The past few years have produced a bevy of research reporting the connection between employee happiness and improved productivity.

In one study, economists at the University of Warwick reported that happy employees are as much as 12% more productive than their counterparts, while unhappy employees are as much as 10% less productive.

So why does happiness matter on the job? When we’re happy, our brains are more peaceful and we’re better able to handle challenges and solve problems, we’re more engaged with our work, are more productive, and produce a higher quality of work. The benefits aren’t limited to the individual either:

  • Happy employees positively influence co workers, are more helpful to others, and collaborate better toward common goals.
  • Happy employees in leadership positions make better leaders, role models and mentors, spreading a positive influence throughout the organization.
  • All employees represent the organization to the public, so happy employees are extremely valuable.
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In The Happiness Advantage, author Shawn Achor quantifies the effects a happy workforce can have on an organization’s bottom line: increasing sales by 37%, productivity by 31%, and accuracy by 19%. When employees feel positive about their work, their productivity leads to greater customer satisfaction, loyalty, and profitability. Likewise, happier people get sick less often, decreasing the number of sick days taken. These employees are also less likely to experience burnout, are more likely to go above and beyond for customers and coworkers, and are far less likely to leave the company, decreasing turnover.

Happy employees lead to greater productivity, happier customers, increased profits, less sick time, and less turnover. So where do you start?

Creating a Happy Workplace

In the past, employers linked employee satisfaction to salary and benefits. Most employees appreciate extra money, but long-term happiness depends on much more than financial reward. Following are several low- or no-cost ideas for increasing employee happiness in your organization:

  1. Provide clear objectives and vision. Lack of vision or unclear direction is discouraging to many, and causing employees to question where to invest their time and energy, and decrease productivity.
  2. Transparency. Trust is the cornerstone to happiness. When employees feel like they can trust their employer, they maintain greater loyalty, focus, and quality in their work.
  3. Growth opportunities. When employees feel “stuck,” it negatively impacts motivation. Provide attainable growth opportunities and encourage employees to build the needed skills to grow within the organization.
  4. Give away control. Allow employees to maintain control over parts of their work, such as schedule (telecommuting/job share), environment (decorate work area), work habits (exploring their own methods for achieving objectives), or dress code.
  5. Cut back on meetings. Provide more time for employees to focus on their work rather than attend superfluous or long meetings.
  6. Provide frequent positive feedback. Many employees receive an annual performance review and maybe a merit increase in pay. While appreciated, that recognition soon fades. Spoken or written words of appreciation or affirmation provided frequently don’t cost money, but pay off in dividends in encouragement and motivation.
  7. Encourage social connections. Encourage coworkers to celebrate birthdays and anniversaries together, or to get together for lunch outside the office. We tend to work better with the people we feel more connected to.
  8. Encourage employees to boost their own happiness. As individuals, we can boost our own happiness at work by helping our coworkers, spending 1-2 minutes per day in meditation, or by reflecting on 2-3 things that we are thankful for at work.

Whether your business provides support, a service, or a product, investing time and energy into increasing employee happiness can trickle down to your bottom line. Providing a good company culture is something that is important to us.

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