Why are happy employees more productive?

Employers might wonder, are happy employees more productive? There is a direct correlation between employee happiness and productivity, indicating that happy employees are more productive in the workplace. A study from Oxford University’s Saïd Business School found that happy workers are 13% more productive than those who are dissatisfied with their jobs. This study’s results of tracking employee habits indicate that happier employees do not put in more hours than their unhappy counterparts. Contented workers are simply more effective at their jobs within their designated working hours.

Here are a few reasons why happier employees create a better work environment and deliver high-level results for your business:

They feel more empowered to make decisions

Happy employees don’t feel micromanaged or controlled by their employer. Instead, they feel prepared for their responsibilities and trusted to make the right choices. When employees can make decisions without consulting multiple levels of management or enduring lengthy approval processes, they’re able to move more quickly.

They’re more enthusiastic about their work

Satisfied employees are more motivated to complete their work on time and committed to maintaining a high level of quality. Because they find joy in their jobs, they’re also more determined to make a good impression and stay with the company long-term. Additionally, because satisfied employees are also less stressed, they’re less likely to feel burnt out or disengaged — both of which are factors in decreased productivity.

They facilitate better workplace communication

When employees feel comfortable and confident in their workplace, they are more likely to forge better working relationships with their colleagues. An employee who has good relationships with their coworkers and frequently communicates with them can operate more efficiently because they don’t hesitate to ask questions or share information that may help others succeed.

They provide a better customer experience

When an employee is happy, they’re more likely to come to work with a positive and professional attitude. This is especially crucial for public-facing employees who regularly engage with current and potential customers. When an employee is well-trained and genuinely happy, they’ll consistently provide better service.

They are more creative

Creativity is proven to make you happier, but being happy can also promote creativity. This positive cycle stems from a happy mood and free mind being more receptive to new ideas and alternative ways of thinking. When employees are happy at work, they are more likely to contribute more innovative and creative ideas to team projects and discussions, ultimately boosting productivity. Happier employees can also be better problem solvers for this same reason.

How to improve employee happiness

Here are seven ways you can boost employee satisfaction in your organization:

1. Compensate employees fairly
   An essential way to show employees you value them and enhance their level of happiness is by paying them an amount that reflects their skills and experience. Always consider average salaries for each position and strive to stay competitive. Additionally, when employees grow their skills and take on additional responsibilities, increase their pay to reflect their added value.
2. Recognize employee contributions
   One of the most important factors in employee satisfaction is consistent recognition. By taking the time to let employees know when they’re exceeding your expectations and performing well, they’ll feel more confident in their abilities and be more likely to continue their positive habits.
3. Give employees the tools to succeed
   Providing reliable technology, a comfortable work environment, comprehensive training and opportunities for career development will prepare your workforce for success. Ensure your employees have up-to-date software and access to the technical support they need to resolve problems quickly when they occur. This helps reduce instances of wasted time and stress. When employees have the right tools, they’re less likely to become frustrated, unsure or uncomfortable and more likely to feel satisfied and supported.
4. Reward your top performers
   When an employee does more than expected, such as delivering an important project well before its deadline, earning an exceptionally positive customer review or exceeding their sales quota, be sure to reward them. A reward can be monetary, such as a bonus, or non-monetary, such as a reserved parking spot or extra vacation time. Incentives such as a Health & Wellness Contribution (Sweden), Choose Your Own Device programs (Denmark) and Flexible Compensation (Singapore) are some of the perks offered around the world to employees outside of their salary that improves their job satisfaction.
5. Promote a healthy work-life balance
   Employees have a life outside the workplace, and you recognize this as an employer. You can help your staff find a healthy balance that improves their productivity in the workplace. A work-life balance means employees have harmony between these various aspects of their lives; they don’t feel like you are asking them to sacrifice elements of their personal life to succeed at work.

   One survey found that employees who feel like they have a good work-life balance were likely to work 21% harder than those who did not have this balance. Support work-life balance for your employees by offering flexible working hours, remote work opportunities and paid time off (PTO) that enables your team to have a fulfilling life outside of the office.

6. Provide constructive feedback
   If an employee isn’t sure whether they’re doing well, they’re more likely to feel doubtful about their performance — which can lead to stress and dissatisfaction. To prevent this, set up a process for consistent feedback. Ensure all managers regularly meet with their direct reports to discuss performance and provide constructive and helpful advice for improvement.
7. Create a friendly, communicative company culture
   It’s essential employees feel safe, supported and valued in the workplace to be happy. Take time to assess your company culture and look for areas of opportunity. It’s critical you eliminate any instances of bullying or discrimination and foster feedback and open communication between employees and leadership.

Building a happy workforce takes time and effort, and you can’t expect employees’ attitudes to shift overnight. However, by committing to the activities listed above, you can ensure your organization is thriving and powered by productive, happy employees.

Frequently asked questions about workplace happiness and productivity

These are some of the most commonly asked questions regarding how employee happiness impacts a company’s productivity.

Are companies with happier employees more successful?

There is overwhelming evidence that a company culture that prioritizes employee happiness results in more successful outcomes for your business. Employees who are satisfied at work and feel valued are greater assets to your company. Higher rates of employee happiness result in better employee retention, lower rates of absenteeism and increased productivity.

How can I measure employee happiness?

There are several ways for you as an employer to actively measure your staff’s happiness and satisfaction. One popular method is to release an anonymous employee satisfaction survey on a platform like Google Forms to allow staff to provide feedback on their satisfaction without fear of repercussions. You can also have annual or quarterly one-on-one meetings with your team members where you ask them for feedback and note any suggestions they have to improve company policies or practices. Other indicators of employee happiness can be performance, workplace relationships and attendance record.