Happiness is underrated in the workplace. While most leaders understand that employee happiness is important, many have struggled to tie it to a core business metric.
How does workforce happiness impact costs, earnings, or efficiency?
Happiness is closely tied to productivity. According to research by MIT, self-reported happiness is a predictive measure of performance — a much more reliable predictor of productivity than employee engagement.
So why is it so often overlooked by many organizations?
In this episode, Jason and Jordan explain the connection between employee happiness and productivity, building a case for why employers should care about the happiness of their people from a business perspective.
They urge leaders to view human flourishing as an orienting principle in their business to support the happiness and productivity of their people.
Key ideas and highlights
- Most leaders dismiss happiness off-hand as a “soft” or “qualitative” metric that doesn’t have anything to do with real work.
- People experience sustained happiness when they move toward a highly valued goal.
- When we study the tie between employee happiness to productivity, we find that happy employees are more productive than their unhappy counterparts.
- Studies mentioned in this episode:
- Influence of Positive Affect on Intrinsic and Extrinsic Motivation
- Happiness and Productivity
When we view our work as a means of contributing to society, we start to view our personal productivity as a means of driving human flourishing. This orients us to something that’s bigger than ourselves and requires that we take our personal happiness seriously. — Jason Murray
Learn more about how you can retain employees and reduce the costs of your people programs with Fringe.
Word of the day
- 26:07 Tantamount ✨
- 2:20 — Why employee happiness is an important business metric
- 5:00 — 3 different definitions for happiness: Eudaimonic Wellbeing, Fulfillment, and Hedonic Pleasure
- 8:29 — How to accurately assess employee happiness
- 9:35 — Is happiness a “soft” metric or a core business metric? Why is it overlooked?
- 13:51 — Why businesses aren’t set up to drive happiness
- 16:47 — Why leaders should care about the happiness of their people
- 17:01 — Gen Z is poised to be the most philanthropic generation ever. Why?
- 20:30 — Leadership approaches that inspire happiness and productivity vs those that don’t
- 24:21 — What happens when we view human flourishing as an orienting principle
- 27:37 — How does happiness tie to productivity?
How many hours and years of our lives do we spend on work for nearly all of us, we spend 30 plus years and one third of our days in our vocation, more time perhaps, than we spend at rest or at play. But this isn’t a problem. Why? Because work is good. Work needs to be integrated deeply into our lives and must be in line with our most important goals and values. And if it is, we have a far more complete and fulfilling life experience. Welcome to How People Work, podcast, where we explore the intersection of how humans think and act and how they apply themselves to their work. When you understand both of these things, you’ll be equipped to be insightful, compassionate, and compelling leaders. Welcome back to How People Work. My name’s Jordan Peace. I’m sitting here with Jason Murray, my co-host. Excited to talk to you today about some very, very technical topic about how to get the very most out of your people. We’re going to talk about time management. We’re going to talk about change management, so much management. What is
What is Change management? I don’t even know.
We’re not going to talk about — None of those things.
Will there be stakeholders?
That would be absurd. There will be stakeholders. No, actually we’re going to talk about something that actually in real life helps employees be productive and it is happiness.
Crowd goes quiet. Yes. Happiness. In fact, we are not researchers. We are not academics necessarily, but through much research, have affirmed the fact that happiness is actually a key — has a key tie to this idea of productivity amongst employees. And it’s also just a really good thing all by itself.
All by itself. Yeah. Well, it’s probably a little ironic because I mean, my role in Fringe until recently has largely been talking with customers and prospects for the better part of four years. And whenever I would talk to people people or HR people you would not get any kind of pushback whatsoever around the notion of happiness for people or employees being a good thing. And so the disconnect seemingly is executives and company leaders, like ourselves that for whatever reason, don’t connect with that or don’t feel that it’s maybe a business metric that merits any kind of real inspection when it comes to thinking about how you run your organization or measure things that are relevant when it comes to people and whatnot. And so that is something that we hope to dispel today because there are many facts and much research that I think draw a very direct line between happiness and productivity is something that ought to be really core to what we’re trying to do as both people and individuals and as a company.
Yeah. Last week we attacked work-life balance, and today we’ll attack the notion that happiness doesn’t matter. This is becoming a little MythBusters-ish, I believe, but I’m totally fine with it.
