A new report published by the CSA Public Policy Centre estimates that Canada’s mental health crisis costs the economy $180 billion annually across healthcare, emergency services, the criminal justice system, and homelessness supports – more than three times the national estimate of $50 billion in 2011 (approximately $67 billion in today’s dollars).
The report, titled The Economic Cost of Mental Health in Canada, found that by 2050, the cost could rise to $600 billion – nearly 20 per cent of the country’s projected GDP.
Employers absorb the majority of the burden, taking on more than $110 billion in mental-health-related costs each year, yet many remain insufficiently equipped to address the underlying drivers. Of those costs, 86 per cent are spent on downstream impacts, including disability leave, workplace accommodations, and legal and compliance costs, while just 14 per cent goes toward prevention.
The report also found that governments across Canada spend more responding to the consequences of mental illness ($28 billion) than they invest in mental health care and prevention combined ($23 billion). Much of that spending is concentrated in crisis response, including policing, emergency rooms, and housing supports.
“The statistics in this report reflect the suffering of millions of Canadians navigating a system designed to respond too late rather than prevent harm in the first place,” said Dr. Olga Morawcynski, CSA public policy fellow and co-founder and CEO, Heal-3 Inc., and lead author of the report. “Prioritizing prevention and treating mental health with the same urgency as physical health can improve lives while easing costs for employers and governments.”
Mental health challenges are also contributing to Canada’s lagging productivity. Presenteeism – when employees come to work but cannot fully contribute due to mental health challenges – costs $12 billion annually. Nearly one in three Canadians report that their work is affected by mental health, and half will experience a mental illness by age 40.
The report identifies two foundational reforms that could help lower costs:
- Mental health parity refers to a system where mental and physical health receive the same funding, coverage and accountability. Achieving parity would require redefining “medically necessary” services to include counselling and psychotherapy and community-based mental health supports, tying federal mental health funding to clear, outcomes-based benchmarks, and establishing a dedicated federal minister for mental health and addictions.
- A prevention-focused approach would integrate early identification and support in workplaces, schools, primary care, and communities, addressing issues before they become critical and involve emergency departments or the judicial system.
“The direct and indirect costs of the mental health crisis are impossible to ignore but they also highlight a clear opportunity to invest in approaches that can meaningfully improve outcomes,” said Sunil Johal, vice-president, CSA Public Policy Centre. “The report shows how governments and employers can shift toward early identification and treatment, not just crisis response.”
The report and its recommendations contribute to CSA Group’s broader work supporting psychological health and safety in workplaces.
A revised edition of the standard is expected to be published later this year.
Reference: CSA Public Policy Centre
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