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39 Employee Theft Statistics: 2019/2020 Impact & Costs to Business

by Arthur Zuckerman

Revenue loss and even ultimately filing for chapter 11 bankruptcy are real risks business owners face as they maintain operations, and employee theft is one reason a business can take a nose dive. Potential global loss from fraud and employee theft is $2.9 trillion annually. It is also estimated that 33% of corporate bankruptcies in the US are linked to employee theft.

Embezzlers and thieves need a means, motive, and opportunity to commit their crime but there is no specific way to pinpoint a profile for the thieving employee as those who were caught committing occupational fraud typically have no prior records.

This article pulled currently available data on occupational fraud to present a snapshot of the repercussions of employee theft on business revenue.

Employee Theft Statistics Table of Contents

Impact of Employee Theft 

Employee theft is not a question of if but how often and how much. All businesses have experienced employee theft in one form or another. Over 75% of employees also admitted to pilfering from their workplace. Many would rationalize that periodically dipping into the pot will not hurt the business as the theft amounts are negligible. The small thefts combine to losses equal to 5% of annual business revenue while annual inventory loss rates come up to as high as 43% in the US.

  • 95% of all businesses have experienced employee theft.
  • 3 out of 4 employees admit to stealing from their employers at least once.
  • Nearly 40% (37.5%) of employees have stolen from their employer.
  • 3 out of 10 employee theft cases lasted for more than five years.
  • Employee theft cases lasting more than ten years cost an average loss of $5.4 million.
  • Employee fraud typically goes on for two years before it is detected.
  • Non-cash property theft nearly doubled in the period between 2002 to 2018 from 10.6% to 21%, an increase of 98.11%.
  • 89% of occupational fraud is asset misappropriation with a median loss of $114,000.
  • In comparison, financial statement fraud is only 10% of total occupational fraud cases but the median loss is $800,000.

Types of Employee Theft

Source: Kessler International

Created by CompareCamp.com
  • Global employee theft accounts for 28% of inventory losses while the rate for the US is 43%
  • 52% of employees steal office supplies – pens, paper, or used the company printer for personal profit.
  • 66.7% of retail companies reported an increase in inventory shrink in 2019.
  • Occupational fraud perpetrators typically have no prior criminal records but 4% have a criminal record or fraud history.
  • A typical business loses 5% of its revenue annually which translates to potential global fraud loss of $2.9 trillion.
  • 26.3% of occupational fraud cases were uncovered by a tip from an employee.
  • Seven out of 10 employee theft cases came from organizations with fewer than 500 employees.

How Occupational Fraud Is Detected

Source: ACFE

Created by CompareCamp.com

The Cost of Employee Theft

Business losses due to employee theft amount to $50 million annually in the US, but the financial losses are not equal for all businesses. Median losses for small businesses are 92.31% larger than a business with employees numbering more than 100.

  • The loss is greater for small businesses. A business with an employee count of less than 100 has a median loss of $200,000 while those with over 100 employees only report a median loss of $104,000.
  • 19% of cases of occupational theft involves owners and business executives but it caused a median loss of $850,000
  • Business losses amounting to $50 billion are recorded annually from employee theft.
  • 42.7% of Inventory loss in US stores is caused by employee theft.
  • One-third of business bankruptcies in the US are caused by employee theft. Total business losses from these bankruptcies amount to $50 billion annually.

Source: GetVoIP

  • There were more than $7 billion in total losses globally in 2018 because of occupational fraud.
  • Nearly a quarter of occupational fraud cases had over $1 million in losses.
  • Small and mid-sized businesses, those with employees fewer than 500, have lost an average of $1.13 million in 2017.
  • 66% of tech employees who stole from their employers, took items valued between $1–$19. 14% stole high-value items, $100+, and are the second-highest group.
  • The average employee theft case value in 2019 was $1,380.62 which is a considerable 11% jump from the previous year’s case value.
  • The average employee embezzler stole nearly $25,000 a month from work.
  • 5% of occupational fraud perpetrators are aged 56–60 but they have caused the largest median loss at $480,000.

Employee Theft Statistics Based on Industry 

Employee theft exists across many industries. Research from the Association of Certified Fraud Examiners found embezzlement, one form of employee theft, have higher cases in the banking and finance sectors.

  • 37% of employee theft in the form of embezzlement is perpetrated by finance and accounting employees.
  • The most common embezzlement scheme is funds theft which is used in a third of all cases.
  • The industries most affected by occupational fraud are banking and financial services, manufacturing, and government and public administration sectors.
  • One in five tech employees steals from work.

Industries with High Cases of Occupational Fraud

Number of cases per industry in 2018

Industries with High Cases of Occupational Fraud
Banking and Financial Services: 338

Banking and Financial Services

Industries with High Cases of Occupational Fraud
Manufacturing: 201

Manufacturing

Industries with High Cases of Occupational Fraud
Government and Public Administtration: 184

Government and Public Administtration

Industries with High Cases of Occupational Fraud
Healthcare: 149

Healthcare

Industries with High Cases of Occupational Fraud
REtail: 104

REtail

Source: ACFE

Created by CompareCamp.com

Employee Theft Demographics

Employee theft in the form of occupational fraud has more cases with male perpetrators. The global average is close to 70% for males but the rate is even higher in other continents. The rate for the Middle East and North Africa is more than nine out of 10.

This is more a case of opportunity than a propensity for theft. After all, there are more men in the workplace in the MENA region as well as in other parts of the world. When women do commit employment theft, however, the value of the theft is 75% lower.

  • Gender skews male in occupational fraud with a global average of 69%. The Middle East and North Africa have the highest rate of male occupational theft, 92%, while North America has the lowest at 64%.
  • 56% of funds theft cases are perpetrated by women.
  • 83% of female tech employees who admitted to theft at work took items valued between $1–$19 while the rate for male tech employees is 65%. In contrast, only 9% of female tech employees took high-value items $100+ versus 17% for male tech employees.
  • Employee theft in the US was committed by 59% of men and 41% of women.

Source: Statistic Brain

  • Employee theft perpetrators have an average age of 48.
  • 38% of employees who commit occupational fraud are between the ages of 36–45.
  • Employees with high school education and a bachelor’s degree are tied at 34% of employees’ educational background most likely to commit occupational fraud.

References:

  1. REPORT TO THE NATIONS | 2018 GLOBAL STUDY ON OCCUPATIONAL FRAUD AND ABUSE
  2. 35+ Shocking Employee Theft Statistics to Know in 2020 – JW Surety Bonds
    Blog
  3. Employee Theft Statistics: Why Entrepreneurs Should Worry
  4. Annual Retail Theft Survey – Jack L. Hayes International, Inc.
  5. How Big of a Problem is Employee Theft and Fraud?
  6. 27 Jaw Dropping Employee Theft Statistics – BrandonGaille.com
  7. Employee Theft: Why do employees steal? – California Restaurant Association
  8. Employee Theft Statistics – Statistic Brain
  9. 2017 Hiscox Embezzlement Study
  10. U.S. retail workers lead the world in theft from employers | Fortune
  11. Study: 21% of Tech Employees Steal from Work | GetVoIP

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