Productivity rises when companies are facing closure

In companies that are slated to be shut down, productivity increases during the phase-out period itself. When management is busy dealing with matters other than daily operations, employees shoulder a greater responsibility for their work­-and efficiency is enhanced. According to business economist Magnus Hansson at Örebro University in Sweden, this shows that it is possible to boost productivity considerably without investing. This is also an argument for longer phase-out periods, which would benefit both the employees and the company.

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