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6:36 pm - Thursday September 29, 2016

No Salvation from Productivity Improvements: The Failed 35 Hour Work Week Experiment and Work-Life Balance Examined

| Career, Economics | Rating: 4.5
by Numan
Wouldn’t it be reasonable to expect improvements in productivity to result in shorter work hours? The quick answer: No. It’s up to us.

The famous French 35 hour work week has recently received yet another blow leaving only a shadow of the once grandiose attempt at social policy.

The rational behind the 35 hour work week was to take advantage of the vast improvements in productivity of the 20th and 21st century to increase the workers’ overall quality of life leaving more time for leisure while also reducing unemployment by yielding a better division of labor.

The French policy failed, De facto, leaving France with a relatively high rate of unemployment and poor competitiveness.

The Paradox of Improvements in Productivity

It might be my social conditioning but I must admit I’m a fan of working quite hard myself. I do enjoy my leisure time but it just doesn’t feel right having too much time off. I can’t help but recall the famous paradox from the movie “The Matrix” where the architect explains to Neo why his perfect first version of the Matrix was a monumental failure due to the imperfections inherent in every human being.

We all seem to want more free time, more time with our families and to ourselves. Why, then, would we, as humans, “refuse” to take advantage of the improvements in productivity to do the same amount of work in less time thus enhancing our quality of life?

There are a lot of answers but I’ve chosen to focus on two which I find more interesting.

The Game Theory Answer

Many of us have heard of the prisoner’s dilemma where two prisoners have the dominant strategy of cooperating with the police, telling on one another thus condemning both of them to time in jail (had the two prisoners kept silent they could have walked free but since each prisoners sees “telling” as a dominant strategy when confronted with the other prisoner’s options a rational prisoner would “tell”).

I believe the case of the 35 hour work week is much similar. Had everyone worked 35 hours a week we could have all “walked free” and enjoy our relatively high quality of life earned by the vast improvements in productivity of the last couple of centuries.

However, since each of us faces the strategy of working 36 hours a week and becoming more competitive relative to the others it is a dominant strategy of each and every one of us. Thus 35 becomes 36, 36 becomes 37 and quickly enough we find ourselves working the better parts of our lives away.

The relative indifference and the negligible impact each of us assumes as to our own part in things leads to the never-ending competition. The economic incentive to “break” the 35 hour work week model is enormous.

It is human nature and as such can not be judged as good or bad. I believe we owe much of our achievements to this nature and attitude. The question is whether we get to enjoy these achievements or just watch them from out tiny office window.

The Lump of Labour Fallacy

Naturally, had improvements in productivity reduce the overall “work” needed in a certain market we could have completed this “work” in less time and enjoy more time off as there would be no more “work” to do. This, unfortunately or not, is not the case.

We are all familiar with never-ending back to back assignments. The illusion of our ability to complete our entire to-do list is a strong one. There’s always something else. The available amount of work is not fixed or static but rather flexible enabling us to work as much as we want.

If we only had a fixed amount of work we wouldn’t have a choice and we would have leisure enforced on us.

There are Alternatives

A quick anecdote: A 13th century adult male peasant in the UK worked 1,620 hours a year. A modern US employee works 1,777 hours a year.

We spent a week in Barcelona two years ago and had a very nice time. I distinctly remember how surprised I was to find out shops close during 14:00-16:00 for a famous siesta or just plain time off. Apparently the vast majority of shops close down during these hours and are content enough with their current revenues to appreciate the value of two hours off during the day.

I have often wrote highly on the ability to balance things. Working 16 hours a day maybe profitable but is it economic? Is the utility we derive the highest possible or are we slaves to our cultures?

To put things in perspective here’s a table summarizing the average yearly work hours by country:

If long work hours are not enough minimum employment leave is another good indicator for the ability to balance work and life in different countries. For instance, the French are famous for their 8 week (!) Vacance during summer months. In the Scandinavian countries (remember my earlier post on social equality?) the minimum employment leave, by law, is 25 days a year. In Spain, Russia, Brazil, Switzerland and many other countries the minimum is set at 28-30 days. The less generous employment laws mandate 7-10 days leave in countries like Taiwan, Vietnam and South Korea.

What about the USA? You guessed it – 0 (!). US law does not require employers to grant any vacation or holiday and about 25% of employees receive no vacation time or holidays. For employees that do receive a vacation, 10 working days with 8 national holidays is fairly standard.

So, who has it right? It is subjective but I believe the rising stress levels and stress related illnesses combined with poor diets, low quality of life and relative un-happiness in hard working nations can serve as good indicators.

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