One of the biggest predictors of company growth? Productivity. It’s how organizations achieve more in less time, with fewer resources and lower operational costs.
In other words…
If you’re not actively looking for ways to increase productivity among your employees, now’s the time to start.
To help, let’s look at the latest research and employee productivity statistics — plus how you can apply the findings in your workplace.
1. Addressing disengagement is key
You’ve likely heard about the tie between employee engagement and productivity, which has been widely reported for years. Organizations with high engagement are 14-18% more productive (and 23% more profitable) than minimally engaged companies. So it’s no surprise the employee engagement market is projected to reach $3.6 billion by 2034.
However, many organizations are so focused on boosting morale and job satisfaction that they overlook the much bigger issues of disengagement.
Disengaged employees aren’t just mentally checked out. They also have 37% higher absenteeism and create 60% more errors. And according to Gallup, they cost companies $8.8 trillion in lost productivity every year. Sometimes, they’re great at their jobs but detached from the company’s mission. In other instances, they perform poorly and negatively impact colleagues.
What to do about it: Reverse these trends at your organization — or prevent them from taking hold in the first place — by using proven strategies to motivate disengaged employees. For example, expanding opportunities for career development is a great way to increase job satisfaction and provide a sense of purpose.
2. Collaboration is more than jargon
Workplace collaboration isn’t just a buzzword — it’s essential to success. In fact, high-performing organizations are up to 5.5 times more likely than lower-performing companies to incentivize workforce collaboration. When teams and departments work together, the result is faster problem-solving and more innovation.
However, it’s possible to overdo it.
Time spent on video calls, email, live messaging and other virtual collaboration activities has risen 50% or more over the past decade. They now consume 85% of most employees' work weeks, starting earlier in the morning and extending further into the evening. The resulting “collaboration overload” often sinks productivity by hurting people’s chances of staying on task.
What to do about it: Focus on creating a work environment where collaboration is commonplace but doesn’t detract from equally important focus time. Not sure where to start?
3. Wages make a difference
Although it’s still a relatively new area of research, several studies show a clear connection between higher wages and productivity. Higher compensation increases loyalty and commitment, boosts motivation and, in some cases, leads to reciprocation — the natural tendency for people to give back to those who have already given to them.
In one study, raising the minimum wage for employees resulted in 4.5% more sales. In another, researchers concluded that “gifting” employees with unexpected pay raises compels them to work harder — making it just as effective as hiring more people.
Of course, there are plenty of other ways to boost productivity. And compensation isn’t always a viable (or necessary) option. So while it’s good practice, increase wages only after careful consideration.
What to do about it: Look for signs that it's time to increase wages at your organization, such as high turnover or a reduced workforce. And measure productivity trends within your own workforce to understand what factors are most motivating for your employees.
4. Flexible work is a game changer
Hybrid and remote work arrangements also impact productivity — at least in an indirect way. One massive study found organizations that let employees work from home at least two days a week experience higher satisfaction and lower resignation rates, with no negative impacts on productivity. The finding is important because it comes two years after 85% of business leaders said the shift to hybrid work makes it hard to trust employees to stay productive.
But that’s not all. Another survey found hybrid and remote workers are far more satisfied with work-life balance than full-time office employees. While that might sound like a separate issue, in reality, it has a huge impact on productivity. Researchers have long explained why consistently working more than 40 hours a week is not only unproductive but also harmful. You get the same level of output from an eight-hour day as a ten-hour one, but pay more for it — either as overtime or in the form of burnout.
What to do about it: Test different types of flexible work arrangements to determine what works best for your organization. In addition to hybrid and remote work, many companies have success with flex time, results-only work and four-day workweeks.
5. AI and automation will continue to climb
For many organizations, the secret to improved productivity lies in AI and automation. McKinsey Global Institute predicts up to 30% of hours currently worked could be automated by 2030 thanks to generative AI. And according to Gartner, gen AI will be a workforce partner for 90% of companies by 2025.
The reason is simple: AI frees employees from manual tasks, allowing them to focus on important work and big-picture projects. For example, one survey found marketers save three hours or more on each piece of content they create with generative AI, while sales and customer service professionals automate two hours’ worth of work each day.
As a result, 79% of surveyed business leaders expect generative AI to transform their organizations within three years. However, many worry about potential negative impacts if it’s not implemented properly.
What to do about it: Take time to understand which AI tools employees use, and to what extent, to ensure you reap the benefits without incurring risks.
6. It’s critical to monitor employees the right way
With the move to remote and hybrid work, many organizations are opting to monitor employees. However, many business leaders still struggle to do it right. The vast majority of employers believe employee monitoring software has increased productivity among their remote workforces — but many of their employees disagree. In fact, 69% of companies say employees have quit because they don’t want to be monitored.
That’s because, instead of monitoring important productivity metrics, many organizations use employee monitoring tools to conduct live video surveillance and micromanage employees.
In contrast, organizations that monitor metrics like burnout and disengagement reap rewards. For example, 92% of workers are open to having employers collect work data if it improves well-being or provides other personal benefits.
What to do about it: Rather than surveilling employees, use productivity dashboards to understand what people need to do their best work.
7. Intentional productivity practices pay off
According to ActivTrak’s 2024 State of Workplace Report, employees were eight minutes more productive each day in the first half of 2023 than the second half. While that might not sound like much, it translates to additional workload capacity of 18 full-time employees, or $1.1 million, at a 1,000-employee organization with an average annual salary of $60,000.
In other words…
Organizations have an opportunity to significantly lower operational expenses, simply by focusing on finding ways to help employees remain productive year-round.
What to do about it: Use productivity management software to see where, when and how your employees work best — and use those insights to guide policies and programs.
Get a better understanding of productivity in your organization with ActivTrak
Ready to put these findings into practice at your organization? ActivTrak's productivity monitoring software provides a wealth of insights to get you there fast. It’s the easiest way to determine what your teams need to stay productive long-term.
Join more than 9,500 organizations that already use ActivTrak by signing up for your free account today. And if you’d like more inside tips, schedule a demo to meet one-on-one with a productivity expert.