Raconteur
The Wellbeing Research Centre of the University of Oxford conducted a study in 2019 that analysed data from 230 independent organisations across 49 industries. The findings suggest that employees’ satisfaction with their company strongly correlated with employee productivity.
Fortune
Additionally, hybrid work is the equivalent of an 8% salary increase in terms of employee satisfaction, as Bloom’s findings suggest. An Oxford-Saïd Business School and BT study takes this further, quantifying happiness and its impact on productivity among content workers: a 13% increase in performance.
Researchers have demonstrated a causal link between worker happiness and productivity in the first large-scale field study of its kind.
Their findings, published in the journal Management Science, serve as the clearest real-world evidence of wellbeing’s impact on worker performance to date.
The study of almost 1,800 BT call centre workers shows that a one-point increase in happiness (on a scale of 0 to 10) was was associated with a 12% increase in their productivity, as measured by weekly sales data.
Co-author Jan-Emmanuel De Neve, Director of the Wellbeing Research Centre at the University of Oxford and a Professor of Economics and Behavioural Science at the Saïd Business School, said:
“There is no question that caring for how employees feel at work is the right thing to do. Both the moral and business cases are now settled, especially given our most recent field research showing that employee wellbeing drives productivity as well as recruitment and retention of talent which, in turn, has measurable impact on a company’s overall financial performance.”
Researchers from Erasmus University Rotterdam, the University of Oxford, and MIT, observed workers from 11 UK call centres over six months in 2017 and 2018.
They used a well-established mechanism for measuring subjective wellbeing in the form of a weekly one-question survey emailed to workers, asking them to rate their happiness for the last week on a five-point scale1.
These scores were then anonymously mapped to workers’ individual performance for the same period, which showed a positive correlation between happiness and productivity. The results build on previous research showing mood effects in laboratory settings2, and demonstrate that happiness has an impact on productivity when it comes to workers, tasks, and jobs in the real world.
The effect of happiness differed across tasks. Simple ‘order taking’ calls were less impacted by a worker’s mood, whereas more complex tasks – like negotiating, selling bundles of products, and re-contracting – saw productivity increases closer to 20%, on average, per one-point improvement in happiness.
Co-author George Ward, a Research Fellow in Economics at the University of Oxford and recent graduate of the MIT Sloan School of Management, added:
“The findings suggest that the relationship between mood and productivity is not a always straightforward one, and can depend on the types of jobs people are doing. Mood seems to be a particularly strong driver of performance in tasks that require human interaction and where social and emotional skills play a large role in how productive someone is. These types of jobs make up a growing share of the economy, suggesting that the importance of worker happiness is likely to increase over time.”
The researchers went a step further to test the robustness of their findings, by using data on the amount of windows across the call centres combined with weather conditions – to use differential visual exposure to weather across workers as a form of natural experiment.
They were able to identify trends in mood that correlated with visual weather conditions – with workers reporting lower happiness on gloomy days, particularly in call centres with lots of windows where workers are visually exposed to the changeable patterns of British weather.3
Co-author Clément Bellet, an Assistant Professor at the Erasmus University Rotterdam, explained:
“We made an important contribution to the field by not only directly measuring employee happiness but also isolating the effect of weather exposure on mood using the diverse architecture of BT office buildings. This was a challenging task as past research on weather and mood often assumed the impact of visual exposure without measuring mood directly. By isolating these weather-induced mood shocks, we were able to gain deeper insights into the causal impact of mood on performance in a real-world setting.”
‘Does employee happiness have an impact on productivity?’ is published in Management Science.
This paper provides evidence from a natural experiment on the relationship between positive affect and productivity. We link highly detailed administrative data on the behaviors and performance of all telesales workers at a large telecommunications company with survey reports of employee happiness that we collected on a weekly basis. We use variation in worker mood arising from visual exposure to weather—the interaction between call center architecture and outdoor weather conditions—to provide a quasi-experimental test of the effect of happiness on productivity. We find evidence of a positive impact on sales performance, which is driven by changes in labor productivity—largely through workers converting more calls into sales and to a lesser extent by making more calls per hour and adhering more closely to their schedule. We find no evidence in our setting of effects on measures of high-frequency labor supply such as attendance and break-taking.
Economics, Erasmus University Rotterdam
Forbes
“‘Remember that this is your startup, and you should have fun while building it,’ he said. His view is consistent with a study conducted by Oxford University’s Saïd Business School, in collaboration with British multinational telecoms firm BT, which found that entrepreneurs who have a good time are more likely to be successful.”
Vox EU
Two years ago, Anna, a graduating PhD in Economics at the University of Stockholm, was considering jobs opportunities in Norway. She applied for a position in Oslo. Where did her first job interview take place? Not in Oslo, not online, and not even in Stockholm. The answer: in Rotterdam, The Netherlands. Anna was interviewed for a job at the University of Bergen, too. Strangely enough, she met the recruiting committee on the other side of the globe: in San Diego, California. Anna is a fictitious character, but her story has nothing implausible, and will be familiar to many graduating PhDs who lived similar experiences before the pandemic.
Financial Times
It is a bleak fact of 21st century life that the main stage of a business conference is where bold disagreements go to die. I speak as a serial offender, having been far too polite and seemly myself at such events, which have grown worse thanks to the stilted distance of virtual conferences.
So it was mildly shocking the other day to watch an online business panel discussion riddled with unflinching dissent.
Tellingly, the debate centred on a divide over worker autonomy that I suspect will widen as the trend for more flexible working gathers pace.
It happened at an FT conference, during a session on whether hybrid working between home and the office can really work…
This article provides quasi-experimental evidence on the relationship between employee happiness and productivity in the field. We study the universe of call center sales workers at British Telecom (BT), one of the United Kingdom’s largest private employers. We measure their happiness over a 6 month period using a novel weekly survey instrument, and link these reports with highly detailed administrative data on workplace behaviors and various measures of employee performance. Exploiting exogenous variation in employee happiness arising from weather shocks local to each of the 11 call centers, we document a strong causal effect of worker happiness on sales. This is driven by employees working more effectively on the intensive margin by making more calls per hour, adhering more closely to their workflow schedule, and converting more calls into sales when they are happier. In our restrictive setting, we find no effects on the extensive margin of happiness on various measures of high-frequency labor supply such as attendance and break-taking.
19 March 2020
New Straits Times
Research suggests that there are several reasons that people can and should choose to be happy, even when it is a difficult choice. A 2019 study conducted by Professor Jan-Emmanuel De Neve from Saïd, George Ward from MIT and Clement Bellet of Erasmus University Rotterdam has found that happy workers are 13 percent more productive.