Recent events have upended working life, changing how and where we work and live, and inspired many to guess on how economies and our lives will forever change. Some argue everything will go back to normal. Others that everything will change. I believe some things will change, to a certain extent, but that many things will remain the same. In my opinion, many of the things that are fundamentally inefficient and/or wrong might even be magnified in the aftermath of this worldwide event.
In an attempt to drive the discussion towards a positive change on how we live and work, which is likely predetermined to failure, I decided to write this article. There is no doubt that this is a time where many are questioning the economic model we live by, either by choice or force. I truly believe this reassessment can be beneficial and, as such, here are some of my thoughts and evidence I found on the implementation of a 4-day workweek.
Foolish as it may sound (and I do consider myself a fool), leading disruption can feel like an island and it is always good to know that there’s a place where there are others like us. People who get it. Many of us would have smirked if last year someone told us we would all be working from home before the end of Q1/beginning of Q2 2020. However, some companies were fully prepared for it and many adapted quickly. With this in mind, I would invite you to read this foolish idea and proposal which may prove to actually make sense.
The case for a 4-day workweek
Scientific evidence and some real-life examples seem to indicate that a 4-day workweek promotes sustainability, from an economic development, environmental and social wellbeing point of view. In other words, if implemented, countries would be exploring a multiple dividend policy; for workers, companies and the planet.
Many argue that our economic model and labour law are fundamentally wrong. In this context, reviewing the workweek should not be perceived as the silver bullet, but, rather, as a policy proposal within an overall reform of the model. Some examples of policies that could, and should, go hand in hand with this proposal are the transformation of transport systems to promote the use of more sustainable energy sources, measures promoting the transfer of jobs from fossil fuel-intensive industries to more sustainable sectors, the use of a pricing system integrating the full costs associated to products and services (e.g. inclusion of environmental degradation into account in their decisions), among other.
Nonetheless, and interestingly, many argue that the 4-day workweek is fully aligned with the interests of all stakeholders. Thus, it may be considered as the first step towards a sustainable framework of public policy centred on an integrated governmental approach.
Many companies worldwide have implemented the 4-day workweek without increasing the number of daily work hours. These examples are disruptive and question, to some extent, the culture of many companies and some countries. However, these examples show, to some extent, an increase in the quality of life of employees, improved financial results of the companies and higher levels of protection of the environment. Reinventing our economy in order to make it more sustainable is inevitable and extremely challenging; thus, the need for dialogue on this type of pioneering and uprooting proposal for change, rather than focusing the discussion on the symptoms developed due to an imperfect system created, not so long ago (even though we tend to think things have always been this way).
Our current economic model (even though changes have taken place recently) tends to prioritize profits over workers wellbeing. I do not say this with any type of negative connotation. As a business owner myself, I believe that profits go hand in hand with wellbeing. At the end of the day, profits generate wealth for the company. Wealth that can be shared with employees, reinvested into the company, used to generate more employment, among other micro and macro-economic benefits.
A 4-day workweek has shown to increase workers work-life balance, reducing stress and work satisfaction. It is also estimated that this measure led to increased dedication and motivation of workers at work. In fact, many studies predict that a significant percentage of sick leaves are due to recurrent excessive volume of work. Furthermore, evidence indicates that most workers would like to work less than 5 days per week, if given the choice; which further supports this thesis.
Evidence was gathered across several countries, such as the United States of America, France, Mexico, Canada, the United Kingdom, Australia, Germany, India and New Zealand.
It seems that fewer workdays per week would lead to reduced stress and anxiety, as well as increase significantly workers’ wellbeing and leisure time. Additionally, and from a macro-economic point of view, it could allow for further job redistribution as a possible means to answer societal changes brought about by automation and artificial intelligence. If successful, this measure could, on a secondary level, and in line with what was just said, promote diversity at work.
These benefits have a direct impact on health. Reduced stress levels and overall increased quality of life is expected to reduce episodes of mental and physical disease. Therefore, one could argue that implementing a 4-day workweek could lead to reduced costs to national health systems.
In New Zealand, a company from the financial sector implemented the 4-day workweek for its 240 workers. A study realized showed that productivity increased significantly (since output remained stable and input reduced significantly – hours of work). It seems that this increase is due to reduced sick leaves and work accidents.
