Workplace Productivity Employers Survey Executive Summary

Introduction and background

Workplace productivity

In December 2003, Cabinet Business Committee agreed to the establishment of the Workplace Productivity Working Group (WPWG), to advise the Government on practical ways to improve New Zealand's productivity performance. Subsequent to recommendations made by the WPWG, a Reference Group to support implementation of the Government's Workplace Productivity Agenda (the Agenda) was established.

The report of the WPWG identified a number of issues relating to information and access to information, which limit: The extent to which employers and employees in workplaces in New Zealand are able to take action to lift workplace productivity.

Information costs, in particular, have been identified as a major barrier to improving productivity.

In order to address the issues identified by the WPWG, a strategic communications programme, intended to engage all of the key stakeholders, is currently being implemented by the Department of Labour in conjunction with Business NZ, Chambers of Commerce and NZCTU (New Zealand Council of Trade Unions)

1. To continue to raise the profile of workplace productivity,
2. To keep the Workplace Productivity Agenda 'alive', by promoting the benefits and opportunities of productivity improvements.

Purpose of research

BRC Marketing & Social Research (BRC) was commissioned in June 2005 by the Department to conduct a series of quantitative research studies with both employers and employees. The findings from the benchmark employers survey are covered by this report,

Objectives

The main objectives of the employers research were to:

1. Examine attitudes to employment-related workplace practices, as a means of lifting workplace productivity (including work organisation, management and leadership practices, and training and development).
2. Identify the relevance and significance of various types of employment related practices, used to lift workplace productivity.

With these research objectives in mind, the information objectives of the employers survey were to identify:

• The practices employers believe will improve productivity.
• The actions being put in place in workplaces to improve productivity and work-life balance.
• Employers' perceived barriers to improving productivity and work-life balance.
• Where employers go for information on lifting productivity.
• How these answers vary according to workplace size and industry.

The work-life balance findings from the benchmark employers survey are provided in a separate report titled "Work-Life Balance in New Zealand" available from www.dol.govt.nz/worklife/quality.asp

Methodology

Questionnaire design

The questionnaire was designed in consultation with the Department of Labour. Once a preliminary version had been agreed to, it was then subjected to a pilot survey with a sample of n=30 randomly selected employers.

Following the pilot, minor changes to the wording of some questions were made.

Sample and sampling error

For this survey, a sample of n=1,100 employers (with 5 or more employees) from business with telephones were interviewed.

The sample was acquired from APN Iris Data (formerly UBD) and drawn from the APN InfoMedia database of New Zealand businesses.

In order to maximise the opportunities for drawing conclusions about the extent of differences amongst different industry types, a stratified, random sampling approach (based primarily on the ratio of enterprises across 9 different ANZISC Industry Groupings) was used, wherein BRC over-sampled certain industry groups to ensure minimum sub-samples of at least n=100 employers (with 5 or more employees) were interviewed in each Group.

This approach ensures that statistically robust sub-samples were achieved within each of the different industry classifications selected, allowing for confident comparative analysis within and between industry groups, while also providing statistically robust and representative findings at the national level.

Weighting of employers' sample and sampling error

As a result of over-sampling employers from certain industry groups to achieve robust sub-sample sizes, certain industry groups were slightly over or under represented beyond their normal proportions. To account for any potential impact this may have had on the overall results during the analysis and reporting stages, the achieved survey sample was weighted to reflect the true proportions of the number of enterprises represented across the 9 ANZSIC categories.

The maximum margin of error, at the 95% confidence level, for the overall results is ±3.1%.

Interviewing processes

The interviewing for this research was conducted by telephone from BRC's purpose-built call centre in downtown Wellington between 30 June and 2 August 2005.

Pre-notification letters were sent to the most senior executives on the APN InfoMedia record to all workplaces in the sample, to advise that a BRC interviewer might contact them.

Eight attempts to contact each selected workplace were made before the attempt to obtain an interview was abandoned, and a different workplace from the sample was substituted in its place. The average length of each interview was 20 minutes.

The overall response rate for this survey was 23%¹ .

Limitations of the survey

It should be noted that this survey was conducted with businesses with five or more employees in 9 specific ANZSIC Groupings:

• Manufacturing.
• Retail Trade.
• Property and Business Services.
• Health and Community Services.
• Education.
• Wholesale Trade.
• Accommodation, Cafes and Restaurants.
• Construction.
• Transport and Storage.

Therefore the survey results do not necessarily represent the views and practices of New Zealand employers in the Government Administration and Defence sector, the Agriculture, Forestry and Fishing sector, the Mining Sector or Electricity, Gas and Water Supply sector. Nor do they necessarily represent the views and practices of employers of 4 or less employees in the 9 ANZSIC Groupings listed above² .

