Positive links between health, safety and productivity

The literature review found compelling evidence of many potential benefits for New Zealand businesses of the links between health, safety and productivity, including:

• fewer injuries that stop people from working

• increased innovation

• improved quality

• enhanced corporate reputation

• reduced ACC levies

• lower costs to compensate workers

• improved staff recruitment and retention.

Over the past five years, the number of studies measuring the effects of health and safety on worker productivity have increased dramatically, as employers strive to understand and control health care costs. More fundamental, however, is the growing recognition that productivity drives economic growth and profits, and may create a competitive business advantage.

Ingredients for success

The literature identified a number of common success factors in businesses that demonstrate the links between work quality and productivity including:

• a high-quality working environment
• good levels of co-operation between management and employees
• work organisation that gives employees challenges, responsibilities and job autonomy
• the development of new working methods and equipment to improve working postures and decrease the strain of physical work
• allowing creative solutions for specific safety and health problems
• a thorough analysis of the different production costs that can be directly or indirectly related to health and safety hazards (costs of incidents, loss of productivity and quality, and other production costs due, for example, to the use of inadequate materials).

In addition, the literature identified the need for both employers' attitudes and employees' behaviours to change in order to reduce injuries, disease and deaths, and increase performance and productivity.

Indicators for health, safety and productivity

Performance indicators are essential management tools for measuring the successes of prevention and intervention programmes. Developing effective indicators is vital to clearly establish the link between business profits and a company's investment in workplace safety and health.

Research suggests shifts are emerging away from retrospective 'negative' measures of healthy and safety and more towards a 'basket' approach of more sophisticated measures. These more sophisticated measures provide information on a range of health and safety activities - both positive and negative.

The positive indicators measure pro-active initiatives towards achieving a target (such as audits, which can identify practices to improve), while negative indicators (such as the number of incidents) show whether the target is being reached.

Research opportunities

Importantly, in order to inform the increased levels of research and investigation into the positive links between health, safety and productivity, the literature review identified several research opportunities, including:

• developing consistent and accessible performance measurement tools
• critiquing different health and safety interventions and preventions
• investigating safety culture.

Historically, policy and research on the connection between occupational health and safety (OHS) and increasing productivity and performance has been largely overlooked.

Interest in improving workplace productivity is shared by both industry and government. However, to date, the tools to understand this area have mostly been provided by economists and accountants, which means the measurement of productivity and performance is typically described by a narrow set of output or budget indicators.

Despite this, health and safety practitioners, enforcement agents, progressive businesses and OHS academics have long recognised the economic and social benefits of introducing improved health and safety measures.

This report, derived from a wide-ranging review of New Zealand and overseas literature, begins to address this historic oversight and broaden the context within which health and safety is understood.