Shorter labor hours need better productivity

The contented of the four-day workweek has returned to the nationalist statement pursuing a connection from the PASOK absorption for a four-day workweek without wage reduction. This connection is portion of a broader planetary statement connected the aboriginal of labor, work-life equilibrium and the interaction of caller technology connected productivity. However, it cannot beryllium evaluated without accounting for the specificities of each economy.

History shows us that astir each large reductions successful working clip person followed important productivity increases – and not the different way around. The instauration of the eight-hour workday and, later, the five-day workweek became imaginable due to the fact that technological progress, amended organized accumulation and improved quality superior allowed companies to nutrient much goods and services successful little time.

Pilot programs for the four-day workweek person been implemented successful various countries, chiefly successful Iceland and Britain, arsenic well arsenic successful ample tech companies successful Japan and the United States. Overall, improved worker satisfaction, reduced burnout and less absences from work were recorded. However, but for the Microsoft lawsuit successful Japan, which progressive a single institution and for lone 1 month, productivity gains usually lagged importantly down increases successful labour costs.

Furthermore, these results cannot beryllium generalized astatine will. Most aviator programs were carried retired successful economies and companies with precocious productivity and technology intensity, successful sectors such arsenic IT, and fiscal and consultancy services. Implementing such a exemplary is overmuch harder successful sectors requiring a changeless carnal beingness and displacement work. In addition, galore of the affirmative results look associated not lone with the simplification successful the fig of working hours, but besides with amended work enactment and the use of caller technologies.

A generalized simplification successful weekly working hours without a proportional simplification successful wages would summation unit labour costs significantly

The Greek system has definite weaknesses that marque such a treatment peculiarly complex. While Greek workers person some of the longest working hours successful Europe, labour productivity is importantly little than the European average. This is besides reflected successful the persistently precocious existent relationship deficit: The Greek system continues to look a debased productivity trap and debased added value.

A generalized simplification successful weekly working hours without a proportional simplification successful wages would, therefore, summation unit labour costs significantly. If weekly working hours are reduced from 40 to 35, labour costs per hr would summation by 14%, while if they are reduced to 32 hours, the summation reaches astir 25%. For an system with already debased competitiveness, that could pb to reduced investment, nonaccomplishment of export shares, a alteration successful maturation and a emergence successful unemployment.

The information that the connection was formulated with notation chiefly to larger enterprises and intelligence work activities is peculiarly problematic. However, it is precisely this portion of the system that usually exhibits higher productivity, greater extroversion and greater imaginable for planetary competition, so there is simply a hazard that the astir dynamic portion of the productive basal would beryllium disproportionately burdened.

This does not mean the treatment connected reducing working clip is unnecessary oregon doomed to failure. The accelerated advancement of AI and caller technologies whitethorn pb to important increases successful productivity successful the coming years. If this happens, conditions for shorter working hours without losses successful income oregon competitiveness whitethorn gradually emerge. However, successful this lawsuit too, a coordinated simplification successful working clip astatine the European level would beryllium desirable.

* Panos Tsakloglou is simply a prof astatine the Athens University of Economics and Business and a subordinate of the Bank of Greece’s Monetary Policy Council.