While a response rate of 23% for a telephone survey of employers is not atypical, it should be noted that it is on the low side of average and there may be an inherent response bias in the results as detailed in this report, (i.e. given that employers were pre-notified about the survey and it was disclosed that the focus would be on workplace productivity and work-life balance issues, it is not an unlikely hypothesis that those employers who did respond might be more amenable to the concepts of lifting productivity and improving work-life balance than those employers who did not respond, and thus are more likely to have implemented such practices).

As the effects of non-response upon the results can not be estimated for the purposes of analysis and reporting because the characteristics of those who did not respond are unknown, the reader should exercise some degree in caution in interpreting the results, as they may over-estimate the true degree of awareness and implementation of certain practices among the industries covered.

Summary findings

What the term workplace productivity means to employers

All employers surveyed were asked what the term 'workplace productivity' meant to them. As detailed below, the most frequently mentioned responses were:

• The volume of output/sales/number of hours worked (29%).
• Getting the most/best out of employees (28%).
• Working efficiently/effectively (26%).
• The ratio of input to output (11%).

For the most part, there were no significant differences in employers' perceptions of what workplace productivity meant to them, when viewed by Industry Grouping or size of the workplace, with the following exceptions of:

• Health and Community Services employers were significantly more likely to report workplace productivity meant getting the work done/achieving the goals/purpose of the business.
• Education Services employers were significantly less likely to report workplace productivity meant working efficiently/effectively.
• Employers of workplaces with 100 or more employers were significantly more likely to report workplace productivity meant working efficiently/effectively.

Agreement with the Department's definition of improving workplace productivity

83% of employers surveyed agreed with the following definition of what improving productivity means.

The Department of Labour defines improving workplace productivity as creating a workplace that produces high value products and services through changes in workplace practices.

Of note, there were no significant differences in agreement with the Department's definition of improving workplace productivity by ANZSIC Grouping (with the exception of employers in the Health and Community Services Sector, who were significantly more likely to agree).

Those who disagreed generally had issues with the emphasis on 'high value products and services', as many reported dealing in 'low value, but high volume' activities. Other reasons included not viewing the making of changes to workplace practices to improve productivity as being in line with the goals or principles of the type of work their workplaces were involved in, such as health, education, sales or property and business services.

Staff related practices to improve productivity

Perceived impact of staff related practices

All employers surveyed were read a list of staff related practices and asked to identify those they thought would have a positive/very positive impact on productivity in their workplace. Between 67% and 97% of employers identified all of the practices as having either a positive or very positive impact:

• Increasing workers' skills through training (97% positive/very positive).
• Developing a workplace culture where people work together better (95%).
• Encouraging workers to be innovative (93%).
• Developing and training better managers (91%).
• Encouraging workers to use new technology (89%).
• Conducting team building activities (79%).
• Increasing workers pay rates (67%).

Variance by Industry

As might be expected, certain practices were more, or less likely to be seen as having a very positive impact in employers' workplaces, depending upon the Industry type:

• Manufacturing Services employers were significantly more likely to report encouraging workers to use new technology would have a very positive effect on workplace productivity in their workplaces. Conversely they were significantly more likely to report increasing workers pay rates would have no effect at all.
• Health and Community Services employers were significantly more likely to report increasing workers' pay rates would have a very positive effect.
• Education Services employers were significantly more likely to report the following staff related practices would have a very positive effect on workplace productivity in their workplaces:
• Developing a workplace culture where people work together better.
• Encouraging workers to be innovative.
• Increasing workers' skills through training.
• Increasing workers' pay rates.
• Wholesale Trade Services employers were significantly less likely to report increasing workers' skills through training or conducting team building activities would have a very positive effect.
• Hospitality/Accommodation/Travel Services employers were significantly more likely to report encouraging workers to use new technology would have no effect at all on workplace productivity in their workplaces.

Variance by size

As might be expected, certain practices were more, or less likely to be seen as having a very positive impact in employers' workplaces, depending upon the size of the workplace:

• Employers of between 5 and 10 employees were significantly less likely to report developing and training better managers would have a very positive effect on workplace productivity in their workplace.
• Employers of between 51 and 100 employees were significantly more likely to report developing and training better managers would have a very positive effect on workplace productivity.
• Employers of 100 or more employees were significantly more likely to report developing and training better managers and increasing workers' skills through training would have a very positive effect on workplace productivity in their workplace.

Implementation of staff related practices

All employers surveyed were asked which of the various staff related practices had been discussed and/or implemented in their workplace in the last twelve months.

