Happy employees are more productive at work. Our report found the link after surveying employees from 900 organisations in 33 industries and 152 countries.

The findings dispel any lingering doubts about the role emotions play in business. And they confirm Happiness is critical for productivity and talent retention – not just ‘nice to have’.

Dr Olivia Sackett, Director of Research and Insights at Virgin Pulse Institute said, “The connection is clear: happy employees are high performing employees.”

She added, “Leaders who understand this and initiate happy habits can reap the rewards from a more productive workforce.”

Despite this, the modern workplace appears to be stifling happiness, not promoting it. A joint study by the University of Sussex and the London School of Economics found that being at work reduced employee happiness by up to 8% – second only to being sick.

Dr David Batman, member of the Science Advisory Board at Virgin Pulse Institute, is a registered Consultant Specialist in Occupational Health with expertise in psychological health at work. He said that, although intangible, negative emotions can damage a business’s bottom line.

“Managers need to remember that an employee’s psychological health can impact their physical health,” he said. “This may manifest through stomach and heart complaints, backache and headaches. In turn, these may lead to reduced performance, increased absence and high levels of staff turnover.”

Given the stakes, Dr Batman urged employers to look for signs of discontent long before they spiral into resignations.

“Interpersonal relationships often provide key insights into whether employees are happy or not,” he said. “So leaders should look around their teams; if there’s a continual lack of collaboration, or tension and conflict, then these may be signs that all isn’t well.”

Dr Batman also had comforting words for leaders prepared to start a conversation about happiness, but concerned about facing scepticism.

“Work is absolutely an appropriate place to talk about happiness,” he said. “As we outline in the study, happiness is a healthy habit. So just as workplace wellbeing strategies create opportunities to manage stress and improve psychological wellbeing, so too should they provide opportunities to be positive.

“Reflecting on achievement, practising gratitude, saying thanks – these are small things. But our findings show they add up to big difference.”

Download the full whitepaper on happiness.