Well, we were just looking at a old Super Bowl commercial of the office linebacker, so now I’m just imagining him tackling these ideas. That’s super cheesy. <laugh>. Sorry, guys.
Can I say nerd alert again? Yeah, I think I’ll squeeze that into every episode and it’ll be really easy to do, actually.
Yeah, it will be. Yeah. I’ll own it fully. So happiness is kind of the key topic. There’s probably a couple propositions that I have here. One, I think is that happiness is underrated for some of the reasons that we just stated, or at least underrated by certain people and leaders within organizations. And that secondly, happiness is a direct driver of productivity, that they’re really closely linked to one another in some ways that we’ll talk about. So I think where it’d be helpful to start is just what do we mean? Yeah. When we say happiness, what are we actually talking about?
Yeah. I mean, I think it’d be important to look at some of what you’ve been reading in terms of how the researchers are defining that happiness, right? But I would hope that it is deeper than the dopamine hit received when we check a box in our to-do list or when someone says a nice compliment, and that thing that fades within about 30 seconds and then kind of we’re back to our default mental state, whatever that was prior to that little dopamine hit.
Right? Right. Yeah. So there’s really three, kind of, main areas, I guess you’d say, that there’s consensus from researchers and psychologists around. So one is just really simple subjective wellbeing. So it’s kind of like how do you define happiness? While it’s whatever you feel, in some ways, is kind of how you would say that. And so if you evaluate your life as positive or satisfying or fulfilling, that the positive emotions associated with that would be defined as happiness. And so another more technical, which I’ll admit I didn’t know before this podcast when I was doing my research, is what they call you eudaimonic wellbeing.
That should have been my word of the day.
But I actually think — yeah that should have been. And so while I didn’t know the word, I think the concept itself is actually very deep and maybe even the most significant way that we could think about happiness. So it’s the sense of fulfillment and purpose that comes from living a meaningful and fulfilling life. And so it’s often associated with autonomy, competence, sense of community and relatedness. And then what we were talking about in the last episode was being engaged with things that align with your most important values and goals. And so that being a key driver of happiness there. And then the third which is maybe the most basic hedonic pleasure which are the emotions and sensations that just come from enjoying some of the more basic things in life myself.
I see. Enough said.
We will leave that one to the side. And I think part of the reason for that isn’t that not important, but most of the research has shown that that particular aspect of happiness isn’t generally associated with sustained happiness. And I think that’s what we want to really focus on here.
Kind of that dopamine hit idea.
Exactly. And so, I mean, an example of that would just be food. So food is something that triggers positive emotion in us. When we eat it, we consume it, it makes us happy but it doesn’t help us develop new skills to move through life or create a drive to experience new things because it satiates. And so that actual satiation, biologically, means that it’s just not going to be something that sustains that feeling of happiness in the same way that purpose, meaning, and fulfillment will. So I think those are important distinctions here.
Well, it’s something that’s coming from without, as opposed to something that’s coming from within.
Yeah, that’s a really good way to put it.
That first definition, which I think is not one to skip over either — that self-defined idea. I’ve offten heard this idea that happiness is a choice. And to some degree, I actually think there’s some truth to that. The perspective, the belief that I have a good life. I have a lot to be grateful. Honing in on what is good and choosing to focus on that I think can have a really big impact on that emotional experience of happiness. I don’t think it’s something to skip over altogether to get to that. Eu-di — Say it again?
Eudaimonic. I’m never going to get that.
Really enunciate that.
Well, eu-dai-monic. Dai-monic? Okay. I just keep hearing demonic in my head. The sense of fulfillment and purpose, this deeper thing like that. Obviously that’s where we’re going to spend most of our time talking about this and studying this and looking at the research. But I also just wanted to call out that first part because we shouldn’t skip over the fact that when you say survey employees, for example, and they say that they’re happy, that should be considered, right? Especially if it’s something that is anonymous and you don’t know. They have no reason to lie when you don’t know who’s answering the survey. So they’re identifying as happy that that’s an important data point.
