The green infrastructure valuation toolkit user guide

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Building natural value for sustainable economic development: the green infrastructure valuation toolkit user guide 7 Labour productivity High quality accessible green infrastructure can support a more productive workforce for employers through improved health, stress alleviation and enhancing motivation or attracting and retaining motivated people. Relevant types of green spaces and features – green space, trees and so on in and around public and commercial premises, including business parks. WHAT THE EVIDENCE SHOWS Research suggests that well planned, accessible green infrastructure can be expected to have an impact on labour productivity. The impacts include: physical health improvements – resulting principally from increased exercise and improved air quality mental health improvements – from the calming effects of the presence of trees and green spaces, and also from physical exercise improvements at work - psychologists have noted that when workers have access to plants and green spaces they can be more patient, better at problem-solving and more productive a reduction in short-term absenteeism. The first two effects are part of health benefits [see section 4] and are qualitative benefits. The third effect – improvements at work - is a localised benefit derived by employers who choose to invest in greening the workplace. US studies show the influence that green space can have on people’s effectiveness and productivity: A 2004 study by The Centre for Health Design saw reduced staff turnover to below 12 per cent – from around 30 per cent - and a 6 per cent increase in a case study hospital’s market share following green infrastructure investment. A 2003 report by The California Energy Commission found that workers in a call centre in Sacramento performed 10 to 25 per cent better on tests of memory function and recall when they had a view of vegetation, as opposed to no view. ASSESSING THE BENEFITS An assessment can be developed considering: how many individuals in the workplace benefit from the green infrastructure investment or the existing green provisions - scale considered how comprehensive the planned green investment is or how extensive the existing green infrastructure provision is - levels of green infrastructure. This enables a qualitative assessment using high, medium and low impact scores, as proposed in table 2. The scale is more likely to be a spectrum - for example, where a site-level investment delivers a comprehensive programme, the impact will be higher than medium. Moreover, working with an individual organisation on a demonstration project would ultimately have important wider benefits when rolled out across a number of companies. Table 2: Impact of green infrastructure improvements on labour productivity Scale considered Levels of green infrastructure QUANTIFYING High Medium Low Several sites One site One site Several Several One organisation organisations organisations Comprehensive Partial Limited or absent The key output is the number of workplace individuals that will benefit from the proposed green infrastructure investment. This will require: an assessment of the number of employees in the company, on the site or across the programme surveys of workers to build up the evidence base on the perceived impact of the green investment. More recently, research undertaken in the US has shown a link between improved green space and problem-solving/labour productivity. 49
Building natural value for sustainable economic development: the green infrastructure valuation toolkit user guide MONETISING In order to estimate the labour productivity benefit of a green infrastructure investment or asset, two impacts need to be considered: the impact on labour productivity - workers’ effectiveness on the job the increased profit - as a result of reduced costs of recruitment. Both impacts enhance overall gross value added (GVA) per firm. However, the key limitation is the evidence to calibrate both effects: the evidence shows that the impact on productivity is generally positive, but it needs to be estimated in terms of higher output per employee and thus a reduced requirement for labour the cost-saving benefit needs to be expressed in terms of a percentage of profit. CASE STUDY: ROPNER PARK, STOCKTON-ON-TEES Ropner Park is an existing urban park that has recently undergone extensive refurbishment and improvement. Use of the recreational value tool has demonstrated that park users are willing to pay an average of £0.96 per visit. This is worth £98.8k per annum, or £822k PV (3.5%, 10 years). See Appendix 1 for full details of the case study. Better evidence for these two indicators would enable a GVA estimate to be made. It does, however, seem possible at this time to assess the reduction in shortterm absence from work that can result from the improved levels of health of those who take up physical activity as a result of a walking or cycling intervention. 2003 research by the World Health Organisation (WHO) in the US showed that physical activity programmes involving 30 minutes of exercise a day reduced short-term sick leave by between 6 per cent and 32 per cent. 120 In the UK, the average absence of employees is 6.8 days, of which 95 per cent is accounted for by short-term sick leave. 121 For each employee who takes up physical exercise for 30 minutes a day, five days a week as a result of a walking or cycling intervention, the annual benefit to employers is likely to be - on average - at least 0.4 days gross salary costs (6 per cent of 95 per cent of 6.8 days). These benefits can be monetised, though it should be noted that these are business benefits rather than the consumer benefits of improved health. In order to calculate the benefits, this figure needs to be combined with the average gross salary costs and the number of affected working people. This can then be combined with average hours worked per day to generate a gross salary figure. 50
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