ONS stats have painted a grim picture of the UK’s productivity, with data showing no signs of a strong uptick.
The Financial Times reports that output per hour worked in the UK was just 0.2 per cent higher in the third quarter of 2018 when compared with the same period a year earlier, which is the slowest rate of productivity growth in two years.
And, worryingly, productivity in the UK fell quarter on quarter owing to a jump in hours worked – meaning British people are working for a longer time but for diminishing increases in output.
“All the evidence we have points to a productivity problem,” Toby Peyton-Jones, HR Director at Siemens UK & Northern Europe, told HR Grapevine at the end of last year.
“It is [a figure] impacted a little by the UK’s high level of self-employment, but even when taking that into account, it’s clear we’re really lagging behind the rest of Europe.”
And it’s likely to be having serious consequences for UK employees. Ben Willmott, the Head of Public Policy for the CIPD, told HR Grapevine that the impact is likely to be harming the quality of life of workers.
“We are unlikely to see any sustained increase in real wages or living standards until our productivity growth increases,” he explained. “This is why it has been such a focus of attention [in the media].”
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And, commenting on this month’s data, said Tej Parikh, senior economist at the Institute of Directors described the figures as “dismal.”
“The government’s industrial strategy has been reined back by Brexit negotiations since it was announced in 2017,” he said. “But this year the business community need to see tangible progress, otherwise we risk eating into our future competitiveness at the expense of politics today.”
But HR might have the power to halt this worrying trend, and even turn it around. Cary Cooper, 50th Anniversary Professor of Organizational Psychology and Health at the Manchester Business School, believes that with better management, UK businesses can improve their productivity.
“We have a lot of very technically skilled line managers in this country,” he said. “But I don’t think we have as many ‘people managers’ as we need. It requires real investment in training, and then changing the recruitment or promotion system to ensure the right managers with the people skills required are put into those roles.”
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“HR really has the ability to provide key insights [to the board] about the quality of management within a business,” added Willmott. “But, getting the basics right is also essential – just things like making sure all workers have written terms of employment and strong job descriptions can be potentially transformational.
“Without those basics in place, you’re just building on sand.”