Well, and it’s actually probably one of the most accurate things that we can ask an employee to report on when it comes to engagement surveys. So some of you all out there might be familiar with Marcus Buckingham’s research, but one of the things that he talks about when it comes to engagement surveys, feedback and things like that, is that we’re terrible assessors of other people, but we’re great and accurate assessors of our own state of being. And so when you ask somebody about their feeling of happiness, we can actually reliably use that in our employment data as a reference point for happiness and things of that nature. So I think it is valid.
Plus one for narcissism. That’s great.
So I think what’s interesting, we mentioned this at the top of the episode, is that a lot of leaders dismiss happiness. The notion of happiness is something that’s maybe soft or just kind of a qualitative metric. It really doesn’t have anything to do with real work. And so, I mean, a question that would be interesting to kick around a little bit is why is it overlooked in that way?
It’s mushy. First of all, right? I think there’s an ego there. There’s a leftover idea that this is a transaction. I’m paying you to do work. Just get it done. Shut your mouth, I’ll pay you money.
I don’t care how you feel.
I don’t care how you feel. Yeah. I don’t have to care how you feel. Why should I?
Happy or Sad.
Doesn’t matter. Right. So I think there’s an unwillingness to engage on things that are emotional. Well, for the reasons I just said, but also maybe the fear of that that’s a slippery slope, that, well, we’re not really supposed to be friends. We’re supposed to be coworkers. This is not a family. It’s a team. Right? And there’s this sense of I don’t want to go there. And also, I don’t know, I guess if you’re a leader and you’re thinking, I’m going to get into an emotional engagement with my employee, this is a person I might have to fire someday. I can’t — I don’t want to know about whether or not they’re happy. So I just think there’s some fears. There’s some fears there. I don’t think their fears are legitimate. I don’t think the fears should cause us to overlook these things. But I’m just you trying to identify some of the reasons why we might push back against the notion, maybe to give them the benefit of the doubt. Maybe they’re thinking, how could I impact that? Even if we study it, what does this work have to do with their happiness if they’re not happy? It’s probably, this is an assumption that’s being made. It’s probably because things aren’t okay at home. There’s probably an issue with this, that and the other. Right?
It’s not the work. It couldn’t possibly be.
Exactly, because we assume what’s happening not at work is what’s kind of controlling their emotional life and their state of being, which it can be, certainly. But it also could be very much about the people in the room or the virtual room or whatever, and those relationships or the task is too difficult or too easy or whatever the case may be.
So, well, it goes the other way too. Yeah. I mean, there’s lots of research on the experience of happiness at home because of what’s happening at work. So it’s a little ironic in some ways that we’re talking about it from the perspective of those things influencing that feeling of happiness and how an employee is at work and how that relates to productivity. But what happens at work very much has a very direct impact on the satisfaction of family members and kids even, in particular.
Yeah. So I think it’s those things. And then probably the thing that you’re trying to dispel here to begin with is that it actually is impactful. So if I don’t believe that this is a statistic that matters, if you tell me that we had a 3% increase in our health insurance claims experience last year, right? Oh, the ears perk, God, what people missing work, what? Our premiums are going to go up? I can tie it to dollars so quickly and so fast that it’s just like, okay, well, there’s a stat I want to hear, right? And so some of it is just, I think the maturity of the research that needs to come out and get more widespread to help people look past, well, it’s a little mushy. Well, it’s a little intimate, but it’s worth looking at. And sadly, typically it’s the financial realities that cause leaders to break through the barriers of their fear and engage with something new.
Yeah. Well, it’s the easiest way, and I mean, you and I have our role in the demands of our positions inside of Fringe have changed a lot over the last four years. And I have some sympathy, I guess you might say, for those leaders. I mean, I don’t think it’s correct, maybe the way the decisions are being made, but you can empathize sitting on a board and being a part of financial conversations and looking at the metrics of a company the way that we’re required to do now, it’s easy to see how you can get stuck on — there’s not a single place on a balance sheet or a PNL that happiness shows up as remotely practical. And so the whole notion of that being something that’s a real core business driver, I think is challenging to say the least.
