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Famous intellects and innovators including the likes of Benjamin Franklin and Nicola Tesla are known not only for their contributions to the world but for doing so on very few hours of sleep per night. We may like to think we could all achieve similar success if we slept less and worked more yet the reality of the human mind and body suggests that insufficient sleep has adverse and far-reaching consequences on our health and well-being and, ultimately, the global economy. The findings of a recent study by RAND Corporation covering 62,000 individuals across five OECD countries show that insufficient sleep has far reaching economic consequences.

  • Workers who slept less than six hours per night reported, on average, a 2.4 percent higher productivity loss than workers who slept seven to nine hours per night.
  • On an annual basis, the US lost more hours to insufficient sleep than the other OECD economies RAND examined, racking up a loss of 1.23 million working days in 2015 and 2016. At a distant second, Japan lost an average of 0.6 million working days. Left unchecked, insufficient sleep could cost the US economy $450 billion by 2020, or roughly 2.02 percent of total estimated GDP of the US. 
  • RAND projects a total loss to the annual GDP of the covered OECD economies of 0.8 percent to 3.3 percent for the period from 2015 to 2030. Scenario 2 presents the most optimistic result for economic performance and assumes that very short sleepers (sleeping less than 6 hours) increase their sleep durations to six to seven hours.

It is worth noting that a correlation exists between people's states of mind, as measured by the widely-known Happiness Index, and the estimated losses in labor productivity examined by RAND. The simple correlation chart below shows that people are happier when they are more productive except in the US. Americans appear to be happier than people in the UK despite having a larger productivity loss due to insufficient sleep. 
 

Methodology Note: RAND scenarios

Scenario 1 - proportion of very short sleepers (sleep less than 6 hours) and short sleepers (6 to 7 hours) improve sleep duration to the recommended hours (7 to 9 hours). 
Scenario 2 - proportion of very short sleepers (sleep less than 6 hours) improves sleep duration to sleep between 6 to 7 hours. 
Scenario 3 - proportion of short sleepers (6 to 7 hours) improves sleep duration to sleep the recommended number of hours (7 to 9 hours). 

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