A new report from the Organisation for Economic Co-operation and Development (OECD) has quantified the staggering economic toll of poor mental health across Europe, estimating annual costs of €76 billion — roughly 6% of total health budgets across the continent. The findings underscore what the OECD describes as one of the most significant public health and economic challenges of our time.
The report highlights that mental health conditions do not exist in isolation. They exacerbate physical ailments, leading to more complex and expensive treatments, which drives up healthcare costs. Beyond the health sector, the economic impact is profound: the OECD projects that mental health issues will reduce Europe's gross domestic product by an average of 1.7% annually between 2025 and 2050, primarily through lower workforce participation and productivity.
Rising Prevalence and Hidden Numbers
Across OECD and European Union countries, more than one in five people now live with a mental health condition. The rate of such disorders has climbed nearly 21% over the past two decades. Anxiety disorders are the most common, accounting for about 40% of cases, followed by depressive disorders at 20% and substance use disorders at 17%.
The OECD cautions that these figures likely underestimate the true scale of the problem. “Many milder conditions go undiagnosed or remain unreported due to persistent social stigma and limitations within existing health systems,” the report states. This hidden burden means the real economic and human costs are probably higher.
The report also warns that major depressive disorders, generalized anxiety disorders, and alcohol use disorders will reduce healthy life expectancy across the EU by 2.5 years over the next quarter-century, equivalent to roughly 28,000 premature deaths annually.
Young People Bear the Brunt
Mental health struggles are not evenly distributed. Women, young people, and those with low socioeconomic status are hit hardest. Among children and young adults, the prevalence is alarmingly high and rising. In recent years, more than one in four people aged 15 to 24 have experienced a mental health disorder, according to OECD data.
This is especially concerning because conditions that emerge before age 24 are more likely to persist into adulthood if left untreated, with lifelong consequences. The report points to multiple societal and environmental drivers: early COVID-19 pandemic restrictions, war, geopolitical instability, and economic crises have all worsened mental health.
“Climate change anxiety has emerged as a significant concern for the younger generation, with 84% of young people globally reporting moderate to extreme worry about the future of the planet,” the authors note. Problematic social media use is also flagged as an emerging concern, particularly among younger populations. Interestingly, mental health tends to improve as people enter adulthood, with a slight uptick only among those aged 95 and above.
Treatment Gaps and Policy Shortfalls
Despite most European countries having national mental health policy frameworks, a significant treatment gap persists. The OECD estimates that 67.5% of individuals needing mental healthcare in EU countries do not have access to treatment. Barriers include out-of-pocket payments for therapies, a lack of specialized services in rural areas, and shortages of mental health professionals.
The report advocates for a shift from hospital-based care to community-based interventions, including primary care, schools, and workplaces. “Early, preventive approaches outside hospital settings can be effective and less expensive,” the authors write. This aligns with broader European trends in healthcare reform, as seen in efforts to address other systemic challenges like energy-driven inflation and state aid adjustments.
The OECD's findings come as Europe grapples with multiple overlapping crises — from the war in Ukraine to economic uncertainty — that compound mental health pressures. The report serves as a stark reminder that investing in mental health is not just a public health imperative but an economic one. Without decisive action, the costs will only grow, affecting everything from healthcare systems to labor markets and the well-being of an entire generation.
