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The Wrong Way to Shorten the Work Week

August 30, 2004

Tags Global EconomyU.S. EconomyProduction Theory

It's become a common refrain: American workers are badly overworked, driven to a loss of leisure, sleep and possibly sanity by their material and status obsessions. By instead emulating the Europeans, we would be better rested, more productive, and have more time for family and other relationships.

That's been a semi-official slice of conventional wisdom, at any rate, roughly since the publication of Juliet Schor's Overworked American more than a dozen years ago. In her book, Schor concluded that after subtracting work, commuting, sleep and household chores, American adults on average have only 16 hours a week of free time on their hands.

But a few subversive questions might crop up amid one's fighting rush hour traffic and complying with the boss's directives: Could it be that many of our workers see themselves as underworked? And in any event, is it the job of government to decide upon an appropriate length of a workweek?

The French (and European) Dilemma: So Much Work, So Little Time

In France increasing numbers of people are taking such questions seriously—and in a hurry. It was just four years ago that millions of Frenchmen were applauding the enactment of a mandatory 35-hour workweek ceiling. Known as the Aubry Law, after former Minister of Labor Martine Aubry, its backers argued the measure would generate jobs and reduce unemployment. (Long ago, back in the mid-1930s, France, under the socialist government of Leon Blum, had established the 40-hour workweek.) Yet during this decade that nation's unemployment rate has continued to hover at around 10 percent.

Recent polls show that two out of three French workers favor repealing the law.

At least one major company is practicing open defiance. Bosch, the electric appliances giant, recently raised its workweek from 35 to 36 hours. Company officials at the firm had warned that in absence of such action they might have to move operations to the Czech Republic, where wages are far lower.

The French government, with a long history of capitulating to the country's powerful labor unions, is now in a bind. If it refuses to act, it risks the likelihood of other firms defying the law. But if the government goes after violators, it risks a massive flight of capital. President Jacques Chirac and his cabinet have announced they want "more flexibility" in setting work hours. That's a nice way of saying that they don't really like the Aubry Law, but can't say so openly for fear of arousing the unions' ire. Chirac's Finance and Economy Minister, Nicolas Sarkozy, has been somewhat more candid, stating, "To change the 35-hour week is possible and necessary if we want to modernize France."

Next door in Germany, some major companies also are lengthening the workweek. Siemens, the electronics manufacturer, decided it would extend its workweek from 35 to 40 hours, after threatening to move its plants to Hungary, where wages are 80 percent lower. German Railways, similarly, plans to increase its standard workweek from 38 hours to 42. While these increases don't come near the country's maximum 48-hour-a-week maximum, it is clear that even Europeans, who zealously cherish their vacation time (especially around this time of year), sense that it really is possible to have too short a work schedule.

Worldwide Work

This certainly represents a reversal of fortune. For whether due to decree, employer policy, or both, the overall workweek length among the world's major industrialized nations has moved downward. New data provided by the Paris-based Organization for Economic Cooperation and Development, now with 30 member nations, reveal that during 1970–2002 the number of hours worked per capita declined in 14 of 19 nations surveyed (see Table 1). France registered the steepest drop among declining nations with 23.5 percent. Germany, Japan, and the United Kingdom dipped by 17.1 percent, 16.6 percent and 7.2 percent. For the five nations whose per capita hours rose, the U.S. led the way with a 20.0 percent increase in hours, while New Zealand and Canada followed not far behind, respectively, at 17.8 percent and 16.8 percent.

Why have these trends occurred? In countries where per-capita hours have increased, OECD concludes, the driving force has been the growth in overall employment, which has offset the rise in the proportion of workers who work part-time. In countries with declining per-capita hours, the main reason for the change has been reductions in the typical work year through devices such as a shorter workweek, heavy reliance on part-time employees, and more liberal vacation and other leave time. This has led to some major divergences. Adults in the Netherlands on average now work only 1,340 hours a year compared to 2,410 hours for their counterparts in South Korea (not shown in chart).

