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HR has a role to play in tackling productivity

9 May 2019 By Matt Weston

Training, recruitment and culture are all vital tools in getting more from your people, says Matt Weston

With the UK experiencing stagnating productivity growth at the same time as record levels of employment, it is clear the economy is facing a ‘productivity puzzle’. Figures from the Conference Board, a US non-profit research group, revealed Britain is the only large advanced economy likely to see a decline in productivity growth this year. Meanwhile, the ONS reported UK workers’ productivity had fallen in the final three months of 2018, down by 0.1 per cent compared to the same quarter a year ago, the second year-on-year quarterly fall in a row.

While this is a problem across the economy as a whole, if businesses are to succeed, they must focus on improving their own productivity by hiring, retaining and equipping their employees to thrive in today’s rapidly changing business environment.

Productivity is a crucial dimension of business success, ensuring companies maximise the output achieved from their available resources and human capital. Given the prevailing economic uncertainty, along with shifting global dynamics, productivity for many UK businesses could mean the difference between failure and success.

The impact of high or low productivity can be self-reinforcing within a business, with only those with high productivity able to invest – be it through equipment, technology, training or remuneration – in order to attract top talent and enable business growth.

What businesses can do

To combat the productivity puzzle, employers need to focus on how best to motivate and enable their workforce. One important element of this is to boost morale by creating a happy and engaged workplace. This can be achieved through a range of managerial and cultural factors, but employers should seek to create an environment where employees feel they are appreciated, have a sense of empowerment, participate in interesting and meaningful work, and have positive workplace relationships. 

Regular training, as well as a clearly defined career path, are vital to establishing a motivated workforce and retaining employees. When employers get this right, a happy and engaged workforce is undoubtedly a productive one.

Beyond culture, productivity can be improved by investing in technology and training. In today’s rapidly changing world, technology and digitalisation are transforming virtually all businesses by making processes and interactions more streamlined and efficient. By investing in technology, as well as the training to upskill staff to use that technology, businesses can increase their productivity and improve their bottom line.

Recruitment and retention

In an environment where change is the new normal, another important part of addressing productivity is to ensure businesses are equipped to adapt. This can be achieved both by attracting candidates with in-demand skillsets, as well as adopting flexible recruitment solutions to plug short- term skills gaps.

Constantly fluctuating need creates demand for specific skillsets, such as those surrounding new technologies, but also soft skills such as communication, flexibility and adaptability that are essential for employees to manage periods of change. To meet these demands, companies must think carefully about the skillsets required of their employees, assessing technical and soft skills as part of their recruitment process. 

When employment levels are high and there is increasing demand for particular skillsets, businesses must also be prepared to adopt a flexible approach to recruitment. Flexible staffing options, such as hiring interim workers, can help achieve the necessary balance between supporting existing staff and filling the necessary gaps, ultimately boosting productivity and giving businesses the flexibility they need to scale their workforce and execute growth strategies.

While the UK economy at large is experiencing a productivity puzzle, companies wishing to thrive must do all they can to improve their own productivity. To do this, recruitment, retention, investment and training all play an important part in motivating and enabling an effective, engaged and productive workforce.

Matt Weston is managing director of Robert Half UK

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