Companies appear to intuitively know that work/life balance is important. For instance 93% believe there is some connection between the wellbeing of their staff and the performance of their business and 58% saying they are very closely linked. However the study puts a clear value on it.
Morgan Redwood’s study shows average net annual earnings per employee of £26,557 but this figure rises to £32,769 in companies which take care to ensure staff have a good work/life balance. This is because such a balance reduces absenteeism, improves wellbeing and increases productivity. This is an important insight given that improving productivity and performance is the top HR priority according to the companies studied.
Janice Haddon, Managing Director of Morgan Redwood comments: “We all instinctively know that a good work/life balance matters – but to have the actual value of it quantified is a breakthrough moment. It means that when weighing up different management options, companies have some real numbers to factor into their decision making. This means that a change that perhaps will save money in the short term, but put additional workload onto staff, can be properly assessed.”
The research suggests work/life balance is already severely under threat as companies call on their remaining staff to pick up the additional workload created by redundancies. For instance, 47% of UK businesses questioned have seen their headcount drop over the last 12 months and while the majority say the position has now stabilised for one in six, further reductions will follow in the coming year with the largest companies three times more likely than smaller businesses to reduce their employee levels over the next 12 months.
Janice Haddon comments again: “As companies look to make these critical savings, they must take care to not lose sight of the commercial knock-on effect of their actions. Work/life balance is not a ‘nice to have’ when we’re in a boom time. It can have a fundamental impact on the corporate performance at all times. Companies who focus on and measure staff wellbeing are in fact being very prudent. They’re making as big a contribution to their bottom line as those who are looking at ways to increase sales or cut costs.”
While the research quantifies the value of work/life balance, it also shows that it is not a business ‘cure all’. For instance only 18% say work/life balance affects staff morale – and at the moment staff morale is scoring just over 6 out of 10 – a relatively low figure. According to the business leaders questioned, morale is more impacted by the wider economic downturn (82%), job security (53%) and pay (51%) and a lack of investment in staff (30%).
Janice concludes: “Training and development could be brought to bear quite neatly in the current climate. Development would portray a business as investing in its people and it would counter the problem of stalling salaries. What’s more it could be focused on helping staff achieve a better work / life balance which we know can help increase net average annual earnings per employee by 20%. Not only that, if companies place a focus on showing staff how to get out of self limiting beliefs and concentrate on personal positivity, they will be supporting staff with additional tools in how to personally deal with the impact of the wider economic downturn.”