Nearly two-fifths of large UK companies called their productivity levels “very concerning” but big firms are investing only 0.25 per cent of their annual turnover to remedy the problem, new research has revealed.
A survey by the Centre for Economics and Business Research (CEBR) and analytics firm Concentra Analytics shows that a third of large organisations are spending less than £10,000 a year on developing knowledge of where their staff’s productivity can be improved.
It comes as Britain continues to be gripped by a productivity crisis. UK productivity – output per hour worked – fell for the third successive quarter in the first three months of the year, according to official figures released earlier this month.
Increasing productivity is central to improving living standards, as it creates wealth. But the Bank of England has said productivity is around 20 per cent below where it would have been had it continued at pre-financial crisis levels.
CEBR and Concentra said their report had “uncovered a spray and pray approach to driving productivity”. They said companies did not know “whether their people are in the right place, or doing the right thing”.
Instead large companies were snapping up new technologies and encouraging changes such as automation without properly thinking through how they could best be used to increase workers’ productivity.
The research spoke to 400 businesses in the UK and US with more than 1,000 employees.
CEBR economists estimated in the report that UK GDP could grow by £10.4bn in the coming years if employers develop a better understanding of how their employees’ productivity can be boosted.
Kay Neufeld, head of macroeconomics at CEBR, said: “There is a clear correlation between organisations that are most productive and have both macro and micro insight into employee productivity.”
Rupert Morison, chief executive of Concentra Analytics, said: “Getting better information on people and what they’re working on improves productivity by making sure the right people are in the right place at the right time to deliver the operating plan.”