Yeah, it is. I mean, at best, we’ve got some data at this point that’s pretty firm around retention, and you can tie happiness to retention and then go, oh, okay, now I understand how this saves me money. But the two problems, one, that’s not deep enough financially, it’s not well-rounded enough financially. But also the perspective outside of the finances all together is missing that I work with human beings and I should want to impact them in such a way that I help them to be happier and more fulfilled and to flourish. That should be a goal regardless of the rest of that. So you kind of have to sneak in through the back door of the bottom line to sometimes get people’s attention, but often if you can wake ‘em up and help ‘em remember that these are people, then you can get more fully into the minds and hearts and make some change.
So I think that that’s actually an idea I want to stay on for a few minutes here, because I mean, we have some data and we have some research that we want to talk about that I think helps kind of prove out some of the ROI around this. But I think — I’d love to say maybe more idealistically, why should we care about happiness to begin with? And say, you started to touch on that a little bit, but why should happiness matter to us as maybe company leaders?
Well, happiness. Happiness is like sneezing. And it’s like somebody sneezes — Excuse me, yawns, yawning. I take it back. Not like sneezing. It’s like yawning, right? It’s contagious. Somebody yawns. You got to yawn, okay? You can’t not do it. And the next person does it before you know it, all the air’s gone in the room. But it’s one of those things, you can’t be around a person that is happy and not crack a smile. Somebody that’s just had the best day and they walk into a room or a virtual room and they’re just lit up and they got a story to tell and something great happened and it just catches on. And that is on a shallow, momentary level, but it’s also on a deeper, more permanent level when you are around a bunch of satisfied people that they’re grateful for their life and the relationships in their life, and they just have that attitude.
It just rubs off so much. And the only reason I bring all of that up is because these leaders should care for their own sake. Because the pursuit of helping others be happier is what makes human beings happy. That’s what makes us happy, is the pursuit of helping and uplifting others. That’s why Gen Z is, I, I’ve read in many different places, poised to be the most philanthropic generation ever. They don’t have any money yet. So you can’t measure it on dollars, but on volunteerism, for example, yeah, they’re like 6% higher volunteerism from the age group of 15 to 19 than even the age group of 20 to 24.
Wow, I didn’t know that.
And why? I mean, I’m going to get into a big tangent here, so I apologize, but we talked about this in the last episode, right? Around the what’s gone, each era of human history and what’s become more and more and more true, and then the wealth of your country you live in is that surviving is really easy. When you wake up tomorrow morning, there’s not one time that will ever cross your mind, I hope I have enough food in shelter today.
Or I hope my child doesn’t die from the common cold, right? You won’t think that. You don’t have to think that. That’s wonderful in and of itself. That’s great. But when you don’t spend your time thinking about surviving, you can go one or two different directions. You can think about human flourishing, and you can think about serving others, and you can think about really uplifting those around you so that others can experience that same lack of worry, lack of doubt, lack of anxiety around the basic needs of life. Or you can get just really, really into yourself and just exploring how wonderful and unique you are and how great your thoughts are that no one else has ever thought in human history. And you can get really, really self-centered. And you see people do that. And where does it lead <affirmative>, just misery, right? Just misery.
The self-absorption never leads to a great place. So I bring all of that up just to say, these leaders, if they’re so self-absorbed that they can’t see that the happiness of their employees is important, then they’re really doomed, never experienced very much happiness themselves.
Or at worst, their employees are simply means to an end for their own purposes, which aren’t -
Which won’t be fulfilling, right? Because if they treat their employees that way, they’re going to treat the next people that way once they get the ins that they’re justifying through the means.
So I guess maybe an operating principle here that we could talk about, that’s a vision of happiness. And I think this connects to the concept of productivity that’s rooted in human flourishing. Because what you were talking about there is well, sort of the premise that well, everyone has a right to be happy, and that’s kind of western society infused into the basic building blocks of a free society. And we get to pursue happiness and wellbeing as we define it for ourselves and have the ability to construct that in our lives. And so what would be interesting to talk about now is, well, how does happiness connect to productivity? Yeah. Because those two things maybe seem at odds with one another to some degree.
