Mental Health Becomes Leading Workplace Injury as Small Businesses Struggle with Safety and Costs

Workplace injuries are taking a heavy toll on small businesses, with 75% reporting at least one incident over the past year. According to Pie Insurance’s 2025 State of Workplace Safety Report, mental health-related injuries have now surpassed physical injuries such as slips, trips, and falls. These psychological claims accounted for 22% of all reported injuries, signaling a significant shift in how employers perceive safety risks.

The report, based on responses from over 1,000 small business owners and decision-makers across the U.S., reveals that half of all reported injuries were considered preventable. Despite this, 49% of businesses admitted to improvising safety measures due to lack of equipment, increasing risk exposure and related costs. On average, small businesses lost four employee workdays and three full business days annually due to these disruptions.

Mental health isn’t the only concern. Commercial vehicle-related incidents were reported by 42% of businesses with fleets, costing an average of $5,725 per accident. Meanwhile, employee resistance to safety protocols remains a key barrier, with the top reasons cited being a perceived lack of necessity or forgetfulness.

While 81% of small businesses say they are open to adopting AI-driven safety tools, only 44% have actually implemented them. The report highlights that organizations using AI have seen improvements in efficiency (97%) and safety (73%). As risks evolve, small businesses must balance culture, compliance, and innovation to better protect their workforce and bottom line.