After worker productivity rose to record levels during the first two times of the COVID-19 epidemic and the shift to blended and remote work, it fell sharply in the first half of 2022 – leaving experts scratching their heads as to why.
The US Bureau of Labour Statistics released data for the third quarter recently, showing that business productivity barely rose – up to 0.3% from the previous quarter – and the employment ratio rose just about 2.8%.
But compared to the same quarter a while ago, productivity is still down 1.4%, the first time productivity has fallen three times in a row since 1982. “The reasons are more specific than just hiring laziness,” said Sinem Buber, chief economist at ZipRecruiter.
People see no reason to make more effort. They are also burned out. Generally, during recessions and low gross domestic product (GDP), employers reduce hours and lay off workers to reduce the decline in the ratio.
But due to the extreme lack of donations and high levels of attrition, where workers, especially knowledge workers, resigned in record numbers, unions held back layoffs.
A smaller workforce also means additional pressure to maintain or increase staff. The decline in worker productivity has coincided with many unions taking workers back to the office.
According to a recent review by Resume Builder, in 2023, employees at 90% of companies will return to the office for at least part of the week. And a fifth of companies said they would fire workers who refused.
Caroline Walsh, vice president of Gartner’s human resources research practice, said there are no solid answers as to why the productivity of corporate workers has declined so dramatically.
Employers and economists now need to ask more questions before making snap decisions about jobs programs, he said. While some managers publicly claim that forcing workers to return to their offices increases productivity, research doesn’t support that, Walsh said.
We saw a knee-jerk reaction before this. We know CEOs and other managers were upset that work wasn’t being done, but we didn’t see work not being done — until the unions started demanding back in the office,” Walsh said.
When connections dictate presence in the office, they typically provide employees with three pieces of information that keep coming back; when they will return; and how often they return.
However, according to Walsh, they often don’t tell employees why they need to return to the office. It’s incredibly draining and liberating for employees, especially those who have proven over time that they can work, which can increase the sense of growth,” Walsh said.
Forcing them into the office or covering remote workers with software that monitors their workload usually leads to showing off — pretending to work more via video conference or sending more emails, but with no real productive connection, Walsh explained.
Another thing that affects productivity, Buber argued, is motivation. When new employees are hired, they often come with pay and benefits that are equal to or better than experienced employees.
When companies raise grants for their endowment, it often doesn’t consider antiquity at all. “So the connection between hard work and lifting is broken,” said Buber.
However, starting with growth in the third quarter, Buber expects productivity to return to the levels seen in the first two rounds of the epidemic as major attrition slows and workers settle into a new normal.