Productivity has become the UK economy’s bête noire since the global financial crisis (GFC) in 2008-09. Cursed with chronic lack of investment in capital and skills, workers’ output per hours worked has put in a sluggish performance since pre-GFC days, when the UK achieved 2-3% annual growth. If annual growth had persisted at even 2%, today’s output per worker would be £5k higher than it is, according to the National Institute of Economic & Social Research.

As a result, productivity has been everyone’s problem. If that wasn’t enough, for the last 18 months, the UK’s recruitment industry has grappled with another staggering challenge: a lack of hiring generally in employers’ orbit. Result: lower volumes of business, falling revenues, decreased profits and redundancies.

However, a flickering light of hope beckoned from the pages of global recruiter Hays’ half-year report of financial results for 2025. Published in March 2025, the company announced profit and revenue results that were in sync with much of the rest of the UK recruitment industry: sad to say, less than aspirational figures in most categories.

But one set of numbers stood out: Hays’ consultant net fee productivity increased year-on-year (YoY) by 5% and 4% respectively in Q1 and Q2. “Our momentum has led the sector over this period,” the company’s financial results report said. “On a seasonally adjusted basis… productivity has increased now for five consecutive quarters driven by our continued focus on operational rigour and resource allocation.”

In the US, consultant fee productivity for H1 2025 was even higher than the cumulative company figures at an increase of plus-40%. In Australia-New Zealand, consultant fee productivity increased by 12% YoY.

The positive productivity news at Hays did not stop at the end of H1. Hays’ Q3 2025 results revealed that productivity had continued to climb, rising by 5% YoY, “driven by our continued focus on operational rigour and resource allocation”, the report said. Over the same period, consultant headcount dropped by 5% and 13% YoY.

Hays has attributed aspects of the productivity increases in its results report to “selective business line exits”, the reallocation of consultants to “more attractive business lines” and “performance-based culture under a new management team” but has not commented further. Its press office recently declined an interview request from Recruiter about Hays’ productivity, saying the company was “not ready to talk about it yet”.

Outside the Hays organisation, research and advisory firm Gartner has recently explored productivity as a priority for CEOs as some traditional avenues of growth show signs of “diminishing returns”, says Brent Cassell, vice president – advisory. “However, productivity remains difficult for most employers to define, measure and impact. It really is a slippery one. I think part of the challenge is, it’s hard to come to any sort of consensus about what it is that can be done by HR leaders and as business leaders to drive productivity.”

Typically, Cassell acknowledges, the C-suite will use an economic calculation to measure productivity in their organisations. “They will talk about revenue per FTE [full-time equivalent employee], right, interesting, consistent with what we’ve seen in a lot of places. Meanwhile, if you ask employees ‘How do you assess your productivity’, you will end up with very subjective measures of their own ‘busy-ness’: a lot of meetings, many emails, thousands of words and millions of lines of code.”

For many recruitment businesses, net fee income (NFI) is the preferred measure of efficiency, reflecting profit per employee. But that may not be the whole story.

“The challenge that creates for our clients,” Cassell says, “is that a lot of HR leaders feel that they are stuck between a rock and a hard place trying to reconcile the productivity increases that CEOs need to fuel their ambitious growth plans in 2025 and beyond, with a need to understand and care for employees who are exhausted, who are burning out.

“So, a lot of the conversations that we’re having with folks about productivity today revolve around three big questions, one being how can we measure productivity? How is it that managers should be communicating those metrics to employees? What about AI – is it really going to deliver the productivity enhancements that many believe it will? Or, finally, one of the bigger controversies these days: are on-site employees more productive than their hybrid peers? Or is it the other way around?”

Cassell continues: “Definitions of productivity tend to share two critical attributes: first is employee efficiency, which is a measure of the extent to which employees are doing quality work consistently at or ahead of schedule.

“The other side of the coin is employee value creation; so what is the value that those employees created by doing work consistently at a high level of quality on time. So value creation is really the extent to which employees are devoting their time and skills to work is results-orientated and focused on organisational priorities.”

Another perspective comes from David Morgan, co-founder of specialist recruiter Morgan Law, who is responsible for developing the firm’s growth strategy and business strategy. The intangible facets of productivity, such as staff turnover, concern him, he told Recruiter.

For instance, Morgan says: “It is reasonable to assume that staff turnover impacts on productivity three to six months before a vacancy is [filled]. In many cases, employee productivity begins to invisibly tail off as they become disenfranchised, quiet quitting or scaling their work back to job description minimums. Then,” he adds, “productivity losses snowball as the employee resigns and works notice, often taking holiday in lieu and winding down to hand-over – and all that happens before there is an identified replacement and the quantifiable staff productivity losses are recorded.”

But there is another way of looking at less than optimum productivity. Jenny Campbell, founder and CEO of The Resilience Dynamic, argues: “Productivity is not about the hours worked – it’s about the quality of thinking and decision-making.”

The foundation of productivity, then, is achieving the highest level of resilience. Campbell recommends that 65% of a person’s time is allocated to focusing on ‘doing’, keeping 35% of the time to foster a combination of perspective, pacing, re-energising and replenishing.

“By embracing the ‘65/35 Rule’, you’re not slacking off; you’re optimising your brain’s capacity to function at its best,” Campbell urges.

And being the most productive you can be.

Achieving the ‘65/35 Rule’

Rather than seeing switching off as a luxury or a distraction, embrace it as ‘intentional freewheeling’ and recognise it as a strategic necessity.

Just as you plan focused work, schedule time for breaks, reflection, or unstructured thinking. Short walks, listening to music, or even staring out of the window can help activate your brain’s creative processes. Rest, leisure and even boredom are essential for mental agility and performance.

Source: The Resilience Dynamic

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