Work longer or shorter?
Not economists decide, but the people
A commentary by Diana Dittmer
07/20/2023, 5:17 p.m
In order to compensate for the shortage of skilled workers, the employer-related Institute of German Business proposes extending working hours. But that’s cheap lobbying rhetoric. People only work more if the conditions are right, it fits into their own life plans and the budget requires it.
The more we hear statements, the more likely we are to believe them. This phenomenon is called the “Illusory Truth Effect”. IW boss Michael Hüther seems to be convinced that it works. With stubborn regularity, the economist demands that we all have to work more to maintain our prosperity. Germany should not rely solely on immigration to distribute work, so his credo, but employees should do it themselves. In an interview with the “Rheinische Post” he has now done it again. Hüther is certainly one of the brightest minds in Germany when it comes to economic issues. But on this subject he doesn’t really get to the point.
Hüther assumes that the German economy will lack around 4.2 billion working hours a year – despite immigration. According to an economist, 1.5 million immigrants would be needed to close this gap. Integrating so many people is too expensive, Hüther argues. But that doesn’t mean that the ultimate solution is a 50-hour week. In fact, that would be just as wrong as relying solely on immigration. It just wouldn’t work either.
From a purely economic point of view, Hüther’s calculations may work out. But the world of work is not a gulag, but a free market – it is regulated by supply and demand. And because the conditions there are unattractive in many places, the trend is going exactly in the opposite direction: towards less work, not more. It is a fact that German productivity has grown less in recent decades, but there are also many reasons other than the supposed laziness of the workforce.
Other well-known economists such as Marcel Fratzscher from DIW Berlin point to the untapped labor force potential among women. keyword child care. Equal pay would be another. It is a prerequisite for attracting women into the labor market. The annual work volume in Germany is one of the lowest in the world? That may be true. But not necessarily because workers in this country are lazy. There are millions of workers who work fewer hours at their job than they would like. Such hurdles should be cleared out of the way. In detail, Hüther also sees it that way.
If the conditions are right, more work is done
Above all, the labor market is not a “corset”, as DIW boss Fratzscher replies to his colleague Hüther in a joint interview with the information service of the German Economic Institute. “Almost everyone wants more flexibility.” Empirical studies show “quite clearly that working less hours increases productivity, improves satisfaction and motivation and leads to fewer sick days,” says Fratzscher. Constructive suggestions should therefore look different: better pay, more home office and creative freedom, for example.
There’s the four-day week: Even if the DIW boss doesn’t believe in a fixed four-day week, field tests – the largest to date was recently in Great Britain – show where things are headed. One day less work, more time for family and free time is simply becoming more and more popular with employees. Studies by well-known scientists come to the same conclusion: The employees are more rested, more motivated – and absent less often. As part of the British pilot project, Will Stronge from the Autonomy think tank confirmed once again that most companies were able to increase productivity or at least maintain it. Admittedly, there are other studies that come to different conclusions. Above all, there are still many unanswered questions regarding full or part-time payment, and it is also not possible to say in general which sectors one or the other reduced hourly or daily model is suitable for. But it is noticeable that most of the companies in such series of tests then retained the model.
Less corset also means flexible regulations for the home office. A new study by Scoop Technologies, which advises firms on how to coordinate hybrid staffing, found that such firms added more than twice as many employees as office-only workers between March and May this year. Nevertheless, many companies are calling their employees back from the home office after the pandemic. That doesn’t make work any more attractive.
The miserable degree of digitization in Germany does not contribute to this either. In 2022, Germany came in 13th place among all EU countries. Not surprisingly, the Scandinavians – as in the rankings for quality of life – are in the top places. Even Slovenia is better digitized than Germany. If Germany were to push digitization forward consistently, there would be more attractive offers for employees, more would be invested in education, people would be more qualified and therefore more productive. The same applies to the infrastructure. For example, if the areas around cities were better connected, if it were easier to commute by train or climate-friendly bicycle, the situation on the German labor market would be different. DIW boss Fratzscher is certain of that: “With significantly higher wages, a better care infrastructure, more appreciation and better working conditions, we have good chances.”
Work-life balance, not just corporate profits
So there are plenty of alternative solutions to Hüther’s working time gap. The real crux of the debate, however, is another: In the end, economic considerations are completely irrelevant to workers. Work-life balance is playing an increasingly important role, especially for young, well-qualified people, no matter how economists and scientists think. They are also willing to pay the price. The loss of prosperity for society is irrelevant. At the same time, they are the very people who don’t have to worry about finding a well-paid job because the demand for qualified workers exceeds the supply. You have the choice. They set the pace on the job market. With more working hours – possibly even free of charge – they are certainly not out of reserve – evil tongues would say behind the stove – to be lured.
A good proportion of the people who are needed by the labor market inherit a comparatively large amount of money and are no longer dependent on very high incomes. According to the Hans Böckler Foundation will be inherited in the coming years even more than previously assumed. That too should not be disregarded. Ultimately, as in any other area, the needs and desires of each individual are different. For some, it’s not worth working, others can’t – because it might not be compatible with family life – or they don’t want or have to. Incentives can help. But in the end it is the free decision of each and every individual. The blanket appeal to work more will not change that. DIW boss Fratzscher therefore considers the increase in weekly working hours for employees to be “illusory” and “counterproductive”. His vision of the job market of the future: “We will simply get a more flexible system.”