by David Clendon
The latest report from the Productivity Commission, ‘Productivity by the Numbers : The New Zealand Experience” offers a snapshot of the productivity performance of New Zealand’s economy. Sadly, it confirms what is generally well known, that as a country we feature at the wrong end of the relevant statistics. We are told that “New Zealanders work about 15% longer than the OECD average to produce about 20% less output per person”.
Not only is our productivity very low in both relative and absolute terms, but our rate of growth in productivity is also in the doldrums. This does not bode well for our collective wellbeing, either now or in the future.
With all due respect to the authors of the report, who have produced a solid piece of work and no doubt fulfilled the brief they were given, I find it very frustrating that almost three years after its establishment the Productivity Commission is still fiddling about gathering data about the nature of the problem, and promising to do ‘further research and inquiries’, to periodically ‘publish a productivity outcomes monitoring report [series]‘ starting next year.
The problem has been identified, analysed, scrutinised, sliced and diced for years – note for example a speech from the Secretary to the Treasury in 2008. There is no simple one off solution to raising our productivity, but there are some very obvious and practical steps we could be taking right now, as I pointed out in a (much) earlier blog on the issue.
One of these is to educate and encourage more businesses to understand the value and importance of staff engagement. There is ample evidence that companies who listen to their staff, involve them more intimately in the business, who give people reason and purpose to actually think about how they can do a better job, and reward them for that attitude, invariably do better. The skill is to create a positive and affirming workplace culture, a place where people want to do well. This is not high-minded abstract theory, it is based on practice, observation and measured outcomes.
Investing in people, their skills and wellbeing, is not always easy, but is probably the single best investment any business can make. Government’s time and resource would be much better spent supporting business to get on with implementing this and similar strategies that are tried and proven to work, rather than simply adding to the already voluminous literature about the nature of the problem.