Is the UK workforce up to the job?
Productivity is a major factor in business success. Last week the ONS released the latest figures comparing international productivity and they are slightly worrying for the UK, with output per hour worked in 2014 at a staggering 20% below the rest of the major G7 economies. This represents the widest productivity gap since comparable estimates began in 1991. So why is it that our workforces are not performing as well as others like Germany or France?
Germany have always been known for their hard work and efficiency, and it is unfair to assume that people in the UK do not work as hard. So taking hard work out of the equation, what is it then that is the difference?
Does it pay to pay more?
Average weekly earnings in the UK are £496 a week, an annual growth of 2.9%. But how does this compare to our fellow G7 countries? In Germany, you can expect an average wage of 3527 euros per month, that’s a whopping £643 a week, the highest of any G7 country. In Japan, workers earn an average of 420 JPY Thousand/month which is £562 a week and Americans earn on average only £269 a week at $10.50 an hour. However, when looking at GDP per hour worked the statistics do not necessarily match up with gross earnings. Germany are one of the most productive countries in terms of value output and with the highest earnings, wages could be considered a factor in their success. On the other hand Japan rank lowest out of all G7 countries for productivity yet their workforce are the second highest paid of the G7. And the US are one of the lowest earners in the G7, yet their output per hour worked is as high as France. So higher wages alone do not equate to business value for the G7 countries, therefore there are other considerations when investigating employee productivity.
What about holidays and breaks?
In the UK, the standard break is one 20 minute rest over a working day. And of course a regular weekend must provide a 48 hour rest after a normal working week. But what about other countries? In Spain, they are infamous for their siestas in the afternoon, where all business stops and people sleep, rest and eat through the hottest part of the day, sometimes lasting up to three hours. However, of course the Spanish economy is not propped up by siestas but being the fourth largest economy in the Eurozone and their continued recovery from the extended recession may suggest longer work breaks produce better results. In France, Europe’s third largest economy, many workers enjoy up to a two hour lunch break as lunch is seen as an important part of the day here. They are also entitled to more holidays than anywhere else in Europe, with employees at the French conglomerate EDF who are entitled to an additional 23 days off a year on top of their statutory 27. The average French worker can expect 30 days annual leave compared with 28 days in the UK and an average of 25 in Denmark and Sweden.
Could less hours be the answer?
In Greece, workers clock on average 2000 hours of work a year, 500 more than the French. Yet Greece’s productivity wanes in comparison, even though they work more they do not produce better value, paying homage to the quality over quantity adage. Interestingly, US workers work more hours than UK workers on average and this inevitably produces a higher output per worker than output per hour worked. And although workers in Germany work less hours their output is higher per hour than UK workers. So it follows that UK workers either are not working hard or are not working smartly.
Another notable trend in the statistics is that Germany work less hours per week on average than all other countries in the G7. There has been a trend across G7 countries towards lower working hours, however, since the economic downturn this trend has been reversed in the UK with average weekly hours on the rise. Historical analysis has shown that shorter hours creates a higher output, and this just might be what UK companies need to turn productivity around in their own businesses. The long-term wellbeing of staff has been a strong theme, emphasised in recent years by the challenge of an ageing population. The data convincingly warrants shorter working weeks and potentially more day’s holiday to increase overall workforce productivity in the UK. So the next time you are reviewing your company policies, perhaps consider giving your employees a few extra days holiday a year or longer breaks, olé office siestas.
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