Productivity tools exist in abundance but in the first quarter of 2023, we have experienced the biggest fall in productivity in over 75 years. The United States Bureau of Labor Statistics (2023) reports a drop of 2.7% in output per hour. At an economically challenging time, productivity in the workplace is critical to ensuring businesses stay afloat. Hence, leaders need to understand why productivity is decreasing and what they can do to change this upsetting statistic.
The methods we use to define and measure productivity vary. According to a Slack (2023) survey, 71% of executives say they are under extremely large pressure to increase productivity among their employees. A study by Microsoft (2023) found that 85% of executives struggle with their confidence in employees being productive in hybrid work settings. The majority of these leaders are focusing on input instead of output. Leaders are raising the bar for employees to do more, including working after hours. Vox (2023) reports that employees in return are spending more than a third of their working hours making an effort to look like they are working, concentrating on supposed productivity signals. Because remote workers are not in the same physical space as their bosses, they spend even more time proving they are productive. Productivity, especially in knowledge work, is measured ineffectively by companies. Measuring the wrong metrics harms productivity and explains some of its recent declines. The focus should be on employee output.
An essential element of productivity is employee engagement. Zippia (2023) reports that 68% of the American workforce is not engaged at work. In comparison to the rest of the world, the United States is doing better than average. Globally, only 21% of the workforce is actively engaged at work. Disengagement costs employers $3,400 for every $10,000 an employee earns per year. Gallup (2023) estimates that low engagement costs the global economy $7.8 trillion a year. That's a lot of zeros. Employees are less involved in, enthusiastic about, and committed to their work than ever before. External causes of low engagement are, according to Forbes (2023), changes in the economy, geopolitics, and public health. Internally, the news of layoffs and employees losing interest in their jobs are causing engagement to falter. We find ourselves amid a dangerous mixture that makes employees divert their focus and efforts away from work, resulting in lower productivity.
The approach that leaders took to increase productivity is having a big backlash. Yes, external causes are difficult to remedy but it's the internal situation that leaders have created that now leads to further declines in productivity. It is the poor handling of- and response to social unrest and the COVID-19 pandemic, still present in leadership today, that curbs productivity. According to Forbes (2023), feelings among employees of distrust toward leaders, isolation, and a lack of ownership are directly related to leaders failing to clearly outline and communicate their expectations. 89% of Human Resources professionals stress that being more transparent about these expectations and providing continuous feedback are the best ways to increase employee engagement (Zippia, 2023). A lack of focus from leaders on employee recognition and physical safety contributes to employee disengagement (Forbes, 2023). Executives' actions in response to global changes largely explain the drop in productivity. Leaders now need to revisit those actions and change their approach.
There are plenty of ways for leaders to effectively increase productivity and employee engagement. According to Zippia (2023), engaged employees are 22% more productive than their disengaged counterparts. The productivity solution is not only to increase wages. Zippia (2023) reports that about 60% of employees would take a pay cut for a job they can be passionate about. The focus must be on the whole employee experience, specifically the work culture, career opportunities, and wellness programs. 58% of American workers say leadership is not proactive or takes no action related to culture (Zippia, 2023), while organizational transparency and better communication are known to increase employee engagement (Forbes, 2023). Employers can invest in their training. Training and career opportunities must also be made available to employees. 89% of millennials rate advancement opportunities as very important (Zippia, 2023). Executives have to top it off with an investment in meaningful wellness programs, including a good work-life balance. 89% of employees who work in companies with decent wellness programs are engaged and satisfied with their jobs (Zippia, 2023). In a new approach to increasing productivity, we have to prioritize culture, career, and communication.
The space created for employees to be engaged and productive has to be leveraged by leaders too. Leading by example, that's key. Search productivity, and you will find articles, books, blog posts, and more about how to improve your setup. Even the European Commission wrote about it in July 2022. Their approach is relatively simple and easy to adopt. Make sure you have an uncluttered workspace, plan your day, keep tasks digestible, build in breaks, anticipate when you are most productive, and turn off notifications. Don't invest in too many productivity tools. They take time to maintain and consequently make us less productive. Build a simple setup that allows you to coordinate, communicate, consume, capture, and create. Don't take on too many tasks and avoid creating tasks for activities you can execute immediately and in no more than ten minutes. Focus on output.
To avoid another record of productivity loss, leaders must revisit their approach and measure output. They have to better anticipate global changes and more clearly communicate their expectations to employees. These expectations must be focused on results and employees must be enabled through organizational transparency, continuous feedback, training, and a healthy work environment. Leaders have to be more humane (i.e. less meeting and productivity-tool dependent), proactive, take initiative, and lead by example to get employees engaged and more productive.