Alice doesn’t feel the same way about work anymore. Something’s changed. She used to approach it with a vocational spirit. She’d happily do extra hours because she believed in what they were doing as an organisation. They were in this together.

But now things are different. A new management structure has made her voiceless and depressed. Decisions she was once part of are taken behind her back. And the result? Discretionary effort – going the extra mile, working beyond contractual obligation – has been withdrawn. The goodwill has gone. Alice takes more sick days now.

This situation, replicated in thousands of other employees, is costly for business across the country. Productivity in the UK has been poor in the wake of the financial crisis, both compared with the recovery from previous recessions and with other countries.
The Government earlier this year launched a Productivity Plan, looking at how to promote long-term investment and how to create a more dynamic economy.

Investment incentives and the like are important, but people play a huge part in the productivity puzzle.
According to the Office of National Statistics, people took off more than 15m days attributed to stress, anxiety and depression in 2013 – a record level of absenteeism.

A BUPA report in the same year said that failure to unlock employees’ ‘discretionary efforts’ cut a potential £6bn from the UK economy in 2012. Yet some people still think caring about staff is ‘the soft stuff’.

There’s no one simple answer to loss of motivation because there’s no one simple cause. Everyone in business knows the debilitating effect of poor management on a workforce.

Then there’s the widespread disillusionment with capitalism, noted recently by Lloyd’s of London chairman John Nelson. The feeling among many employees is that they’re paying heavily for the financial crisis, while those who caused it proceed onwards and upwards unscarred.
Cynicism in the work place is an insidious force. What follows in the company is the withdrawal of optional extra effort – and on the national scene, the surprise appeal of Jeremy Corbyn.

But if there’s no one simple solution, clearly a little happiness would help. A recent study by economists at the University of Warwick found that happiness in the workplace led to a 12 per cent spike in productivity, while unhappy workers proved 10 per cent less productive.

As the research team put it: ‘We find that human happiness has large and positive causal effects on productivity’.
It’s not rocket science. Yet how many companies regard a commitment to wellbeing as a reluctant doff of the cap to some passing fad – rather than a serious investment in the future?

In my work I encounter stressed managers in the hospitality trade; despairing bankers who don’t see enough of their children; pressured recruitment consultants trying to seal the deal. Their emotional well-being is not a luxury, it’s the energy from which they’re able to perform – or not.
And well-being is measurable beyond people subjectively feeling better.

Jutta Tobias from the Cranfield University School of Management says this: ‘If you were to practice mindfulness for a couple of minutes right now, and a medical doctor had taken your blood pressure pre and post this short practice, your blood pressure would probably be measurably reduced after.’ A good exercise for any decision-maker surely?

Both staff retention and absenteeism are live issues for business today: according to Investors in People, 57 per cent of the work force plan to leave their jobs this year.

How will companies hold on to the staff they want to retain? Simple – by looking after them. The National Institute for Clinical Excellence estimates that an average company with a thousand employees saves £250,000 per year by engaging with employee wellbeing.

So will the number crunchers now accept it makes financial sense to care about employees’ happiness, and treat them with respect?

By Simon Parke, as published in This is Money on 18th October 2015

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