Blog: Flexible Working - productive vs reductive debate?

27st January 2025

by Lynn Houmdi

Lynn Houmdi is founder of Flexible Working Scotland, Co-creator of Making Work Work and Senior Manager, The Challenges Group. She supports people - particularly women - to find or create meaningful work that works with all the other commitments and enjoyment of life. Prior to this Lynn had a career in public policy and diplomacy.

---

Last week we witnessed another wave of media attention on flexible working, prompted largely by the BBC Panorama episode which aired on 20 January, “Should we still be working from home?”

In recent months, we have seen a surge of RTO (return to office) mandates, calling employees back into the office for all or part of the week and reversing policies put in place during the pandemic.

In the media, the flexible working debate is often over-simplified as a binary: in the office or working from home. In fact, there are literally hundreds of flexible working patterns, because every variant could be combined with one or more others. For example, someone might work part-time, hybrid. Another employee might have flexible start and finish times to their day while working remotely.

Evidence based decisions?

There is a body of research emerging which suggests that decisions around RTO are not being taken on the basis of evidence around productivity but on personal bias (by older, male CEOs);[1] on the basis of sector trends (everyone else is, so we had better); to reassert control over employees, blaming them for bad firm performance;[2] or as a means to reduce headcount without redundancies.[3] Research published in November 2024 by recruitment platform Indeed found that 44% of managers and 55% of employees felt RTO was less about purpose and more about keeping up appearances.[4]

In assessing whether a particular form of flexible working is good for productivity, firms need to first be able to measure productivity. In some industries, this is simple - number of calls answered or number of lines coded. In many others, it is much more complex.

Productivity may be improved by the time or location of work. While someone may feel productive ploughing through emails at home, are they also productive in the office catching up with colleagues? On the other hand, too much time at home may lead to isolation, impacting productivity and belonging in the longer term. How do we measure this?

It is also necessary to understand the fundamental role of two important - and interrelated - elements of productivity: good managerial practice (including performance management) and trust. According to the Chartered Management Institute, over 80% of managers are so-called accidental managers, meaning they took on managerial responsibilities without formal training. Someone who is ill-equipped to manage people they can see from their desk is unlikely to be able to manage well when team members are working flexibly.

Trust is vital.

Only a good manager can engender trust. Trust is vital in employee engagement, retention, productivity and wellbeing. The most efficient scenario is one where an employer does not take on people who are not trustworthy, manages performance supportively and well, and does not act in a way which undermines trust. However, life is not only more complex than tabloids suggest, businesses do not always operate efficiently.

Despite an apparent dislike of remote working among some prominent senior leaders, it is enabling a greater supply of labour, as more disabled workers, women and parents access work. It is a magnet for talent, meaning firms can recruit sought-after skills from a much wider radius. It is also driving technological advances and investment.

Nick Bloom, the Stanford Professor featured in the Panorama programme wrote in a paper for the IMF that the impact of remote working depends on how it is managed. He goes on to say:

“While the micro productivity impacts on any individual firm may be neutral, the huge power of labour market inclusion means that the aggregate macro impact is likely to be positive.”

And while he acknowledges the negative impact on city centre retail and commercial property prices, retail spend is being displaced to suburbs and commercial property has the potential to be repurposed for housing.[1] 

In that frustrating way that real life is often more complex than tabloid headlines would suggest, one size does not fit all. Not only for individuals, but for businesses. As managers and leaders, we need to move away from fluffy phrases such as “flexible working” towards honest, evidence-based discussions of how, where and when people deliver their best work.

Happy workers are productive workers.

If we accept that diversity is good for business, then a greater diversity of working patterns is good for individuals, for businesses and for the economy, because diverse workforces are not built on the assumption that everyone delivers their best work in the same way.

The reductionist debate of remote vs. the office is unhelpful, not least in erasing the experience of many front-line and customer-facing employees and key workers who wish they had the choice.

