Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Is it in our interest to meet Brown’s goal?

by Personnel Today 9 May 2001
by Personnel Today 9 May 2001

If prudence is Gordon Brown’s favourite word, productivity comes a close
second. The Chancellor wants the UK to start to outpace the US, France and
Germany and move up the league table of the world’s most productive economies.

This objective can seem little more than economic machismo – until you
translate it into hard cash. If the average British worker was as productive as
the average American, the UK economy would each year produce an extra £6,000 of
goods and services per head of population. That’s megabucks. It would allow
higher profits and higher pay, and provide scope for extra spending on schools,
hospitals and public infrastructure without raising taxes.

No wonder the CBI and TUC have put other differences to one side to discuss
how the Chancellor can meet his productivity goal. No surprise either that the
CIPD is putting ever-greater effort into demonstrating the central role of
people management in boosting productivity. As CIPD research shows,
organisations applying a range of people management tools are about a fifth
more productive than other organisations.

A key message must be, don’t confuse measures that improve the effectiveness
of staff with costcutting strategies that boost productivity at the expense of
jobs.

The latter approach can appear to make sense, especially during periods of
economic slowdown. Indeed, at the time of the last recession, this was
precisely what advocates of downsizing told us. "Slash and burn" said
management gurus, who advised employers to make maximum use of their enhanced
ability to hire and fire.

But by the mid-1990s the same gurus suddenly started talking about the
downside of downsizing. Large-scale job culls break the necessary bond of trust
between managers and workers that underpins commitment and motivation – so any
gain to productivity tends to be temporary.

There are times when employers may have to resort to mass redundancies – a
major slump in demand, or inefficient operation. But during the kind of
slowdown the UK economy is likely to experience during the coming year, most
organisations should hoard rather than shed labour.

Encouragingly, this is precisely what happened during the downturn in 1999.
Although manufacturing shed jobs under the weight of the strong pound, the bulk
of employers held on to staff. The prevailing rationale was that the downturn
would be short-lived and laid-off workers might be lost to competitors. The
irony is that as a result, economy-wide productivity dropped in the late 1990s.
But the preservation of jobs helped sustain consumer demand and allowed the
economy to quickly return to health.

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

And unlike the early 1990s, job satisfaction and the psychological contract
at work remained robust. Let’s hope the same happens in the coming year. Better
for productivity to take a short-term dip than hinder long-run progress toward
a high productivity, high employment economy.

By John Philpott
Chief economist, CIPD

Personnel Today

Personnel Today articles are written by an expert team of award-winning journalists who have been covering HR and L&D for many years. Some of our content is attributed to "Personnel Today" for a number of reasons, including: when numerous authors are associated with writing or editing a piece; or when the author is unknown (particularly for older articles).

previous post
General Election is on 7 June
next post
Employers in spotlight over immigration row

You may also like

Forward features list 2025 – submitting content to...

23 Nov 2024

Features list 2021 – submitting content to Personnel...

1 Sep 2020

Large firms have no plans to bring all...

26 Aug 2020

A typical work-from-home lunch: crisps

24 Aug 2020

Occupational health on the coronavirus frontline – ‘I...

21 Aug 2020

Occupational Health & Wellbeing research round-up: August 2020

7 Aug 2020

Acas: Redundancy related enquiries surge 160%

5 Aug 2020

Coronavirus: lockdown ‘phase two’ may bring added headaches...

17 Jul 2020

Unemployment to top 4 million as workers come...

15 Jul 2020

Over 1,000 UK redundancies expected at G4S Cash...

14 Jul 2020

  • 2025 Employee Communications Report PROMOTED | HR and leadership...Read more
  • The Majority of Employees Have Their Eyes on Their Next Move PROMOTED | A staggering 65%...Read more
  • Prioritising performance management: Strategies for success (webinar) WEBINAR | In today’s fast-paced...Read more
  • Self-Leadership: The Key to Successful Organisations PROMOTED | Eletive is helping businesses...Read more
  • Retaining Female Talent: Four Ways to Reduce Workplace Drop Out PROMOTED | International Women’s Day...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+