Why we need a more critical stance on the relationship between wellbeing and productivity
Wellbeing and productivity are typically assumed to be positively related, but our review suggests that this may not always be the case. It is crucial that we start to take a more critical view of this relationship, Amy Isham writes, introducing her recent working paper with Simon Mair and Tim Jackson.
The relationship between wellbeing and labour productivity is receiving increased attention. This is unsurprising, given the highly publicised problems of slow labour productivity growth and poor workforce wellbeing in the UK. Current understandings typically assume a positive relationship between wellbeing and labour productivity/productivity growth. Increases in productivity are assumed to raise incomes and thus wellbeing. At the same time, employee wellbeing is considered to drive greater levels of employee and firm-level labour productivity. However, our new working paper suggests that the relationship may not be so straightforward.
Guided by discussions with researchers from backgrounds including psychology, sociology, economics, and design, our review takes a broad, interdisciplinary perspective on the association between wellbeing and productivity. We consider how the relationship may be explained by certain personal, organisational and environmental factors, be bi-directional in nature and positive or negative across different contexts. Three main themes emerged from the works.
The first was that individuals displaying higher levels of wellbeing do tend to report higher levels of labour productivity. This is often referred to as the ‘happy-productive worker’ thesis. We found this pattern to be consistent across multiple aspects of wellbeing, including physical health, mental health, subjective wellbeing (life satisfaction and positive feelings) and stress. Raising levels of employee wellbeing may therefore provide a means of promoting productivity growth. Research documenting direct, causal effects of wellbeing on labour productivity help to support this assumption. For example, inducing positive feelings through humorous videos has been shown to lead to greater task performance in experimental research and workplace interventions designed to improve employee wellbeing have documented concurrent gains in organisational productivity.
The second emerging theme was that, although certain studies have documented causal effects of wellbeing on productivity, a large proportion of the literature in this area is still only correlational. This means that there may be further factors that can promote both higher levels of wellbeing and productivity, and thus partly explain why a positive association between these two factors is often documented. We identified four factors that may be able to partly account for the positive association between wellbeing and productivity: human capital, social capital, ICT and physical aspects of the workplace. To use social capital as an example, when employees have strong relationships and trust each other, this allows for voluntary cooperation and the effective sharing of skills and information amongst employees (thus boosting productivity). At the same time, quality relationships support personal wellbeing by providing a sense of belonging and relatedness.
So the evidence base supports a positive relationship between wellbeing and levels of labour productivity, and there appear to be a number of factors that could explain this link. However, a third trend also emerged whereby factors related to the pursuit of productivity growth may have the potential to undermine wellbeing.
We identified four means through which these negative effects of productivity growth on wellbeing could occur: by leading to poorer healthcare being provided, by increasing job demands and job insecurity, by increasing the use of ICT which can create a perceived need for constant availability and promote sedentary lifestyles, and by depleting valuable forms of natural capital. Let’s use the first means as an example. Since the 1980s, private-sector management practices have increasingly been introduced in the NHS in attempts to improve productivity. But healthcare professionals have tended to view this managerialism as an intrusion on their professional practice and ethics of care. The increased demands created by the additional accountability for the efficiency of care provided also heightens difficulties in caring for patients, leaving some receiving less personalised or intensive care. The requirement to grow productivity within the healthcare sector therefore appears to lead to poorer quality care services being provided, which in turn will negatively impact upon individual health and wellbeing.
Altogether these themes reveal an alarming problem. Short-term productivity growth has the potential to negatively impact upon individual wellbeing. Yet individual wellbeing is an important determinant of higher levels of productivity. Assuming a link between the productivity levels of individuals and productivity growth, then productivity growth in the short run is likely to reduce productivity growth in the long run.
If we acknowledge that productivity growth has the potential to undermine wellbeing (and thus productivity itself) then we need new critical perspectives on the inherent value of productivity growth and the way in which it is pursued. Indeed, researchers have argued that slower productivity growth can reduce threats to employment, promote ecological sustainability and create more meaningful work as the focus shifts from quantity to quality. CUSP’s work is continuing to explore how we might live in a society whereby productivity and economic growth are not at the heart of prosperity.
