Bruce Daisley: "We must first lower the resignation rate to solve productivity issues"

The productivity paradox

The last few months have seen an increasing volume of concern around productivity levels of remote work.

What is productivity? By strict definition it is the amount of work performed by each unit of a person’s time (work per person hour), but it’s often taken to mean the amount of work people get done in their jobs.* Last month a report from a think tank, The Centre for Cities, added to the voices claiming that homeworking is killing productivity.

The report said that public transport usage is currently only at a fraction of pre-pandemic levels and the average office workers was spending 2.3 days in the office. It sets about attributing this decline in office time with the economic difficulties that cities are experiencing. It’s a strange report, not least because it admits, ‘There is no strong evidence either way to provide any insight on what has happened to productivity since 2020’.

This is one of the perennial challenges of productivity, when someone is working at a computer all day it’s not easy to measure whether they’ve created a lot of value, or very little. This dissonance is reflected in what Microsoft’s research describes as ‘Productivity Paranoia’ – 88% of us think that we’re productive working at home, but only 12% of our bosses agree with us. Managers fret that we’re not grafting like we used to.

A misinterpreted connection

It should be emphasised that for all of the claim, what the Centre for Cities report is describing isn’t productivity, it is the economic activity of city centres. For illustration in the midst of the first lockdown in April 2020 there was no economic activity in city centres, but that doesn’t mean that productivity was zero.

If we’re serious about productivity then this report is a red herring. Yes, there is reason to worry about the health of city centre ecosystems but ordering millions of workers to make a daily commute to keep Pret bustling isn’t a way to boost productivity, if anything lumbering them with an hour of unproductive commuting time each day is a productivity drain, a relic of the way we used to work. To make London thrive didn’t depend on us preserving the bustling docks of the 1950s, cities adapt and change with the passage of time.

“High employee turnover is ruinous for productivity”

That’s why, in comparison, my discussion with Professor Zeynep Ton last month was so enlightening. Unlike the likes of the Centre for Cities, or the OpenAI boss, Sam Altman, or the remote working billionaire, Ton has data.

If you want to understand why productivity is falling, she suggests we need to look first at high levels of employee turnover. If we want to solve productivity issues the first step needs to be to lower the resignation rate.

We all know well when people quit their jobs a period of unproductivity commences: bosses and colleagues need to cover the work of the person leaving, the recruitment process takes unproductive attention and new starters take months to ramp up. As Ton says, ‘high employee turnover is ruinous for productivity’.

At one stage in Ton’s new book, The Case For Good Jobs, she says something that stings with painful truth: ‘Companies that operate with high turnover tend to rely largely on computerised training. You might spend ten hours and go through all the modules without paying any attention and be paid for learning almost nothing’. Yes, we’ve all been there, creating a training deck to be completed online. But we’ve also been the person inattentively guessing answers and skipping through.

Zeynep Ton is a professor of operations at MIT. She studies supply chains and how business can operate most profitability. It was while she was conducting her research that she encountered a fundamental truth, ‘so many of the problems related to inventory happened in the last ten yards of the supply chain’. Meaning the issue happened in the store. ‘When I looked into why these problems happened all the time, I met the human side of operations’.

Ton’s work showed her that high employee turnover was ruinous because it created chaos, it took away the people who acted as the glue to broken systems. If we’re to solve the productivity conundrum we need to think more about keeping top talent, and less about suspecting them of being idle.

*This is an important distinction, if the average working day has been extended by out of hours emails, by rights this lengthening of the day should see a decline in productivity – as the same amount is produced in more time.

---

Bruce Daisley is a workplace culture consultant and the host of Eat Sleep Work Repeat podcast.