Are happy employees more productive?

Last updated: 2022-04-215 min read time
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Happy employees - there’s simply nothing more important to your business.

A blog post called Happiness at Work refers to a study conducted by Robertson Cooper Limited of approximately 3,200 employees, which found the following:

  • Employees who felt good at work and had better working days scored high on positive emotions and low on emotions such as loneliness, hopelessness, depression, and insecurity
  • The percentage of employees who had high scores of positive emotions were healthier, more productive, and more satisfied with their jobs
  • Employees who showed traits of depression, stress, and emotional vulnerabilities were less motivated, unwilling to improve their skills, and showed signs of unhealthy interpersonal connections at work

With higher productivity, profitability and engagement, what organization wouldn’t want happy employees?

What It Means to Be Happy at Work

A Forbes article called Promoting Employee Happiness Benefits Everyone cites author Patrick Lencioni who defines happiness at work as: “wanting to feel like who you are matters (you want people to know your name), that what you do has an impact (that you're engaged in relevant work) and you're making progress (that your work is having an impact and leading you and your organization forward).”

Feeling happy at the workplace is something we all should strive to achieve since work plays a crucial role in our overall happiness and wellbeing.


Five Ways Happy Employees are Good for Business

1. Happiness Is Contagious

As humans, we’re all affected by our environment and by each other. NJ Life Hacks shares the results of Harvard researchers who measured how the happiness of siblings, friends, neighbors, and social networks affect one another. They found that:

  • If a friend who lives within half a mile of you gets happy, your chances of happiness increase by 42%.
  • If that happy friend lives a mile away from you, your chances of happiness increase “only” by 25%.
  • Siblings who live close to a happy sibling increase their chances of happiness by 14%.

Just imagine the ripple effect of what a couple of employees who are happy, engaged, positive, confident, and motivated could have on your workplace.

2. More Productive

As author and speaker Shawn Achor writes: “It turns out that our brains are literally hardwired to perform at their best not when they are negative or even neutral, but when they are positive.

Therefore, it should come as no surprise that happy and engaged employees are more productive. Gallup research shows that highly engaged business units are 17% more productive.

3. Higher Retention Rates

It’s simple. If an employee is happy and engaged in their work, feels connected to and invested in the company, has opportunities for growth and development and is compensated well, there’s no reason to go elsewhere.

Gallup research finds that in high-turnover organizations, highly engaged business units see 24% less turnover and low-turnover organizations see an incredible 59% less turnover.

4. Higher Profitability

As stated above, happy and engaged employees are more productive. Therefore, it should come as no surprise that Gallup research finds that highly engaged business units result in 21% greater profitability.

5. Fewer Sick Days

Happy employees don’t experience Sunday Night Dread because they like what they do, they enjoy the social interactions, they enjoy creating value and enjoy being part of the company’s success.

As a result, happy employees take fewer sick days. Gallup research shows a 41% reduction in absenteeism.

When it comes to happiness, today’s youngest generations seek more than “just a job”. In addition to using their strengths, being aligned with the company values and feeling that what they do matters, today’s youngest employees also seek flexibility and work-life balance. After all, while meaningful work contributes to our happiness, so does everything we do outside of work.

Therefore, one of the best ways that employers can demonstrate their support for employee work-life balance is through their employee benefits offering.

Want to learn more about the connection between happiness and employee benefits? Download our free Employee Happiness Index 2019 e-book today!