UK200Group Members explore the decline of productivity in the UK
Members of the UK200Group of independent accountancy and law firms have commented on new research which shows productivity is a major issue in UK businesses.
A new study by the Smith Institute has found UK employees are spending longer at work for little or no gain in productivity.
The UK think tank revealed that two-thirds of employees say they are working longer than two years ago, but only 10% believe they are more productive. A quarter of staff believed their productivity had declined over the period.
Average output per hour is already around a fifth higher in the rest of the G7 nations compared with the UK.
Jonathan Russell, partner at UK200Group member firm ReesRussell, said:
“The Western World has created a culture not about productivity, but about the appearance of hard work and dedication, which has distilled down to employees being early to start and late to leave.
“This coupled with the slowdown in the economy has created a culture of appearing to be busy, even when there is no work, which is encouraged by employers who are worried about the availability of staff and their ability retain employees over the quieter times.
“This has created a vicious circle and will take some time to change back. Staff need to feel valued and secure in their jobs so they can dispel the fear that if they have no work to do their jobs will be on the line.
“Many employers, and certainly the wise ones, will reward the improved productivity as that results in improved profits, but employers have seen productivity slipping and margins reducing, which ultimately puts pay under pressure.
“The creation of simple, achievable and rewarding production targets is the way forward for smaller businesses, which reward the entire workforce so as to create a team effort – easily said, but often harder to achieve.”
Duncan Montgomery, tax partner at UK200Group member firm Whittingham Riddell, said:
“Motivation comes from the leadership of a business and for SMEs with the right tools to incentivise management, much more can be achieved.
“A positive management team can drive the business forward, using smart reward systems, be it a menu of choices around extended holidays for some, or birthdays off, or share options and tax free incentives, an SME can change to a more driven culture with a few simple changes.”