issue of Company Director magazine.