The world of work is changing, both the structure of the labour market and the types of work we do. Employees are the 21st century organisation’s greatest asset - accountants are even adding human capital to the balance sheet.
The big picture
The structure of the labour market in the UK has changed dramatically over the last few years and will continue to change:
- We remain in full- or part-time education until we are older, while more of us are opting to retire at an earlier age.
- The largest growth in labour market participation between 1990 and 2000 occurred among mothers with young children.
- It is projected that 66% of the increase in the UK population between 2000 and 2025 will be attributable to immigration.
- Generation Y (those born after 1978) has entered the workforce: these young workers look at an organisation’s track record on corporate social responsibility and are not afraid to negotiate flexible working terms.
The types of work we do and the nature of work itself have also changed dramatically over the past 20 years:
- Over 22.5 million people in the UK are employed in the service sector and just 4.6 million in manufacturing. (ONS, 2008).
- The intensity of work has increased: average working hours are shorter, but work is carried out faster. Intensification affects all countries in the EU, all industry sectors and all occupational categories.
- Changes in technology (IT and telephony) give employers more flexibility in terms of how they ask people to work. 80% of managers said that virtual working (also called e-working) is a key business issue (Roffey Park, 2003).
Good work-life balance policies and practices help meet these changes and are good for business as well as employees. Some benefits can be directly measured financially.
The business benefits of work-life balance
Increased productivity, mediated through the factors listed below, as well as:
- The degree of control an employee has over their tasks impacts their effectiveness at work.
- A 2003 DTI study revealed that 49% of companies saw a positive increase in productivity (DTI, 2003).
Improved recruitment and retention:
- Labour turnover is expensive, both in terms of direct replacement costs and the loss of skills and knowledge.
- A DTI poll found all workers were interested in good work-life balance policies, but they are particularly important to carers, parents (mothers and fathers), graduates and older workers.
- BT saved £3 million in recruitment costs in the year to March 2003 because 98% of women returned after maternity leave. Read this case study
Lower rates of absenteeism:
- The CBI believes that absenteeism levels are the main reason why UK productivity lags behind the US and some parts of Europe, costing the UK £11.6 billion per year.
- Good work-life balance policies take account of long-term absence, the causes of stress and the needs of different groups. See our work on Health and Wellbeing
- The London Borough of Camden experienced a 2.5% reduction in the cost of sickness absence in the first year it introduced a work-life balance strategy. Read this case study
Reduced overheads:
- BT saved £52 million in overheads in the year to March 2003 by increasing its number of home workers; this also means an annual saving of £10 million in fuel costs.
- An improved customer experience.
- A more motivated, satisfied and equitable workforce.
To find the right work-life balance strategy for your business you will need to identify what your business wants to achieve from it, eg more women in senior positions or greater workforce diversity.