Ends

References

[1] https://www.linkedin.com/posts/nick-bloom-stanford_three-papers-analyzed-1200-us-return-to-activity-7250871032759099392-qYVI

[2] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4675401

[3] https://www.linkedin.com/posts/nick-bloom-stanford_employees-appear-to-be-pushing-back-more-activity-7272263800437764097-ocrj

[4] https://www.personneltoday.com/hr/return-to-office-appearance/

Image credit: sharing thumbnail image by Adolfo Félix free from Unsplash 27.1.25

Blog: Scotland needs economic hope

27th November 2024

by David Gow, DHI Trustee

"Fings can only get worse," warned PM Keir Starmer in a negative take on the 1993 D:Ream anthem that ushered in the last Labour government and the Northern Ireland band has now banned the party from using. It's one message from the Prime Minister the public fully believes in five months after Labour's landslide win.

Our latest Understanding Scotland Economy Tracker, the 13th 'wave' in the series, highlights a deepening pessimism among Scots, young and old, about their own and the country's prospects. Almost two-thirds (63%, up 9% on the August survey) believe the economy has worsened in the past year and 65% (up 13 points) expect a further deterioration. At a personal level, the sense of doom is slightly less dark: at 48%/44%. But don't hold your breath.

It's pretty plain that Scots, like most Brits, know and feel that the UK is measurably poorer now than it was, say, pre-pandemic or pre-Brexit or pre-great financial crisis even over a decade ago. The last parliament (2019-24) saw the worst decline in earnings growth for over 60 years and the "boomers'" children are worse off than their parents. Too many of these are now attracted to the Far Right - across Europe and elsewhere.

Sebastian Burnside, NatWest chief economist, told me at the tracker's launch (25 November) that he didn't expect a new recession but with Donald Trump already slapping prospective tariff hikes on Canada, Mexico and China it must be nip and tuck. A generalised tit-for-tat trade war will almost certainly deepen any recessionary tendencies, notably in the eurozone, with the ghost of Smoot Hawley 2.0 worrying the hell out of policymakers and observers. (Or it should be!)

Skipped meals and depression

Almost a half (47%) of younger Scots, according to our survey, say economic anxieties and pressures are affecting their mental health - a finding true of a third (32%) of Scots as a whole. Three in ten of us are losing sleep over our finances. People are cutting back on buying fresh food products and skipping meals (as many as 19%) and this is more true of young people than other demographic groups.

For me and others the greatest worry is the impact upon young children. Danny Dorling, Professor of Geography at Oxford University and a surprise guest at the launch, commented the worst affected in terms of the rise in child poverty in the Europe is England, he shocked us. No English county outperforms Scotland in this regard. In terms of economic pessimism, suggested this was a global trend - with some notable exceptions in countries such as India... and Russia - for other reasons.

This, of course, is no consolation. Around a quarter of a million of Scottish children (26%) live in relative poverty and the Scottish Government is way off reaching its 10% target by 2030-31, even with the Child Payment. We all need hope but our young people, above all children, need an injection of this most of all if we are to begin to tackle the enduring UK/Scottish problem of low productivity growth which, as Burnside said, is the biggest source of declining living standards.

Investing in the future

Rachel Reeves, the UK chancellor, is struggling to inject hope and optimism into business and consumers for all her talk of investment and growth. Our tracker, equally, sets a high bar for Shona Robison, finance secretary, to cross when she presents the Scottish Budget on December 4. Even the unexpected boost to the Scottish Government's net fiscal position from the first Reeves budget - "transformed" according to the IFS - may not be enough.

Robison, cannot promise the earth but she could and should offer the prospects of a (eventually) more stable outlook and put the emphasis on investment in education and training as well as in the most promising economic sectors, including the (struggling) creative industry. Our tracker points to an urgent need, above all, to restore public confidence in the future.

"Get Scotland Working" is likely to be a theme (h/t the UK version unveiled on November 26) for her to adopt. Not in terms of unemployment but incentives to enter or re-enter the labour market, notably among the more than 300,000 Scots on adult disability payment and those economically inactive as a whole (22.6% of the 16-64 age group) of which there are a staggering 9m in the UK.

