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|UK productivity shows little sign of improvement|
|Monday, 18 July 2016|
ONS Figures released today show that UK productivity has continued to stagnate with an output per hour increase of only 0.5 per cent for Q1 2016, compared with Q4 2015. The UK infamously received the accolade of having the lowest productivity in the G7 in 2015, and these figures show that the trend is set to continue.
Despite this, the UK is predicted to become the best performing economy in Western Europe, soon to take over Germany. The struggling productivity rating is not having an overriding negative effect on the economy, so businesses should look to calculate it with other factors incorporated.
Farida Gibbs, CEO and Founder of Gibbs S3, comments: “Productivity has recently been used to criticise UK businesses, and indirectly their employees, but this is not an accurate consideration to take. It looks simplistically at the total output compared with the overall input.
“When it comes to individual businesses, this is just not an accurate way to determine how well things are going. Employees may go the extra mile with a customer, which can be crucial to long-term client retention and key to all business success, but this does not necessarily give back an instantaneous increase of output.”
Some employers in Sweden recently introduced a six-hour day in an attempt to boost productivity, believing that valuable time spent is more productive than longer shifts. The report found that employees were 20 per cent happier, as well as 2.8 times less likely to take time off work over a fortnight period.
Farida Gibbs continued: “It is better to judge overall businesses performance based on a wide range of factors, from KPIs, customer happiness and overall cash flow to the business. When it comes to individuals’ performances, it is often too simple to determine how well they are doing based on output. They could be putting in extra work to keep a customer happy, as well as offering time to support and assist colleagues, so it is always crucial to take a realistic approach, rather than just relying on the final numbers.
Gibbs S3 is one of the UK’s fastest growing SMEs, seeing annual revenue increase 53 per cent in 2015 to £49.7 million.
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