Workers ‘waste $109bn’

Mark Hawthorne (SMH)

October 17, 2011

AUSTRALIAN workers are among the hardest-working in the developed world, notching an average 44-hour week, but they also rank among the least productive, amassing $109 billion of wasted wages each year.

A third of Australian employees plan to quit in the next year, more than half say poor management has the biggest impact on their productivity, and 18 per cent of the average working day is spent on “work that wasted time and effort”. They are among the key findings of a comprehensive study of almost 2500 Australian workers and their bosses, conducted by accounting firm Ernst & Young.

“What we found is a highly motivated Australian workforce,” said Ernst & Young partner Neil Plumridge, who led the survey team.

“We are not a nation of slackers.”

We worked harder than other developed countries in terms of labour hours, and were highly motivated to work, he said. More than 70 per cent of us came to work every day with the best of intentions, which was something to be proud of.

“The problem is the productivity of our workforce,” he said. “The hours are good and the intentions are good, but we found an incredible wastage once we all get to work.”

The total wages bill for Australian workers is estimated at $606 billion a year.

“Given that 18 per cent of our time at work is wasteful, ineffective and not valued, that’s $109 billion waste in annual wages,” Mr Plumridge said. “Even if we can get a 10 per cent improvement, that’s worth more than $10 billion a year to the national economy.”

The inaugural Australian Productivity Pulse survey found that management issues (54 per cent), organisation structure (23 per cent), a lack of innovation (15 per cent) and outdated technology (8 per cent) were cited by employees as the drains on productivity. According to Mr Plumridge, productivity in Australia has been on a 10-year decline. That view is supported by Graham Bradley, the departing chief of the Business Council of Australia, who last week said the nation had endured decades of “mediocre growth and declining opportunity” because of a productivity slump.

In a speech in Sydney, Mr Bradley called on employers and workers to “strike adult agreements with each other to embrace technology, improve productivity and share the benefits”.

Despite the backdrop of slumping productivity, Australians are generally happy at work, with 68 per cent saying they were “proud to work for their employer” and 68 per cent believing their work was valued.

The survey found that older workers were more motivated to perform – and less interested in pay – than their younger counterparts. More than a quarter of workers aged under 20 listed salary as the top motivator for going to work, and salary topped the list for workers up until the age of 35.

In contrast, less than 10 per cent of workers aged 45 and over cited pay as their key motivator for working. “One of our key findings is that older workers are much more motivated by the satisfaction of simply doing a good job,” Mr Plumridge said.

The report found that 32 per cent of Australian workers planned to leave their employer in the next 12 months. The figure was highest in the retail sector, where 44 per cent planned to quit inside a year, and lowest in the public sector, at 27 per cent.

Full article: http://www.smh.com.au/business/workers-waste-109bn-20111016-1lrfx.html#ixzz1b0670E6o

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About The Author

Marco Tapia

Managing Director, PicNet Pty Ltd. Marco has 30 years experience as Company Director, CIO, Business Technology Consultant and IT Project Manager, managing large and medium size IT functions for national and international corporations. He holds an MBA from the University of NSW, a BSc (Electronics), a Diploma in Systems Analysis and is a member of the Australian Institute of Company Directors.

About Marco Tapia

Managing Director, PicNet Pty Ltd. Marco has 30 years experience as Company Director, CIO, Business Technology Consultant and IT Project Manager, managing large and medium size IT functions for national and international corporations. He holds an MBA from the University of NSW, a BSc (Electronics), a Diploma in Systems Analysis and is a member of the Australian Institute of Company Directors.

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