However, for many work is not a route out of poverty or cutting the welfare bill, with around four in ten of those on Universal Credit in Scotland, being in work. Low paid and precarious work traps many in a constant battle to make ends meet - this certainly won’t help boost productivity with so many people losing sleep over their finances.

Collectively, Scottish politicians and civil society need to turn around what is one of the most arresting tracker findings: a net 64% of our citizens believe the economy works in the interests of the wealthy while a net -56% think it does not work for them individually.

• The survey of 2,233 respondents was designed by the DHI and Diffley Partnership, carried out 1-5 November 2024

Image credit: sharing thumbnail image by Jon Tyson free licence from Unsplash on 27.11.2024

Press Release: Scots report increased financial pressure impacting their work and home life

48% of people living in Scotland believe their financial situation is worse than a year ago, our independent quarterly tracker has revealed.   

Since August 2024, there has been a six percentage point rise in people feeling that their own finances have worsened in the last year – with 3 in 10 people (29%) admitting they have lost sleep over money.

While 63% believe that the general economic conditions are worse, up nine percentage points, 65% of people said they believe that the general economic conditions will continue to decline, up 13 points on the last quarter.  

The latest results for the Understanding Scotland Economy Tracker, from the David Hume Institute and polling experts Diffley Partnership, suggest a growing lack of optimism over the last three months and pose big questions for Shona Robison ahead of the Scottish Budget.

The latest edition of the survey from November 2024 shows that:

• More than 1 in 6 people (17%) report strained relationships at home because of money

• 1 in 6 Scots (16%) report an impact on their physical health due to worries about money

• 1 in 3 people (32%) report an impact on their mental health due to worries about money

• Only 15%  say that concerns about money matters have not affected them

• 3 out of 4 people (75%) believe the economy works primarily in the interests of wealthy people

This shift towards a less positive outlook suggests that political messaging from Prime Minister Keir Starmer that “things will get worse before they get better” ahead of Labour’s first budget in October has been heard loud and clear by Scots.

However, there is not a complete lack of optimism with younger Scots more likely to believe that their financial fortunes will turn. Those aged between 16 and 34 appear more optimistic with 25% saying they believe their own economic situation will get better. This compares to just 6% of 45 to 54 year-olds, 8% aged 55 to 64, and 5% of over 65s.

When looking at the policy priorities for Scots, healthcare and the NHS remains the top priority of Scots with nearly half (47%) citing this as one of the top three issues facing Scotland.  A third (34%) cite cost of living and inflation, this has declined eight percentage points from November 2023. One in five (19%) put poverty/inequality among the top three issues facing Scotland.

Scott Edgar, Senior Research Manager, at the Diffley Partnership said:

“The latest findings from the Understanding Scotland Economy Tracker show that public confidence in the economy has taken a massive hit over the last three months.

People are reporting that concerns over money matters are impacting their work, home life, and health.

With two-thirds of Scots expecting the economy to worsen over the next twelve months, many will be looking to next week’s Scottish Budget as a chance to offer a signal of confidence in the nation’s economic future.”

Susan Murray from the David Hume Institute said

“With the Scottish Government’s budget just over a week away, there is an opportunity for Finance Secretary Shona Robison take on board the large number of people struggling financially.

“However, as the weather turns colder, it feels like there is a long hard winter ahead for many. I hope all political parties take on board the large number of people feeling so stretched as the political horse-trading starts to get the Scottish budget passed. 

“The economy will not turn a corner and productivity will not increase until more people are sleeping easily at night and not lying awake worrying about money.”

  Notes to editors: 

• Designed by the Diffley Partnership and the David Hume Institute, the survey received 2,233 responses from a representative sample of the adult population, aged 16+, across Scotland. Invitations were issued online using the ScotPulse panel, and fieldwork was conducted between the 1st-5th November. Results are weighted to the Scottish population (2021 estimates) by age and gender.  

Image credit: sharing thumbnail image by Claudia Wolff, free from Unsplash on 24.11.2024

Blog: Are we singing a new song?

