Does Employee Happiness Drive Better Workplace Productivity?

Ling-yi Tsai, our HRTech expert, brings decades of experience assisting organizations in driving change through technology. She specializes in HR analytics tools and the integration of technology across recruitment, onboarding, and talent management processes, making her a leading voice in how data intersects with human potential. In this conversation, we explore the provocative idea that a certain level of discontent might actually fuel achievement, while examining the stark reality of engagement statistics in modern hubs like Singapore. We discuss the critical distinction between morale and happiness, the measurable ROI of a positive work environment, and why the most engaged employees might also be the ones closest to walking out the door.

The idea that “unhappiness may be a precondition for achievement” is quite a bold stance for a leader to take. In your experience working with HR analytics, how do you distinguish between a high-pressure environment that fosters growth and one that simply breeds toxic discontent?

When we look at the data, we have to distinguish between “comfort” and “morale.” I’ve seen organizations where the hours are punishing—what many would call a “terrible” work-life balance—yet the morale remains incredibly high because the employees feel their work has a profound purpose. This is exactly what was observed in certain high-performing ministries where, despite the lack of balance, staff felt a deep sense of mission. However, there is a very thin line between a demanding environment and a toxic one. In a healthy but demanding culture, you see high engagement scores coupled with strong organizational support, whereas in a toxic environment, you see the “tuned out” phenomenon. For instance, in Singapore right now, only 14% of workers are actually engaged, which suggests that the “unhappiness” people are feeling isn’t the productive, sharp kind—it’s a sign of a workforce that has largely checked out. If 53% of your workers under the age of 35 are reporting daily stress compared to 37% of older colleagues, you aren’t looking at a group of “sharp” overachievers; you’re looking at a demographic that is physically and emotionally stretched to its limit.

Singapore ranks 36th in global happiness but shows significantly lower workplace engagement compared to its neighbors. What does this disconnect tell us about the “unhappy but productive” myth?

The disconnect is a loud wake-up call for anyone who thinks a miserable workforce is a productive one. While Singapore sits at a respectable 36th out of 147 countries in the 2026 World Happiness Report, the workplace reality is far grimmer. When only 10% of workers under 35 are engaged, you have a massive productivity leak that no amount of national wealth can plug. We often hear the argument that discontent keeps people “sharp,” but the data from Gallup suggests the opposite: a workforce that is not engaged is a workforce that is simply going through the motions. In Southeast Asia, the average engagement is 25%, and globally it’s 20%, yet Singapore is trailing at 14%. This tells me that the “unhappiness” being experienced isn’t a catalyst for achievement; it’s a weight. Achievement requires a level of mental clarity and commitment that you just don’t get when people are purely focused on surviving the workday.

There is fascinating research from Oxford and MIT suggesting that a simple one-point rise in happiness can lift sales by 12%. How should leaders interpret this when designing roles that are traditionally “difficult” or customer-facing?

That 12% lift is a powerful number because it shows that happiness isn’t just a “nice-to-have” metric—it’s a performance multiplier. What’s particularly interesting about that study is that the boost was strongest when staff were handling complex tasks, like renegotiating contracts, rather than just routine order-taking. This suggests that the more “human” and “tricky” the work is, the more the employee’s mood matters. If your staff is “very unhappy”—which was the most common answer in that survey—they might still get the job done, but they won’t have the emotional or cognitive flexibility to turn a difficult customer interaction into a success. In my work with HR analytics, I encourage leaders to see mood as a functional tool. When customers are dissatisfied, a happy, resilient employee can bridge that gap; a miserable one will likely widen it.

We often hear about the “engaged-exhausted” employee—those who love their work but are burning out. Why is this specific group actually more likely to quit than those who are simply disengaged?

This is the most dangerous “blind spot” in modern management. About one in five employees falls into this “engaged-exhausted” category, and the data shows they have higher intentions to quit than even the most disengaged workers. These are your “superstars” who care deeply about the mission, but they are being crushed by the weight of chronic overload. They feel the sensory drain of endless meetings and the emotional toll of never-ending tasks. Because they are “engaged,” they don’t complain as much as the disengaged group, so managers assume they are fine. But eventually, the fire that fuels their engagement also burns them out. When they finally decide to leave, they don’t just leave a vacancy; they take a massive amount of institutional knowledge and passion with them. It’s a tragic loss for any organization because these people wanted to stay, but the environment made it impossible.

If work-life balance is the top priority for 68% of workers, yet low pay has recently become the leading reason for leaving at 44%, how should companies prioritize their HR spend in 2026?

It’s a balancing act that requires moving away from superficial perks. For the fourth year in a row, work-life balance is a top demand, but we cannot ignore that 44% of people are now citing pay as their primary reason for exit, narrowly beating out poor balance at 43%. This tells us that workers are feeling the economic squeeze and are no longer willing to sacrifice their well-being for a paycheck that doesn’t meet their needs. Companies need to stop spending on “wellness days” or assistance programs that merely treat the symptoms of a broken culture. Instead, they need to fix the work design itself. When senior leaders rate their own organizations at a dismal 2.93 out of 5 for preventing chronic overload, it’s clear where the problem lies. You can’t “wellness-program” your way out of a system that glorifies overwork and underpays people. The investment should be in fair compensation and structural changes that ensure the workload is actually sustainable.

Managers are often cited as the primary driver of employee engagement, yet their own engagement is dropping. What can be done to support the people who are responsible for 70% of the team’s motivation?

The fact that manager engagement has slipped from 31% to 22% in recent years is a systemic crisis. If 70% of the variance in team engagement is tied to the manager, and the managers themselves are checked out, the entire structure is at risk of collapse. We’ve placed an immense burden on middle management to be psychologists, coaches, and taskmasters all at once, often without giving them the tools or the time to do it. To fix this, we need to treat management as a specialized skill rather than a reward for technical proficiency. We must provide them with the autonomy to set clear directions and the authority to help their teams push back against unrealistic workloads. If a manager is just a middleman for “chronic overload,” they will burn out just as fast as their subordinates. We need to measure their success not just by output, but by the health and retention of their teams.

What is your forecast for the future of the “unhappiness as a precondition for achievement” philosophy in the global talent market?

I believe the era of glamorizing overwork and “productive misery” is rapidly coming to an end because the global talent market simply won’t sustain it anymore. While the old guard may still believe that “never promising happiness” keeps people sharp, the data is proving them wrong. We are moving toward a model where “sustainable high performance” is the goal, not just “high performance” at any cost. Organizations that continue to ignore the 12% productivity lift from happy workers—or the 14% engagement crisis—will find themselves unable to compete for top talent. In the next few years, the most successful companies will be those that realize you don’t need unhappy people to achieve great things; you need people who are challenged, well-compensated, and, most importantly, given the space to recover. The “unhappy achiever” is a short-term asset and a long-term liability, and the market is finally starting to price that risk correctly.

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