On average, those surveyed reported that roughly five out of seven of the staff related practices had been implemented in their workplaces (i.e. a mean score of M=4.9), with the most frequently identified practices being:

• Increasing workers' skills through training (86%).
• Increasing worker's pay (81%).
• Encouraging workers to use new technology (74%).
• Developing a workplace culture where people work together better (73%).

Conversely, 33% of employers reported conducting team building activities and 33% reported developing and training better managers were practices that were neither discussed nor implemented in their workplace.

Variance by Industry

Depending upon the industry, certain practices were more or less likely to have been implemented:

• Health and Community Services employers were significantly more likely to report the following staff related practices had been implemented in their workplace:
• Developing and training better managers.
• Increasing workers' skills through training.
• Conducting team building activities.
• Education Services employers were significantly more likely to report the following staff related practices had been implemented in their workplace:
• Developing and training better managers.
• Encouraging workers to be innovative.
• Encouraging workers to use new technology.
• Increasing workers' skills through training.
• Conducting team building activities.
• Wholesale Trade Services employers were significantly less likely to report the following staff related practices had been implemented in their workplace:
• Encouraging workers to be innovative.
• Increasing workers' skills through training.
• Hospitality/Accommodation/Travel Services employers were significantly less likely to report the following staff related practices had been implemented in their workplace:
• Encouraging workers to use new technology.
• Increasing workers' skills through training.

Variance by size

Staff related practices more, or less likely to have been implemented, depending upon the size of the workplace, included:

• Employers of between 5 and 10 employees were significantly less likely to report developing and training better managers had been implemented in their workplace.
• Employers of between 21 and 50 employees were significantly more likely to report increasing workers' skills through training had been implemented in their workplace.
• Employers of between 51 and 100 employees were significantly more likely to report developing and training better managers and increasing workers' skills through training had been implemented in their workplace.
• Employers of 100 or more employees were significantly more likely to report the following staff related practices had been implemented in their workplace:
• Developing and training better managers.
• Developing a workplace culture where people work together better.
• Increasing workers' skills through training.

Business related practices to improve productivity

Perceived impact of business related practices

All employers surveyed were read a list of business related practices and asked to identify those they thought would have a positive/very positive impact on productivity in their workplace.

Between 62% and 77% of employers identified all of the practices as having either a positive or very positive impact on workplace productivity in their workplace:

• Reorganising the way work is done in the business (77% positive/very positive).
• Improving the physical surroundings of the workplace (76%).
• Sharing ideas with other businesses (75%).
• Measuring and tracking productivity indicators (74%).
• Purchasing machinery and equipment (72%).
• Improving health and safety practices (71%).
• Conducting research and development (62%).

Variance by Industry

Certain practices were more, or less likely to be seen as having a very positive impact in employers' workplaces, depending upon the Industry:

• Manufacturing Services employers were significantly more likely to report purchasing machinery or equipment would have a very positive effect on workplace productivity in their workplaces, and significantly less likely to report sharing ideas with other businesses have a very positive effect.
• Retail Trade employers were significantly more likely to report conducting research and development would have no effect at all on workplace productivity in their workplaces.
• Property and Business Services employers were significantly more likely to report purchasing machinery or equipment and improving health and safety practices would have no effect at all on workplace productivity in their workplaces.
• Health and Community Services employers were significantly more likely to report improving health and safety practices and sharing ideas with other businesses would have a very positive effect.
• Education Services employers were significantly more likely to report that the following business related practices would have a very positive effect on workplace productivity in their workplaces:
• Sharing ideas with other businesses.
• Improving the physical surroundings of the workplace.
• Conducting research and development.
• Wholesale Trade Services employers were significantly less likely to report that the following business related practices would have a very positive effect on workplace productivity in their workplaces:
• Purchasing machinery or equipment.
• Improving health and safety practices.
• Measuring and tracking productivity.
• Improving the physical surroundings of the workplace.
• Reorganising the work is done in the business.
• Hospitality/Accommodation/Travel Services employers were significantly more likely to report purchasing machinery or equipment would have no effect at all.
• Construction services employers were significantly less likely to report improving the physical surroundings of the workplace would have a very positive effect.
• Transport and Storage Services employers were significantly more likely to report purchasing machinery or equipment would have no effect at all.

Variance by size

Certain practices were more, or less likely to be seen as having no effect at all in employers' workplaces, depending upon the size of the workplace.

• Employers of between 11 and 20 employees were significantly less likely to report reorganising the way work is done in the business would have no effect at all on workplace productivity in their workplace.
• Employers of 100 or more employees were significantly less likely to report conducting research and development would have no effect at all.

