Despite working longer hours than many of our competitors, our national productivity is trailing behind. Does the answer lie in a happier workforce? Sandra Dick reports.
The extra hours at the desk, the lunch break that never happens, the entire weekend spent in front of the laptop and the endless meetings about having meetings.
For many employees, it’s a way of life. Add all this above-and-beyond time up and you might well expect that Scotland should be a force for superior productivity, hitting our targets with a high five for achievement, churning out the products and services our economy needs to grow.
However, it seems that despite all this effort the productivity of UK workers lags behind most of our European competitors, even though we tend to work longer hours.
And although Scotland’s productivity rate has shown slight signs of improvement, we are still playing catch-up with many of our closest rivals.
But, if we seem to be working harder, longer and more intensively, why are we not producing more? And, if we’re already pushing ourselves to the limit at work, what can we realistically do to drive up production levels so that we can, if not overtake our competitors, at least meet the Scottish Government target of joining the top quartile of OECD countries for productivity – an aspiration set in 2017 and one which Scotland is still 20 per cent below achieving.
Our national productivity is regarded as crucial to sustainable economic growth; it helps to boost businesses’ profitability, which leads to increased household incomes thanks to higher wages. Solving the puzzle of why we’re not as efficient as we might be could bring real benefits for all.
It’s an issue that is now under the close scrutiny of a multi-layered research team at Strathclyde Business School (SBS) at the University of Strathclyde, which is using a range of approaches and collaborations to analyse workplace productivity. It will look at what works, what could be done better, and how positive experiences can be shared and possibly adopted by other businesses.
Drawing on £1 million of funding, the business school’s Scottish Centre for Employment Research (SCER) aims to investigate management practices and their effect on innovation and productivity.
In particular, it will look at how employee engagement and the shift from ‘bad jobs’ to those which offer more satisfaction and opportunities to workers, could have positive spin-offs for our productivity rates.
“We have low levels of productivity compared to similar nations with similar degrees of infrastructure, and there is a long-standing concern about how to deal with that,” says the centre’s director, SBS Professor Tricia Findlay.
“In the past, some explanations of low productivity have erroneously suggested that it is a lazy ‘British worker’ problem. Other explanations offered include poor quality management and a lack of investment. But we want to look at productivity from the perspective of management practices and employee engagement.”
The project will review work and employment studies, delve into occupational psychology, economics and health in a bid to establish if improved job quality that makes workers feel secure, well-paid and with good prospects – a happier workforce, in other words – holds the key to better productivity.
OECD researchers have certainly suggested that Britain’s tendency to work longer hours does not necessarily boost labour output: productivity in Germany and the Netherlands far outstrips UK figures, while full-time workers are at their desks for fewer hours a week.
“If you want to drive productivity, it’s not complicated,” says Findlay, who is leading the SCER project along with Professor Colin Lindsay, supported by two of the centre’s researchers. “It’s about creating the thing you make in a much better way. And a lot of that relies on having people capable of doing it.”
The project – “Improving management practices: work engagement and workplace innovation for productivity and wellbeing” – includes input from a range of leading international scholars, including Professor Arnold Bakker, Erasmus University, and Professor Evangelia Demerouti, Eindhoven University of Technology, both world-leading researchers on job design and work engagement.
With professors Graeme Roy, of the Fraser of Allander Institute, and Sir Harry Burns, director of global public health at Strathclyde, also contributing to the research, the project is designed to build on SCER’s previous research which has explored workplace innovation, job quality and fair work with a view to identifying work practices that can deliver positive business outcomes and benefit employees at the same time.
According to Professor Roy, University of Strathclyde head of economics and director of the Fraser of Allander Institute, which is part of the business school’s Department of Economics, raising productivity requires investment, innovation and fresh approaches across a range of areas.
“Why are we less productive than we might be? Some of that is linked to levels of investment by firms in plant and machinery, but it’s also linked to people,” he says.
“There is a whole range of factors from the state of the economy, private and public investment through to how employers engage with employees. There’s not one specific thing that we can put our finger on and say, ‘that’s what we need to do’.”
Roy points to support for businesses keen to improve their productivity from the SCER-led research, or more broadly via Strathclyde Executive Education and Development (SEED) and the overarching SEED-based Policy@Strathclyde, which brings together expertise on policy from throughout the university.
Examples include the School’s Growth Advantage programme, now entering its fifth year, which has a unique approach that aims to help ambitious leaders of £1m-plus businesses access world-leading academic support combined with the power of peer learning.
Almost 70 businesses have so far taken part, with each registering average growth in employment and sales that exceeded the OECD high-growth threshold of 20 per cent.
A second support programme, Productivity through People, also delivered at the business school, provides SME leaders with the chance to share insights for success across a range of business areas, including leadership, innovation, people and productivity.
Meanwhile, the new collaborative research programme will pick out elements from Professor Findlay’s team’s findings on fair work and the impact of ‘good jobs’ in stimulating employee engagement and then combine them with the research on broader economic factors affecting productivity produced by Roy and his colleagues.
The result, it’s hoped, will be a clearer view of the kind of positive action businesses can take to raise productivity levels – possibly through providing workers with jobs which inspire them to work more efficiently, shifting management practices, improved training or investment.
“Scotland has one of the highest qualified workforces in the EU,” Findlay points out. “Why are those highly qualified people not being employed in ways that could improve productivity?
“Bad jobs impact health and well-being. They promote financial insecurity during working life and often into retirement. There’s an external cost to poor work that’s not borne by the employer.
“Better jobs, fair work and more engaged workers may well be the key not only to improving innovation and productivity but also to addressing economic inequality.”
The article appeared in The Scotsman’s Vision supplement. To find out more about the University of Strathclyde Business School, visit their website.