How to Combat Declining Worker Productivity

One of the bright spots in recent news is the downgrading of the COVID-19 pandemic: the World Health Organization (WHO) now says it’s no longer a global emergency, which should certainly ease a lot of uncertainty across the world, especially for small businesses that seemed to bear the brunt of the pandemic’s economic destruction. But the list of concerns for small business owners is still lengthy… on top of high inflation and worker shortages, recent news from the Bureau of Labor Statistics (BLS) highlights a decline in worker productivity—the largest in 75 years, according to data. Year-over-year productivity has gone down for 5 consecutive quarters at the fastest rate in nearly a century. This trend may continue for additional quarters as the economy slows and we head into recession territory.

The question is, why is productivity declining? How did we get here when unemployment is so low and the labor market so strong? The answer might lie in the fact that demand for goods and services has slowed, but the hesitance of businesses to lay off workers means there are too many employees for the amount of available work. If your business is experiencing declining productivity, read on for tips on how to combat this scenario.

Look to New Technologies

Many small businesses are working hard to digitize and automate their processes, which is a great way to increase productivity and ROI. While making the switch to a digital model might be costly at first (it’s a great candidate for a revolving line of credit), this transformation will pay off in the long run. As noted on RICOH’s website, “A successful digital transformation should lead to higher employee engagement by empowering employees to make informed decisions quickly, which allows them to experience a collaborative work environment that enables them to share innovative ideas that lead to healthy business growth.”

Empower Your Team 

We’ve all be under the thumb of a micromanager, and nothing does more harm to employee morale and productivity than a leader with his nose in every aspect of your job. When businesses trust their employees to own their own schedules, workloads, and activities, workers feel more empowered—like they have a seat at the table of their company. Empowered employees trust their leaders more than micromanaged ones—and this creates more collaboration, innovation, and ultimately productivity. The confidence that comes from feeling like a true partner is what makes businesses successful.

Focus on Collaboration

Collaborative, innovative work environments lead to employees that are significantly more satisfied with their jobs—and job satisfaction is a huge way to increase productivity. Collaboration tools, some as simple as a company intranet site, allow workers to see what’s happening across the organization and share news and ideas with each other. It’s also a great space to solicit feedback from workers on what they’d like to see more or less of at the company.

Stop over at the Financial Pantry, where we’ve got all the informative content you need to run a successful business. And if you’re in the market for top-of-the-line loan products that can easily be tailored to meet your business goals, our expert loan consultants are ready to assist. What are you waiting for? Stop by today to learn more about how ARF Financial can help finance your success.