I mean, it’s not that hard to understand. I know we always take it back to kids. We always take it back to kids. But when I go to my kids and I’m just a big grump, and I’m just like, how does your room look this bad? We just cleaned it two, and I’m not a perfect — I’ve done this speech a couple hundred times, right? We cleaned like two days ago, how is it this bad? What are we, wild animals? Yes, I’m just right. And they are, right, to an extent, and I’m just like, clean it, shut the door. How much happiness is taking place in the room, and how much productivity is taking place in there? There’s two paths that I can take after I give that speech. I can go back in there and I can double down and I can be scary daddy and I can be like “clean it or else,” and they’ll be productive for five minutes out of just kind of fear, right? Out of just like, oh, he was, did you see that? Yeah, that was serious. But I’m going to have to go back in five and a half minutes later and triple down to get another four minutes of productivity out of them, right? But if I walk in, I’m like, guys, check out the room.
Looks pretty terrible. Do you remember what it was like when your room was clean and you had all this room to run around and do cartwheels and explore? And you remember how much fun that moment was when we finished cleaning it last time? Let’s do it again. And then I grab the first toy and I grab the first, whatever, pair of dirty seven year old boy underwear and put it in the, carry it over to the, whatever the damn thing’s called, the laundry basket. And they’re like, let’s do this. Right? And they will work for 30, 40. I mean, these are little kids. They’ll work 30, 40, 50 minutes and they’ll crank it out. And occasionally I’ll have to be like, Hey, are we working or playing? And have to redirect. And there’s a little bit of play in there too. And I don’t even necessarily have to stay the whole time.
I can be like, all right guys, I’ll be back in a few minutes. And they’ll keep working. Because the perspective was, I cast a vision for what it was going to be like when they were done. And I jumped into the work with them, and it was all very, there was no blaming. There was no you suck, no why are you such animals? We didn’t focus on how ugly it was to begin with. And they’re children. We are just children that got old and have more responsibilities. There’s not a great deal of — we didn’t really grow up that much — There isn’t that a great deal of difference between us still figuring it out? And I think why wouldn’t adults work the same way when they see the vision and they feel like they’re on a team and they feel like their leader is willing to go first and to be a part of the work and be in the trenches, why would they not be productive? That feels good. All of that feels very good, kid, adult or whatever.
Yeah, totally agree.
But that was a long monologue, but -
I couldn’t help but think about, so my dad, you know was Marine when I was growing up, and so a common phrase I heard -
Not just a Marine.
He was a drill instructor for a few years as well. So there was a phrase, “Beatings will continue until morale improves”, which I will caveat: I was not beat by my father.
I think that’s like a Dilbert article.
Yeah, I think so. But he loved it. He loved it because, well, being a drill instructor, right? There probably was a little bit more going on.
And you can motivate out of fear. You can. No one’s enjoying it, and they’ll leave you for someone that doesn’t make them feel scared as soon as they can. It’s possible.
Yeah. Well, I think there’s something about this idea of productivity too that’s really important because it contributes to, let’s say, the betterment of human beings in society, or this notion of human flourishing. I think we’ve now talked about it a couple times and in previous episodes. And I think that is an orienting principle becomes really significant because then it’s not even just about happiness for the sake of happiness and kind of self gratification, but it’s also a higher vision when you talked about, in the example with your kids having that vision of, Hey, this is what we’re aiming for together. That kind of motivates the action and the activity. And so when we think about what we’re doing as individuals within teams or within companies or as a society, I think if we could say, well, hey, we’re aiming for human flourishing, all of a sudden the degree of my productivity actually becomes a contributor or detractor from that human flourishing. And so I think it orients us to something that’s maybe bigger than ourselves that puts the happiness in a place that becomes more significant. Because if happiness can help motivate us towards productivity, towards good human ends then that seemingly is a good thing.
Yeah. I think that’s excellent. I think it’s a great replacement for this idea of employee satisfaction. Satisfaction is compared to what? Compared to my last job, compared to doing nothing altogether? <laugh> Like that. It’s not, when you say, are you happy? It’s tantamount to meaning, to purpose, to the core of who you are. And if you could tie work to the core of who people are and why they exist and continue to exist. I mean, you could survey on that one question. And that’s not to say that there’s no other work to be done, but that would be, I can’t imagine a more clear kind of heartbeat check than that question.
Yeah, I totally agree. Well, and the research by psychologists, and honestly, I mean, leading up to this, I read probably a dozen different actual research papers.
I know, you really nerded out on this.
