One of the main factors for suboptimal GDP-growth in Singapore

Singapore is small by many standards.

Certainly very small in terms of population. We only have 5.6 million residents. Roughly a quarter of municipal Shanghai or less than 0.1% (0.073% in fact) of the global population. A mighty punching-above-their weight bunch of smart and hard-working people.

How is our (and every other country’s) GDP growth being determined?

Basically there are two factors:

1)     Working population growth – well, we all know how unproductive Singaporeans are in terms of “doing the deed” and producing more babies.

Less babies can either be compensated with foreign talents joining the workforce or a change in the participation rate (people who have not worked re-joining the workforce – see exhibit 1). Both are happening.

Labour Force Participation Rate is mysteriously not available for the age-group 70+ in 2018. It was 28% for 70-74 and 9.1% for 75+ in 2017. 2018 might be even higher following the previous years’ trend.

2)     Output per unit of labour input – or simply put labour productivity.

A KPI where we do not see the steady up-trending chart as we would wish for resulting in a labour productivity growth of less than 1% from 2007 to 2017 (see exhibit 2).

The labour-intensive industry sectors Transportation & Storage, Accommodation & Food Services, and Business Services have even a negative productivity growth and not seen the productivity levels of 2007 (pre-financial crisis) yet (see exhibit 3).

Now here are my premises for my thesis:

1)     For any employee leaving an existing job and joining a new organization their labour productivity drops.

Even if he/she continues to work in the same job. Simply by not knowing that new corporate culture, the specific procedures, colleagues, and the lack of network.

Let’s say Employee A in company A has a productivity of 100. But Employee A in company B would drop to something like 70-80 and has to slowly improve back to the 100 over the next few months or years. In addition he/she left a productivity gap in company A that has to be filled – after a time gap – most probably with someone delivering only 70-80 instead of 100.

2)     Singapore has the lowest employee engagement rating in Asia – for a while already. (see exhibit 4 “AON Employee Engagement Score”)

3)     Singapore has very high attrition rates. Overall about 22% p.a. vs 12% in SEA vs 10% globally considered healthy. Especially high in those labour intensive industry sectors Accommodation & Food Services, as well as Admin and Support Services where they can reach as much as 40 to 50% a year (see exhibits 5 and 6 “MoM Stats”).

4)     There is ample research and studies out there that prove that low employee engagement leads to higher attrition rates. And higher employee engagement leads to lower attrition rates. That’s causation and not just correlation!

Employee Engagement Investment Pays For Itself

So my theory is that focusing attention and investments on boosting employee engagement (the leading indicator of business performance) at work will always pay for itself multiple times over by impacting the following operational and financial KPIs:

1)     Better Customer Service (an engaged and proficient employee will provide better customer experiences).

2)     Higher Customer Satisfaction will lead to higher customer loyalty and revenue growth.

3)     Higher Retention (an engaged employee will simply stay longer – enough said on that one).

4)     Higher Productivity (that 100 vs that 70-80).

5)     Lower costs in hiring, selecting, onboarding replacements (in Singapore it costs companies in average 12,500 SGD for each unwarranted staff replacement – feel free to contact me for details on the computation of that number).

Loyal employees are worth much more than their weight in gold.

6)     Higher profitability which will create more room to future-proof the business.

NOW WE ARE GOING BEYOND THE COMPANY NUCLEUS

7)     Higher GDP growth in Singapore through steadier labour productivity gains.

8)     Higher GDP growth through more babies in Singapore.

Hold on, that might appear like a bit of a long shot.

Bear with me for a while.

Well, isn’t it all about probabilities?

More opportunities means a higher chance of success (and more fun along the way).

But if you and/or your spouse are stressed out at the job or just disengaged, do you think you are in the mood for the deed?

On-the-job stress spills over into marital relationships and negatively affects both individuals. In fact, mental job stress has a greater impact than physical exhaustion on marital interactions.

Because of the psychological notions of spillover and crossover, our feelings at work impact our behaviours outside of work, thereby impacting our loved ones.

Want a better marriage? Become fully engaged at work.

That same concept of correlations also means that “Working for a bad boss may be as harmful to your heart as smoking.”

And for the leaders among you, remember, you aren’t a marriage counselor, yet you influence your team members’ relationships with their spouses.

Sometimes in life it is so simple. But not easy!!

9)     And yes, less work for those headhunters who simply lure people out of existing jobs by promising them “greener pastures”. (“Oops, the new job did not work out. No problem, just churn them once more”). I call them parasites to the society as they are not adding value but contributing to a slower GDP growth by rotating people from a productivity 100-job to a productivity 70-to-80-job. (Ouch, this might not have gotten me new friends on LinkedIn from the headhunter fraternity. Never mind, the truth is worth it).

Looking at all those benefits what is there not to like about highly engaged employees at work?

Employee Engagement is that one factor for sub-optimal GDP-Growth.

And higher employee engagement can be achieved with tested and readily available tools in the hands of leaders with the right focus and attitude.

Magic. That’s what a good friend of mine would call a “Know-Brainer”.

Then why do I still see so few or half-hearted efforts to boost employee engagement in Singaporean organizations?

I am puzzled.

Would be grateful for anybody to share some reasons why there is such a lack of adoption of proven employee engagement systems and tools here in Singapore.