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Poor productivity cost the global economy £446bn last year… as small businesses seek to tackle burdensome admin

Sage research reveals that the global productivity deficit – the economic value lost by business to administrative tasks – rose 2.6% last year, to £446 billion.

London, UK, 21st August 2019 – Sage, the market leader in cloud business management solutions, today launches its second annual Productivity Tracker, which investigates the amount of time lost to administrative tasks.  The study reveals that the global ‘Productivity Puzzle’ is far from solved – in fact it has worsened.  The total amount of economic value lost to admin in the last 12 months totalled £446billion, an increase of 2.6% compared to the year before. 

The Productivity Tracker surveys small and medium sized businesses across 12 countries, uncovering the percentage of time spent during an average working week on unproductive administrative tasks; time that could be reduced by using technology and digital tools. 

The admin burden continues to hold back the productivity of small and medium businesses: 

  • Across the 12 countries surveyed by YouGov, the average time lost to admin, which includes tasks such as chasing late payments, processing invoices and HR tasks, is 5.2%.
  • The analysis reveals that Spain reported the highest percentage of business working hours spent on these tasks, at 10.5%.
  • The nation reporting the lowest amount of time dedicated to these tasks is Canada, where only 1.7% of business’ time is allocated to tasks per year.   

Global Snapshot: We Power The Nation – Productivity Insights  

Country Currency 2019 % time lost to 'admin'  2019 implied productivity loss (bn) 
UK GBP 5.6 40.0 
USA USD 4.9  346.0 
Canada CAD 1.7  18.2 
Australia AUD  4.8  31.8 
Ireland EUR  3.6  2.4 
Germany EUR  3.9  30.0 
Spain EUR  10.5  32.7 
France EUR  7.5  43.2 
Brazil BRL  6.2  77.1 
South Africa ZAR  3.6  7.2 
Switzerland CHF  7.0  48.2 
Malaysia MYR  3.7  56.6 


Methodology

This research has been produced by Sage Group plc (“The Group”). All primary research survey figures, unless otherwise stated, are from YouGov or are calculated by The Group using figures from YouGov.  

To establish time lost, Sage commissioned YouGov to run a survey sample size of 1,466 small and medium business decision makers ensuring a minimum sample size of 100+ in each of the 12 countries analysed. Fieldwork was undertaken between 19th March and 5th April 2019 and carried out online. We summarised findings as a single statistic for SME productivity, based on an average of business time spent on administrative tasks. This is calculated by assigning a mid-point to each of the answer bands for both business size and days spent by the business on administrative tasks e.g. 7.5 for the band 5-10.   

For tracking the cost of lost productivity in 2018, the implied value has been calculated based on 2019 IMF data with changes vs 2018 extrapolated over 12-month changes when compared to the 2018 ‘Sweating the Small Stuff’ valuations. The research has assumed a linear time-bound impact using GDP growth figures taken from the IMF’s World Economic Outlook (April 2019).  

While a compound effect of underinvestment in technology may cause the costs to accelerate through the year, adoption of productivity-enhancing tools for business may counteract this effect.   

About Sage

Sage is the global market leader for technology that helps businesses of all sizes manage everything from money to people – whether they’re a start-up, scale-up or enterprise. We do this through Sage Business Cloud - the one and only business management solution that customers will ever need, comprising Accounting, Sage Intacct, Enterprise Management, People & Payroll and Payments & Banking. 

¹ http://www.oecd.org/economy/oecd-sees-global-growth-slowing-as-europe-weakens-and-risks-persist.htm