I did. And went really deep. And honestly, it was shocking because some of this stuff that is old, I mean, it’s like 20 years ago, researchers were writing about these things, and I was like, oh my gosh.
Well it can’t possibly matter then, cause no one had any good thoughts 20 years ago. Right? Everyone was an idiot.
Totally. So I mean, it’s just kind of striking to me how far removed these ideas have been from a business setting when they feel, I can’t think of things that feel more relevant in some way than these concepts. And so in some of these studies, psychologists found that what they call positive affect. And so it’s worth distinguishing between happiness, wellbeing, and positive affect. A positive affect is just the manifestation of the feelings that somebody may have. And so in one of these studies, I mean, they did something so basic where they gave people a 10 minute comedy clip and then asked them to perform a bunch of task-oriented problem solving, or they gave somebody a little gift before, like a little bag of chocolates. And those simple things that increased the positive affect that these people felt literally increased their productivity and completion of these tasks. They were assigned by 15 to 20%. So I mean, it was astounding that they felt like, so it increased the interest and satisfaction.
A few laughs, or just the feeling of getting a gift. Not an expensive gift. Just like a few chocolates.
Just like that basic feeling. We’re not even talking about the deeper things surrounding happiness. We’re talking about really surface level happiness kind of things that had such a profound
Pleasure level stuff.
So they found it increased interest and satisfaction in the work. It increased creativity in task execution. So people were more creative in solving the problems that they were given as a result of the increased positive affect. It increased actual performance on the problem solving tasks, especially the ones that were more complex and required creativity for solving. So you think about we’re in a technological world, it’s increasingly complex. The kind of work that’s needed to be done requires increasing creativity, right? What could be more helpful than doing things that help people be more creative? It increased speed in completing the tasks and it increased their focus in completing unpleasant tasks, which I thought was really fascinating too. So I mean, there’s mundane things that all of us have to do in our work. And so even in the mundane tasks that were assigned, it increased the focus in completing those things. And that was just the really surface level happiness kind of stuff. And so what I think is really fascinating is what if we go a little deeper? Cause some ways I don’t even think it’s that hard. So coming back to the notion that we had, I got to really enunciate it. The eudaimonic wellbeing, that’s
Your word, man.
So this is the one that’s associated with your values and goals. And so why I think that matters is if we can help people lay out their values and goals, which in the last episode you said, Hey, one of the things that you could do as an individual if maybe you’re struggling with work or life or just trying to figure it out, is take some time and write down things that are important to you. And actually, that task literally connects very directly to this sense of happiness and wellbeing that you experience. Because psychologists also know that human happiness, that is the sustained variety, is experienced in conjunction with the feeling that we’re making progress towards goals of the highest order that we value and hold in high esteem. And so if we don’t have those goals and values, we’re not going to be able to experience that sustained happiness. And so I think that’s a really unique way to even think about practical implications for how do we go about setting up the employee experience in such a way that people are given the opportunity to maybe think about those things.
Or why prioritize employee experience?
Why continue to prioritize employee experience in a down market, right? Right. I mean, I’ve gotten questions about that. Why are we still spending money to have events and send people gifts and really just enhance people’s day?
It’s right here.
Because it’s the right thing to do. These are people that we’ve intersected in our lives, and it’s the right thing to do to treat them really well. So just sort of on an ethical standpoint, but beyond that, they’re going to be far more productive.
It’s good business.
It’s good business. Well, I’m convinced. I hope our listeners are. It’s been a fun topic. I hope this has been meaningful. I hope especially to any leaders are taken away, <laugh> pay attention to this. Get over yourself that it’s a little mushy. It’s a little soft in the beginning. It is the right thing to focus on and has real life and real world, real business outcomes.
Yeah. We’ll share some links in the show notes as well to the articles. There’s a handful that I think are worthwhile to nerd out on. And there’s some more digestible ones that are easier to read.
They’ll read the long ones, I’m sure. I won’t, but they will. Give me a word. What’s our word for next week?
All right. Word for next week. You ready for it? Malarky. <laugh>.
That’s easy. Yeah. Oh man. That’s going to be a cake walk. Alright, good. Well, thank you for listening. We’ll see you next week on How People Work.