Another study, developed in Australia, showed that workers over 40 years of age are more productive working between 25 and 30 hours per week. Based on surveys on over seven thousand people, researchers believe that workers waste less time on inefficient tasks, are more aware of time and develop personal productivity techniques.
Arguably, more leisure time may also drive change in consumer habits. For example, more time for oneself might lead to increased consumption of certain types of products and services or even increased local tourism (as stated by the Prime Minister of New Zealand in early May 2020). This may lead to economic growth and job creation.
Furthermore, data shows that European countries with shorter workweeks are also those with the highest average pay (e.g. Switzerland, the Netherlands, Denmark, Norway, Austria and Belgium).
The emission of greenhouse gases and the total number of working hours have been shown to have a positive correlation. Even though the magnitude of this has not yet been precisely accounted for, recent evidence suggests a potential reduction of 0.8% in the emission of greenhouse gases, 1.46% in the carbon footprint and 0.42% CO2 emission for every 1% reduction in the number of working hours. Recent data shows that the COVID-19 lockdown led to cleaner air, which further strengthens the link between economic activity and air pollution.
A study realized in the United Kingdom, by think tank Autonomy, that also provides consultancy services for companies trialling the 4-day workweek, estimates that, based on carbon emissions levels for each hour of work, in order to be carbon neutral, we would have to reduce work hours by a staggering 80%. In other words, workweeks of 9 hours (approximately).
A 4-day workweek has a huge potential in promoting the protection of our planet and reduce global warming. Existing economic models rely deeply on daily commuting (often long distances) between home and work and on the consumption of carbon dependent products (including foodstuff). Reducing commuting to work could have a significant impact on pollution and the carbon footprint per worker.
Reducing the workweek by one day also has an impact on the energetic needs of companies. Maintenance and operations costs (mainly electricity) of offices can be significantly reduced for specific types of businesses.
Society has changed the workweek in the past
Changing the maximum number of work hours has been done before, even though we tend not to realize it.
In the nineteenth century, Paul Lafargue argued that 3-hour workdays would be the inevitable result of technological development and increased productivity. Without doubt, he overestimated the impact of these on economic development and, therefore, on the economic and labour model of the West. Many may argue his thesis was largely influenced by political orientations. Still, in my opinion, this argument is worth taking into account despite this potential fallacy and those willing to meaningfully discuss this theme must be able to distance themselves from such biases.
Until the beginning of the twentieth century, 6-day workweeks were the norm. However, in 1914, when Henry Ford successfully managed to increase productivity, he also reduced the workday to 8 hours, doubled the workforce’s wage and introduced a 5-day workweek. Even though Henry Ford’s political views are, in my opinion, highly questionable, clearly evident by the type of proponents he gathered throughout his lifetime, this measure was good business. Henry Ford was a stubborn and results-driven person. He did not start paying his workforce 5 dollars a day (double the baseline at that time) because he wanted people to be happier. He did it because it was good business. He did it, above all, to stabilize the workforce (as described by Bob Kreipke, corporate historian for the Ford Motor Co.)
Similarly, in 1930, during the great depression, John Maynard predicted that within 100 years people would work, on average, only 15 hours per week. According to this prediction in 2030, 10 years from today, we will be working only 15 hours per week. I believe we can all agree that this prediction is far from right. However, we must consider that John Maynard’s ideas fundamentally changed macroeconomics as we know it and shaped the economic policies of governments. However, it may seem, it was only a cherry-picking exercise focusing on whatever reasons led to the construction of the current economic model of the west (which I will not discuss on this article due to my lack of understanding of the intricacies behind this artefact). Nonetheless, it draws attention to the relevance and importance of this issue: reviewing the economic model.
The fact of the matter is our economic model is an artefact created by humankind. Government and policy and decision-makers built it up from the ground feeding from thought leaders across both sides of the aisle. We must not forget that it has been evolving over time. The number of workdays and work hours has changed over the last century. Arguing that it has always been like this and that, thus, it must continue this way is not valid. Arguing that this is a political discussion does not hold either. Thought leaders from left and right have, to different, argued in favour and/or implemented shorter working days and weeks. And most evidence shows it is good business, shows it protect our planet and shows that it makes people happier.