American Exceptionalism: Weird or Wired

So why is America running ahead of the pack (or behind it, depending on how one views the situation)? It isn't because the federal government repealed an hours-per-week maximum limit that never existed in the first place. And it isn't because Americans have come to oppose the 40-hour threshold beyond which overtime (i.e., time and a half) wages kick in for most wage and nonsupervisory salaried employees.

Could it be, then, that profit-conscious U.S. employers expect employees to become as workaholic as they are? Or, apropos Ms. Schor, could it be that today's employees are slaves, if not to their work per se, than to their misguided craving for luxuries that they rarely will have the time to enjoy anyway?

There's a grain of truth to both possibilities, particularly the latter—those fabled Joneses seem to be harder to keep up with as time passes. But consider some alternative explanations.

For one thing, organized labor in this country, outside of New York City, never really took the 35-hour (or less) week limit beyond the talking stages—and even the talking took place decades ago. In 1932, during the heart of the Depression, the AFL advocated a 32-hour week as a means of "work-sharing."

During the 1957–58 and 1960–61 recessions, various labor officials suggested mandatory 32- or 35-hour weeks to reduce unemployment. In 1962 the AFL-CIO, led by George Meany, officially endorsed a 35-hour workweek. To his credit, albeit out of Keynesian motives, the United Auto Workers' Walter Reuther rejected Meany's proposal on grounds that it would undermine spending power and living standards for Americans generally, and members of his own UAW in particular.

By the end of 1963 a number of unions in New York City's garment, printing and building trades had adopted a 35-hour week. In 1961, the year before the AFL-CIO's proclamation, Local 3 of the International Brotherhood of Electrical Workers had established a 25-hour week—and that was down from 30 hours. But New York always has been the exception, not the rule. Nationally, from the JFK years onward, organized labor has moved toward a firm view that economic growth is more in rank-and-file members' long-term interests than a shorter workweek. Most U.S. workers positively still crave getting a shot at overtime hours during a boom period.

Second, to the extent that employers schedule their employees for a longer workweek, they in turn have grown more attentive to employee requests for special time off or for flexible scheduling (e.g., working out of one's home). This tendency has come to loom large with increased participation of women in the labor force. Even other advanced industrialized nations don't compare with the U.S. in this flexibility. About a decade ago labor economist Daniel Hamermesh compared American and German work scheduling patterns, and found variations in hours and days worked in a given week occurred far more in this country. In part this has been due to the combined private-public-sector unionization rate being twice as high in Germany. It is also due, not unrelated to the previous point, to wider mobility in the U.S. job market. Employers know that if they fail to respond to employees' time requests, they could lose their best workers to competitors.

Third, our country decades ago reached what might be called a natural limit to the shortening of the workweek. During 1900–70 the average workweek declined from about 60 to 40 hours. In some measure this occurred because of the enactment of the Fair Labor Standards Act of 1938 and the establishment of precedent-setting collective bargaining agreements. But on top of that, and arguably more importantly, people do not want to trade off work for leisure beyond a certain point. To make an analogy, an overweight person going on a diet becomes healthier, but only up to certain point; beyond that point, his or her attempts to lose weight are counterproductive, even dangerous.

A 40-hour week, despite inevitable time preference differences across population groups, seems overall a sensible, natural level. Moreover, it is the weekend that Americans seek to preserve more than the eight-hour workday. One suspects that a five-day workweek lengthened to 45 or even 50 hours likely would not meet with nearly the resistance that a six-day, 40-hour week would. Hamermesh found that in the U.S., as in Germany, about 20 percent of the labor force works for at least some of the day on Saturdays, a situation full-time, year-round employees especially sought to avoid.

Fourth and finally, workers who work longer hours just might be enjoying their situation, viewing their work more as paid recreation than labor. One of the more salutary effects of the much-maligned (by conservatives) counterculture style has been the blending of work and leisure, as Virginia Postrel and David Brooks each have explained in different contexts. This has meant, for one thing, a willingness on the part of employers to provide onsite recreational amenities, from health club facilities to meditation rooms.