29th August 2024

by David Gow, DHI Trustee

"Fings can only get worse," Sir Keir Starmer intoned in the 10 Downing Street rose garden on August 27 in a reverse reprise of Labour's 1997 campaign song . "Before they get better." He added that the UK should "accept short-term pain for long-term gain." It's a tough ask but maybe Scots at least are up for it.

Perhaps, indeed. What emerges from our latest quarterly survey of voter sentiment towards the Scottish Economy, Understanding Scotland, is that Scots are increasingly torn between feeling (a shade) more upbeat and anxious, between modest optimism and continuing pessimism.

Certainly, more than half (56%) of the 2227 respondents to the survey conducted exactly a month after the July 4 General Election still think Scotland is heading in the wrong direction but that's six points down on the record 62% in May while those believing the opposite are up four points at 23%. 

What's more, fears about the cost of living/inflation at 58% are down close to levels last seen in January 2022 (56%), probably reflecting the upturn in earnings and even (some) lower prices. (The survey pre-dates Ofgem's announcement of a 10% hike in energy guide prices). Most tellingly, those thinking that general economic conditions are worse than 12 months ago have fallen to 52% (net) or the lowest level since the survey began in October 2021. Personal negativity is down to 42% from a high of 65% in November 2022 while optimism is up to 15% (net) - hardly a dizzying decline but worth monitoring to see if it upticks

As we and our colleagues at the Diffley Partnership say in the report's intro, "a growing proportion are unsure about the country’s direction, suggesting a populace still searching for clarity in uncertain times." As we point out, there remains a significant sense of precarity, notably among families with children.

Unhealthy options among the poor

More than one in five (22%) is still cutting back on fruit and veg to cut food bills, a bad signal for a nation fighting rampant obesity, while a similar number is reducing meal/portion sizes to save money - the same goal pursued by the 14% skipping meals. It's surely bad news that more than a half (52%) admits to shopping on price rather than health, while a quarter or more is eating processed food and/or cheap food requiring little or no cooking. And we know from here and elsewhere that it's poorer parents, particularly young mothers, who skimp on meals so they can feed their kids.

Financial resilience remains worryingly high among less well-off households. A third of households with children are not confident they could raise £100 in an emergency without borrowing, a level that rises to 58% when the required loan is £500. Inequality may not be a substantial policy issue (at just 8%) but poverty remains among the biggest priorities (27%).

Tax and spend alerts

Ahead of the October 30 Budget (UK) and the Scottish Government's renewed brake on spending, concern about manging public finances is on the up - at 29% compared with 24% a year ago. And a third remains convinced spending on public services is an important issue facing the Scottish economy. Rachel Reeves' "black hole" is clearly and understandably putting the wind up a lot of folk., including actual and/or potential pensioners (a concern for 12% or up three points on May.)

Will hospital consultation/treatment waiting lists come down? Obviously, it's too soon to tell but healthcare and the NHS remain by far the biggest concern (51%) - compared with the mere 8% thinking of the constitution, an issue that does not win elections. Nor, surprisingly, do green/climate change issues (just 11%, down one point on May).

Unsurprisingly, however, immigration and crime are rising up people's political agenda, with the former at a survey peak of 13% (up three points on May) and the latter at a new high of 11% (up two points). The two are often wrongly linked, notably in tabloid media, but both may well prove growing headaches for the new UK government. We shall closely monitor trends here.

Overall, it's clear from this survey that the new UK government and whichever administration emerges from the elections to Holyrood due in May 2026 have a lot to do to convince a sceptical population that those "sunlit uphills" can be glimpsed around the corner. Again, hardly surprising after this dreich summer...

End

Image credit: sharing thumbnail image by Austin Chan free from Unsplash 29.08.2024

New Report: Who will do the jobs in Scotland?

Current employment rates in Scotland are at a near-record high. However, Scotland’s population is ageing fast and there is a low birth rate.

By 2041, the pension-age population is projected to increase by 265,000, while the working-age population is only projected to rise by 38,000.

This report discusses the challenges facing Scotland with changes to migration patterns and a shortage of workers. What can we do to meet the labour supply challenges in Scotland. Who will do the jobs?