About a quarter of all employees are expected to experience some form of mental health problem during their working lives, with 5 out of every 100 workers being depressed at any one time.
More than 155 million working days are lost each year because of depression at a cost of pounds 3bn in lost wages.
Dr David Baldwin, launching a Defeat Depression campaign, said there was a social stigma attached to depression which clouded people's judgement over the illness.
'The cost of employees with depression is immense. The cost of treating depression is rather slight,' he said. 'If people were encouraged to seek healthcare and get better, they would be able to resume their work and the cost to the employer would be reduced.'
Poor working conditions, such as cramped offices, noisy factories and hot, stuffy shops all contributed to stress and tension, and Dr Baldwin, a psychiatrist at Ealing Hospital, west London, said there were few occupations where some employees did not suffer.
Many cases remain undiagnosed and are often hidden under labels of physical problems like headaches, colds or flu. At work the effects would be demonstrated by slowness and mistakes, poor timekeeping, low levels of concentration, arguments with colleagues and clients, and an increase in absence or sick leave.
Professor Paul Freeling, of the Royal College of General Practitioners, said that one in seven new adult GP patients was suffering from some form of depression. Anti-depressant drugs produced results within four weeks although many people prefer 'talking' treatments like counselling. 'It is particularly important to emphasise the fact that depression is unlikely to permanently affect a person's ability to work,' concludes the Royal College of Psychiatrists in Depression in the Workplace, a new leaflet for employers.
About half of all sufferers do not experience another attack and the disease can occur at any age. Depression is more common in women by a factor of two-to-one.
The Royal College of Psychiatrists is hoping that employers will adopt occupational health policies that can pick up on depression and allow workers to be treated. Relatives and friends of sufferers are also asked to watch for sings of undue sadness, crying for no reason and a loss of interest in food or normal social activities. The college is also hoping that businesses will organise their work routines to minimise stress, which can add to depression caused by domestic circumstances.