In light of the new unemployment figures released by the ONS today, there is an inherent flaw in measuring employment a rise in employment against the health of the economy.
Roger Philby, the CEO of The Chemistry Group had this to say: “An interesting conundrum in today's employment figures, summed up neatly by John Philpott, director of The Jobs Economist, who stated: “We are in a middle of both a jobs boom and a pay slump as jobseekers struggle to gain or retain employment in a stagnant economy by pricing themselves into work, with the economy using more and more people at falling real rates of pay to produce a static level of output”. So as the government will no doubt celebrate their job creation policy, the ONS has said the UK economy is still in decline or flat. The measure of the number of people in jobs shouldn't be, and never was, the measure of economic prosperity. The banking boom was not about 100 percent employment or overly engaged staff it was about a rising tide, “even turkeys fly in a hurricane”.
We saw this in the mobile telecommunications boom that led to the unrelenting growth of the big mobile players; did these companies thrive because their employees were better or more engaged than another? The truth is they thrived in spite of whether their people turned up and were productive. As the market changed and the tide went out, the leadership and culture of these organisations were exposed as flawed, shallow and the people not truly engaged. The hiring processes was inaccurate and not fit for purpose and development processes an exercise in box ticking. What we find in the employment numbers is nothing has changed. Yes, more people are being employed and no, these people are no more productive than the people they join or who preceded them.
The question is whose fault is that? It's not government, it's not even HR…it's the CEO's of these firms. We would argue that if organisations hired, developed and nurtured the right people for their organisations in a systematic and objective way they would thrive, productivity would increase. Smaller yes, more effective, definitely. In order for our economy to increase in productivity, we believe organisations need to shrink, less of the right people, not more of the wrong. You need to intelligently contract before intelligently expanding. Our data suggests that organisations currently have 25 percent of the right people in their organisation, in order to shift economic productivity, 75 percent of an organisation’s workforce needs to change. If organisations are currently flatlining with 25 percent of the right people, it would only require an extra 25 percent of the right people for them to thrive.
Fifty percent less people then would create an organisation that was 50 percent more productive. It's logical, if I had double the amount of people behaving and performing like my top 25 percent then usually I would get double the performance, surely? The way the economy views employment data is flawed. Chemistry has a model that looks at how organisations hire, develop and energise their people to give a better view of the productivity of that company vs. the productivity opportunity available. We know today most organisations are exploiting 25 percent of their opportunity. Adding more of the wrong people doesn't change this. Our view of what's happening is a complete lack of joy…seriously declining productivity which is what the numbers suggest is directly linked by the moments of joy I have in my work. Some call it “flow”, Maslow described it as “self-actualisation“, consultants call it “engagement. We call it people bringing their whole-selves to work.
