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Future of work: “Less working time can lead to more output”

Some experts keep bringing up a 42-hour week as a possible remedy for the growing shortage of workers. Philipp Frey from the British think tank Autonomy thinks little of this proposal. In an interview, he explains the advantages of fewer working days.

Mr. Frey, you recently presented a study in which you advocate a four-day week. Industry boss Siegfried Russwurm recently brought a 42-hour week into play. Other employers would also object to your study that it was too expensive and ideologically driven. In any case, there is a shortage of skilled workers. How do you counter that?

Philipp Frey: The opposite is correct. Rather, our industrial partners say: The four-day week is our answer to the shortage of skilled workers. They see a competitive advantage over other companies when it comes to recruiting new employees. As for productivity, a number of studies suggest that companies are just as productive after adopting a four-day workweek. After all, the German economy is significantly more productive today than it was before the five-day week was introduced. And, last but not least, absenteeism from work decreases, for example due to lower burnout rates.

In your study, you calculate that a reduction in working hours creates more jobs and at the same time relieves employees. But it is interesting that you only calculated this for the public sector. Why?

Philipp Frey is Research Affiliate at Autonomy, an independent UK think tank dedicated to the future of work.

There were two reasons for this: On the one hand, working time reductions are particularly inexpensive there. This may come as a surprise at first, but a relatively large proportion of the gross income goes back to the employer – for example via income tax. On the other hand, from a historical perspective, the state has often pioneered new working time models.

What were the most surprising results of the study?

The most surprising thing for me was the low cost. Ultimately, according to my calculations, the measure would cost just 11 billion euros more, which is less than one percent of the state budget. On the other hand, we are creating around 610,000 new jobs, which relieves the social systems.

Would that be readily applicable to the private sector?

Not immediately. But when the public sector goes ahead, the private sector is indirectly under pressure. The more exciting question, however, is what the state can do to support private sector actors on the way to a four-day week. In Spain, for example, the government has proposed that companies conduct field trials for a four-day week. The government then subsidizes these field tests. We are currently preparing a corresponding model calculation for Germany.

What is better: a four-day week, i.e. one day off, or a general reduction in working hours?

In my study, I assumed a 30-hour week. That’s what it’s all about: a reduction in weekly working hours. But there are also various reasons that speak in favor of a four-day week – for example the possibility of extending the weekend, or ecological reasons if you travel one day less to the office.

Is it realistic that it can do the same job?

In the public debate, reductions in working hours often appear as thanks to workers who work highly productively. However, if you look at the scientific literature, many decades ago working time reductions were described as a “productivity whip”. They promote organizational and technical innovations that allow existing tasks to be carried out in less time. Less working time can therefore lead to a comparable output or more. In my view, that would be a classic win-win situation.

John Maynard Keynes even predicted that by 2030 we would only be working 15 hours…

Keynes was right that there is a reduction in working hours in the long term. If we look at Germany, for example, until reunification in 1990 there was a secular trend towards reducing working hours. If you were to continue this trend, we would now actually be working a four-day week. In fact, the working hours here have also fallen. But what we are seeing is a massive increase in part-time work, which people pay for by cutting wages.

Isn’t it possibly enough to create flexibility through generous home office regulations?

I would doubt that from an employee perspective. There are studies that show that home office leads to a strong dissolution of boundaries between work and private life. Of course, this is also desired somewhere in order to better reconcile the two. On the other hand, workers find it harder to switch off. On the contrary, it can even lead to increased stress. Of course, the home office has a certain potential, but offsetting it against a four-day week doesn’t work.

At the same time, your think tank is collaborating on a study in Great Britain that will also try out the four-day week. What are you doing differently there?

This is a very large scale study and a practical field test. We have more than 70 cooperating companies with 3300 employees who have agreed on the “100-80-100” principle. 100 percent of the pay, 80 percent of the hours, but 100 percent of the work. The field test is being researched by us and by colleagues from the universities of Cambridge, Boston and Oxford.

Which companies take part in such a study?

In fact, it’s very broad. When it comes to reducing working hours, the first thing that often comes to mind is industrial production. But now it’s also about service work. For example, we have banks or media agencies on board, but also a “Fish & Chips” shop with a relatively small workforce.

What motivations do these companies cite?

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The goals are relatively varied. Many hope for a productivity boost or that they can increase employee loyalty. Companies with four-day weeks actually always have one element in common: they have less fluctuation in the workforce. Many companies also assume that employees have experienced reduced working hours as a result of Corona. Many do not want to go back to this old routine.

What is your impression: is Germany ready for the four-day week?

Historically, Germany has always been at the forefront of new working time models. It’s a bit different at the moment. In Germany it’s not like there is no movement at all – but in other countries like England, Spain and Iceland it is currently even stronger.

Jannik Tilla spoke to Philipp Frey

The interview is first at Capital.de appeared

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