Liz Truss’s remarks about British workers lacking ‘graft’, and, in the infamous Britannia Unchained text that she co-authored in 2012, being among ‘the worst idlers in the world’, are as frightening as they are ignorant.

Where to begin? Yes, productivity matters – probably more than most people realise. In the real world, as opposed to the abstractions in which it is usually discussed, John Seddon points out, companies create wealth and public services consume resources. If companies create more wealth and public services consume fewer resources, better productivity is a positive double whammy. More satisfied customers and more engaged workers and citizens are a third, although harder to measure. 

And yes again, Britain has an awful productivity record, particularly since the Great Financial Crash in 2008. UK workers are 13 per cent less productive than their G7 counterparts, and the gap is getting wider. Limp productivity is the main reason for the grim reality that the average British worker, unlike almost every other, is worse off than a decade ago in real terms. So both negatively and positively, productivity could hardly be more important.

For a politician who wants to do something about it, however, not more important than having a realistic idea of what productivity is and how to get more of it. And here Truss wants to take us back to the 19th century.

Behind her remarks is the assumption, sadly unquestioned by most managers, that the most important element in performance is human effort. ‘Performance management’ – instructing workers what to do and monitoring to keep them up to the mark – has become a standard part of the manager’s role. Indeed, whole HR departments, equipped with an ever more oppressive surveillance and measurement bureaucracy, have grown up to administer it.

But this is not only the antithesis of productivity, an ongoing generator of friction, bullshit and waste, it is also a roadblock to productivity improvement. The explanation is simple. As Peter Drucker put it, ‘The worker’s effectiveness is determined largely by the way he is being managed.’ Quality expert W. Edwards Deming attributed 95 per cent of performance to the system – the way the work is organised – and just five per cent to the worker. Third-year arithmetic decrees that however hard you drive individuals, the effect on overall productivity can only be marginal. 

But worse than that, the obsession with individual effort blinds managers to the real opportunities for improving productivity that do exist, even in – especially in – the most stretched public-sector bodies such as the NHS that most need them. They are won not by working harder but by working smarter. 

Take, for example, foreign-owned manufacturing plants such as Nissan in Sunderland, Toyota in Derby (and Honda in Swindon before Brexit reared its monstrous head), where British workers and managers have consistently been among the most productive in the world. People certainly work hard there. But their outperformance is not due to their sweat; nor is it a mystery. It is due to their willing engagement with demanding and worthwhile work in return for good pay, respect, fairness, a certain control over the work and opportunities to learn and progress. These principles and the practices based on them have been known and tested over decades in many different settings. As Jeff Pfeffer notes in The Human Equation, which documents this research, ‘it is more important to manage your business right than to be in the “right” industry.’

But such outcomes are out of reach of the many managers, and politicians, who do not share the positive assumptions they are based on. Instead, they are locked into the industrial-age, top-down, hierarchical thinking that in vain pursuit of economies of scale through standardisation and automation has given us a parody of service: dehumanised products and services provided by remote and unreachable companies, and employment as precarious and tightly supervised gigs when it is offered at all. The result is unsatisfied customers and epidemics of stress, anxiety and alienation, not to mention record levels of disengagement, in the workforce. As current labour market developments demonstrate, this is a recipe for a Great Resignation rather than a kickstart for productivity.

if a deregulated labour market, longer-than-average work hours and weakened trade unsions were the key to higher productivity, the UK would already be a world leader. Rather than promising more of the same, would-be UK prime ministers would do better interrogating UK bosses about their bottom-of-the-table record for capital investment and spending on R&D and training. The figures tell a consistent story of preference for the low-road model of relying on cheap labour and underinvestment, and chronic addiction to incentives favouring payouts to shareholders, including themselves, over reinvestment in new opportunities and better service – in the eyes of a number of seasoned observers the kernel of the UK’s productivity, poor service and low-wage problem. (The UK’s negligent water companies offer a malodorous current example of this nexus.)

There are many reasons to be concerned that of the five co-authors of the crude and caricatural Britannia Unchained, no less than four – Dominic Raab, Priti Patel and Kwasi Kwarteng, along with Truss – will have top seats in the next cabinet. In the case of productivity, their ‘remedies’ – more curbs on collective action, harsher legal restrictions – will have a doubly negative effect. First, they are the opposite of what is needed; and second, through the well-documented effect of self-fulfilling prophecy, they risk turning already disengaged employees into implacable enemies of even positive change.

The irony is that we know perfectly well what works. Visit Sunderland or Derby; read John Seddon, or listen to Jeff Pfeffer on YouTube in Gary Hamel’s New Human Movement series. For any new prime minister – or anyone serious about levelling up, alleviating pressures on the NHS, or addressing growing poverty – the urgent priority should be to address the UK’s real productivity issue: the reluctance of companies and managers to adopt principles and practices that are dependably effective, to the benefit of all parties – and the failure of shareholders, fund managers and politicians to call them out for not doing so.