Briefing | Leadership and management capability key to boosting public sector productivity

Our analysis shows that action the government took last year – namely real-terms increases in public sector pay and increases to the funding of public services first announced in the 2024 Budget – may have helped ease recruitment and retention pressures. According to the CIPD Good Work Index, in 2025, public sector employees’ intention to quit was the lowest since the pandemic. Similarly, the CIPD’s Labour Market Outlook shows fewer and fewer public sector employers expecting serious recruitment problems.

Productivity – now and in the future – also depends on the morale and wellbeing of the workforce. Here, our analysis suggests that the picture is mixed. Measures based on employees’ opinions suggest some rebound in public sector morale since 2023 as shown by the measure of job satisfaction in Figure 1.

Figure 1: Job satisfaction, by sector (%)

^{Source: CIPD Good Work Index surveys.}

However, public sector employers are not as sanguine. Whenever asked, they have been more likely than private sector employers to think morale has become worse. And both employers and employees agree that workload and its consequences are a particular problem in the public sector.

The impact of heavy workloads on employees depends in part on the support given by managers. More broadly, there is extensive economic evidence that productivity depends on the quality of management and leadership.

Our analysis suggests that public sector employees think their line managers are, on average, similar to their private sector counterparts (Figure 2).

This may be partly down to public sector organisations being typically larger and having more resources. Nonetheless, there are significant areas where the quality of public sector line management could improve. For example, only about two-thirds of public sector employees said their manager helps them perform well in their job or provides useful feedback on their work. A similar proportion of public sector employees said their line manager was successful in getting people to work together, likely to be important in the organisation and delivery of public services.

Figure 2: Line manager behaviour in the public and private sectors, 2025 (%)

^{Source: CIPD Good Work Index 2025.}

Another area where there is potential for improvement in the public sector is the quality of leadership, with just 43% of employees in the public sector trusting their leaders to act with integrity (Figure 3).

Figure 3: Trust in senior leaders to act with integrity, by sector (%)

^{Source: CIPD Good Work Index 2025.}

These low scores matter as modelling based on data from public sector employees suggests that improving the quality of leadership and people management can support improvements in motivation and workforce retention. Indeed, improvements to leadership and people management could have larger effects on these outcomes than increases in pay.

The plans to make government departments more efficient, released alongside the Spending Review this summer, place great emphasis on the adoption of technology (including AI). But the benefits of technology adoption are most likely to be unlocked in concert with effective people management practices in organisations where there is a commitment to innovation.

Taken together, the evidence suggests that the government should have a stronger focus on improving leadership and people management across the public sector to improve productivity, particularly if it is to see the benefits of technology adoption feed through into more efficient service delivery.