Implementation of business related practices

All employers surveyed were asked which of the various business related practices had been discussed and/or implemented in their workplace in the last twelve months.

On average, the employers surveyed identified roughly four out of seven of the business related practices had been implemented in their workplaces (i.e. a mean score of M=4.3), with the most frequently implemented business related practices reported by employers being:

• Improving health and safety practices (73%).
• Purchasing machinery or equipment (73%).
• Reorganising the way work is done in the business (70%).

Variance by industry

Certain practices were more, or less likely to have been implemented, depending upon the Industry type.

• Retail Trade Services employers were significantly more likely to report improving the physical surroundings of the workplace had been implemented in their workplace.
• Property and Business Services employers were significantly less likely to report improving health and safety had been implemented in their workplace.
• Health and Community Services employers were significantly more likely to report sharing ideas with other business had been implemented in their workplace:
• Education Services employers were significantly more likely to report that the following business related practices had been implemented in their workplace:
• Purchasing machinery or equipment.
• Measuring and tracking productivity indicators.
• Sharing ideas with other businesses.
• Improving the physical surroundings of the workplace.
• Conducting research and development.
• Construction Services employers were significantly more likely to report improving health and safety practices had been implemented in their workplace, and significantly less likely to report conducting research and development had been implemented.

Variance by size

Certain business related practices were more, or less likely to have been implemented, depending upon the size of the workplace:

• Employers of between 5 and 10 employees were significantly less likely to report that the following business related practices had been implemented in their workplace:
• Improving health and safety practices.
• Measuring and tracking productivity indicators.
• Conducting research and development.
• Employers of between 51 and 100 employees were significantly more likely to report measuring and tracking productivity indicators and conducting research and development had been implemented in their workplace.
• Employers of 100 or more employees were significantly more likely to report improving the physical surroundings of the workplace had been implemented in their workplace.

Sources of information regarding improving workplace productivity

All employers surveyed were read a series of sources they might go to, if they wanted information about improving workplace productivity.

Most frequently, employers would go to a colleague or friend for information (86% likely/very likely), followed by trade and industry organisations (65% likely/very likely), whereas those organisations that employers would be least likely to go to were the Ministry of Economic Development, a trade union, New Zealand Trade and Enterprise or the Department of Labour.

Of note, more than half of the employers surveyed (54%) would likely/very likely use between three and five sources, if they wanted to find information on ways to improve workplace productivity, while approximately one third would use more than five sources (31%).

Variance by Industry

As might be expected, certain information sources are significantly more likely to be used by employers, depending upon their industry type:

• A trade or industry organisation, were more likely to be used by Hospitality Services and Retail Trade employers.
• A business mentor was more likely to be used by employers with workplaces having between 21 and 50 employees.
• Private consultants were more likely to be used by Education Services employers and employers with workplaces having 21 employees or more.
• Accountants were more likely to be used by Retail Trade and Construction Services employers.
• Lawyers were more likely to be used by Hospitality Services employers.
• A trade union was more likely to be used by Education Services and Health and Community Services employers.
• The Department of Labour was most likely to be used by Hospitality Services employers and Health and Community Services employers.
• New Zealand Trade and Enterprise was most likely to be used by Manufacturing Services employers.

Barriers to improving workplace productivity

All respondents surveyed were read a series of statements that 'some employers' have said 'put them off' from trying to improve workplace productivity, and asked for each statement how much they agree or disagree it applies to their own workplace.

Depending upon the statement between 69% and 84% disagreed that these things had put them off, as detailed below:

• Employees resist our efforts to improve productivity because they think it could affect their jobs (69% disagree/strongly disagree).
• Our competitors will get as much benefit from them as we do (69% disagree/strongly disagree).
• We are too busy to make changes (77% disagree/strongly disagree).
• It's risky to change the way we do things, and it might not pay off anyway (82% disagree/strongly disagree).
• It costs too much to improve productivity (84% disagree/strongly disagree).
• We wouldn't get any benefit for a long time (83% disagree/strongly disagree).

Other things that 'put-off' employers from improving productivity

When asked, if they could think of any other things that currently 'put them off' from trying to improve productivity in their workplace, more than half of all employers surveyed (56%) could think of no other things, while between 6% and 7% identified one or more of the following:

• It is too expensive/costs too much.
• Staff don't want to change, staff apathy/negative attitudes, resistance to change.
• Lack of time/takes too much time/timing issues.
• Lack of help from government/ laws/ legislation/ funding.
• Not having right staff/people to do it/hard to find the right staff.