EC[ON]OMY

The hidden cost of workplace injuries on labor productivity

When people talk about labor productivity, they usually focus on investment, technology, modernization, and workforce skills. Much less attention is paid to a factor that affects the economy every single day but rarely makes it into the center of the business agenda. That factor is workplace injuries. Yet this is where a significant share of hidden losses lies – losses that directly affect business efficiency, operational stability, and the quality of economic growth.

At first glance, the picture looks encouraging. In 2025, Kazakhstan recorded 2,328 people injured in work-related accidents and occupational diseases. That was 5.8% lower than in 2024, when 2,471 cases were registered. But behind this improvement lies a much bigger story. A workplace injury does not end at the workplace. It turns into an economic cost that affects businesses, families, and the economy as a whole.

Every accident sets off a chain reaction. A worker leaves the production process. The company loses working time. Medical expenses, compensation payments, and replacement costs follow. Additional pressure falls on colleagues. Production becomes less stable. In some cases, the economy loses not only a worker but also years of accumulated experience, knowledge, and professional skills. That is why workplace injuries should not be viewed solely as a safety issue. In reality, they are a hidden tax on productivity that the entire economy pays every year.

The scale of the issue becomes clear when looking at where injuries occur. Workplace risks in Kazakhstan remain heavily concentrated in industrial regions. In 2025, East Kazakhstan Region recorded the highest number of injured workers with 287 cases, accounting for 12.3% of the national total. Karaganda Region followed with 277 cases or 11.9%, while Ulytau Region recorded 252 cases or 10.8%. Together, these three regions accounted for about 35% of all workplace injuries in the country. In other words, roughly one out of every three injured workers came from these regions.

This is not a coincidence. These areas remain among Kazakhstan’s key industrial centers, home to mining, metallurgy, and large-scale manufacturing operations. In many ways, workplace injury statistics also serve as a map of the country’s industrial economy.

Regional trends were far from uniform. Karaganda Region reduced the number of injured workers from 401 to 277 in just one year, a decline of 124 cases. Ulytau Region saw its figure fall from 287 to 252. Pavlodar Region improved from 183 to 150 cases, while the city of Almaty reduced injuries from 193 to 168. At the same time, several regions moved in the opposite direction. Atyrau Region saw injuries rise from 87 to 127 cases. East Kazakhstan Region increased from 253 to 287. Growth was also recorded in Mangystau, Zhetisu, and Aktobe regions.

The sector breakdown is even more revealing. Nearly six out of every ten workplace injuries in Kazakhstan occur in just three industries. Manufacturing accounted for 796 injured workers in 2025, representing 34.2% of all cases nationwide. Mining and quarrying recorded 380 injuries or 16.3%. Construction followed with 198 injuries or 8.5%. Together, these three sectors generated almost 59% of all workplace injuries in the country.

The trends within industries were mixed. Mining showed significant improvement, with injuries falling from 480 to 380 cases in a single year. Transportation and storage, healthcare and social services, energy, and administrative services also reported declines. Construction, however, moved in the opposite direction, increasing from 185 to 198 cases. Wholesale and retail trade, including vehicle repair services, saw injuries rise from 92 to 124 cases. Perhaps the most telling figure comes from manufacturing, the country’s largest source of workplace injuries. The number barely changed, moving from 800 injured workers in 2024 to 796 in 2025.

All of this has a direct impact on productivity. The concentration of injuries in manufacturing, construction, and mining means that losses occur in sectors responsible for a substantial share of economic output. The economy is notlosing just individual employees. It is losing people onproduction lines, construction sites, and industrial facilities where skills and experience matter most.

The data also reveals a striking difference between businesses of different sizes. While overall workplace injuries declined, large and small businesses moved in opposite directions. Large and medium-sized enterprises reduced the number of injured workers from 2,100 to 1,941, a decrease of 159 cases. Small businesses, meanwhile, saw injuries rise from 371 to 387.

Fatal accidents paint an even more important picture. Small businesses recorded 387 injured workers and 67 fatalities. Large and medium-sized enterprises reported 1,941 injured workers and 117 fatalities. In other words, small businessesaccount for a much smaller share of total workplace injuries, but the ratio of fatalities to injured workers is noticeablyhigher in this segment.

This does not automatically mean that small businesses care less about safety. More often, the difference comes down to resources. Large companies typically have dedicated safety teams, internal controls, employee training programs, and structured risk management systems. In small businesses, safety often depends on the experience and decisions of an owner, supervisor, or foreman.

But the biggest issue is not the accident itself. It is the economic cost that follows. In 2025, workplace injuries and occupational diseases resulted in the loss of about 106,000 workdays across Kazakhstan. That is equivalent to losing the annual labor of roughly 430 full-time workers. The value of lost working time is estimated at approximately 2.3 billion tenge. Direct material losses reached another 4.9 billion tenge. On average, each injured worker accounted for around 2.1 million tenge in sick leave payments, one-time compensation, and wage replacement costs.

Even these figures tell only part of the story. They do not capture lower productivity, lost expertise, disruptions to operations, additional workloads for remaining employees, or the long-term effects on business performance. That is why workplace injuries are increasingly viewed as a genuine economic issue rather than simply a matter of compliance andsafety procedures.

In international practice, workplace injuries have also longbeen viewed as a factor of economic losses, affectingproductivity, workers’ health, and the quality of economicgrowth.

According to the International Labour Organization, occupational accidents and work-related diseases cost theglobal economy approximately 4% of global GDP each year.

There is another consequence that is difficult to measure but becoming increasingly visible. Workplace injuries are gradually turning into a factor behind labor shortages.Young professionals do not choose jobs based on salary alone. They also consider working conditions, safety, and future prospects. If an industry becomes associated with danger, injuries, and health risks, it begins to lose the competition for talent. This is particularly important for construction, mining, metallurgy, and manufacturing.

That is why the conversation about workplace safety has moved far beyond helmets, manuals, and inspections. When an economy loses more than 106,000 workdays, billions of tenge, and hundreds of worker-years every year, the issue becomes one of economic growth itself. The most valuable asset in any economy is not machinery, buildings, or equipment. It is the people who show up to work every day. And every workplace injury makes that asset a littlesmaller. That is why workplace safety must become aneveryday culture in which everyone takes part. Aneconomy becomes truly mature when human safetybecomes a shared norm of behavior.

Alena Romanova, National Bureau of Economic Research, exclusively for www.economyKZ.org

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