These days, employers are open to instituting just about any activity, however "weird," if they think it will boost employee morale and productivity. As a recent example (any one of a thousand will do), in March 2001 Toyota's training headquarters in Torrance, Calif., as part of its corporate team-building program, opened a special drum room filled with 150 congas and hundreds of additional percussion instruments such as cowbells and maracas. "You sit down and start beating those drums, and you can let out all the stress and be free, no inhibitions," said one employee. So far more than 3,000 Toyota employees have taken part in the program. Hey, don't try this at home.

On a deeper level, the work-recreation fusion is the result of a mutual recognition by employer and employee that creativity, the spark of every successful company, is best nurtured in the spirit of play, of maximizing opportunities for spontaneous behavior. When work becomes fun, the best minds in an organization seem to operate on full alert, adding to the company's competitiveness and profit margin. Play has rules, of course, but its behavior is open-ended, not constricted. (Recall Postrel's metaphor of beach volleyball.)

The process works in reverse, too. When recreation, at home or elsewhere, becomes a serious pursuit, its participants might well see a business idea in the making, or at least a winning mental attitude. Whether Lance Armstrong's training for, and running in, the Tour de France constitutes "work" or "play" is moot. What matters is that for him cycling is an obsession, especially as it invites the possibility (by now fully realized) of being the best in the world at something.

State Mandates? Non!

All of the above suggests that the term "overworked" can be highly subjective. True, even a classic workaholic has a point at which he says "enough!" But that threshold may vary widely by age, sex, ethnicity, family situation, career satisfaction, and degree of physical exertion in the work. There are, unfortunately, employers who cannot fathom responding favorably to requests for extra time off or scheduling flexibility. Such employers these days pay the price in the form of high turnover rates. Workers, whether individually or collectively, should convey their desires to an employer. But in the end, it is not the job of government to place a ceiling on the amount of time an employee is allowed to work.

Which brings us back to France. Even if that country raises its 35-hour-a-week limit back to 40 hours, there is the larger issue of the defensibility of such ceilings at any level. Don't look now, but even the French are raising this issue. Former French Minister of Industry Alain Madelin, for one, states:

The 35-hour week represents a costly economic mistake for which we have not stopped paying. . . . It is an attack on the freedom to work. What right does the state have to prevent someone who wants to work more and earn more from doing just that?

Those sorts of thoughts might prove contagious.

_____________________


Carl F. Horowitz is a Washington, D.C.-area consultant and author on a wide variety of domestic issues. Formerly, he had served as a Washington correspondent for Investor's Business Daily, housing and urban affairs policy analyst with The Heritage Foundation, and professor of urban and regional planning at Virginia Polytechnic Institute. He has a Ph.D. in urban planning and policy development from Rutgers University. CHoro73851@aol.com. Comment on this article on the  Mises Economics Blog.

SOURCES

Altonji, Joseph and Christine Paxson, "Labor Supply, Hours Constraints and Job Mobility," Journal of Human Resources, Vol. 27, 1992, 256–78.

Borowiec, Andrew. "35-Hour Workweek Failing to Deliver," Washington Times, July 22, 2004.

Brooks, David. Bobos in Paradise: The New Upper Class and How They Got There, New York: Simon & Schuster, 2000.

Cartter, Allan M. and F. Ray Marshall, Labor Economics: Wages, Employment, and Trade Unionism, Homewood, Ill: Richard D. Irwin, Inc., (rev. ed.), 1972, pp. 250-51, 335-52, 429-36.

Cole, Diane. "Joining the Tom-Tom Club," U.S. News & World Report, March 22/March 29, 2004, p. D12.

Hamermesh, Daniel S. Workdays, Workhours and Work Schedules: Evidence for the United States and Germany, Kalamzaoo, Mich.: W.E. Upjohn Institute for Employment Research, 1996.

Lichtenstein, Nelson. "American Trade Unions and the 'Labor Question': Past and Present," background paper for What's Next for Organized Labor? Report of the Century Foundation Task Force on the Future of Unions, New York: Century Foundation Press, 1999, pp. 59-117.

Postrel, Virginia. The Future and Its Enemies: The Growing Conflict Over Creativity, Enterprise, and Progress, New York: Touchstone, 1999.

Schor, Juliet. Overworked American: The Unexpected Decline of Leisure, New York: Basic Books, 1991.


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