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28 Benefits of Productivity

John Spacey, April 15, 2023

Productivity benefits are the advantages of a higher productivity rate where this is the amount of value created in an hour of work. Productivity is the basis for human thriving and its benefits are profound. A society with high productivity will typically have a higher quality of life as people can create more income with their labor that can be spent on goods, services, risk reduction, savings, public services and so forth. The following are benefits of productivity at the level of a society, firm or individual.

Society

Productivity is the primary difference between developed and developing nations. For example, a nation that produces $300 per hour worked will fundamentally have more resources than a nation that produces $3 per hour worked. These resources can be invested to create higher quality of life. The following are possible benefits of productivity at the level of a society.

Greater international competitiveness	Greater stability and resilience
Greater tax revenue that can be invested in public services such as education	Higher GDP
Higher quality of life	Higher standard of living
Improved working conditions	More efficient products and services
More leisure time	Risk reduction

As a society, it's not easy to increase productivity as this is tied to things like infrastructure, education systems and a thriving private sector filled with innovative companies.

Firms

Productivity is the basis for the competitive advantages of firms that directly relates to revenue, costs, quality and speed. For example, a restaurant that produces $300 in value per work hour is likely to be a much more pleasant place than a restaurant that produces $3 an hour in value. To produce that much value staff would likely have to offer attentive service, faster service and better food. All else being equal, productivity has the following benefits for firms.

Ability to offer better working conditions	Ability to offer higher salaries
Ability to offer more paid time off	Faster turnaround time
Higher customer satisfaction	Higher employee satisfaction
Higher quality	Higher revenue
Less employees	Less errors, problems, issues and incidents

The productivity of firms is related to industry, innovation, talent, organizational culture, technology, tools, processes and design prowess.

Individual

As an individual, productivity will allow you to achieve more in any context such as education, work, small business and in your hobbies. This is likely to bring you several benefits:

Better results at school	Better support from employers
Better working conditions	Greater professional respect and reputation
Greater results in pursuits such as hobbies and sport	Higher income
More leisure time	Social status

As an individual, productivity relates to things such as knowledge, talent, character, work ethic, profession, time management, motivation and self-discipline.