Shorter Workdays Boost The Economy

The year is 1914, and the world is on the edge of the Great War. The Empires of Europe are trying to keep their influence in this ever-changing world, and the clash between them is inevitable. This is the year that will lead to one of the bloodiest wars ever fought. Who to thought that during the same twelve months, one man would change history, and 105 years later, his doing will affect the lives of over 3 billion people on Earth. 

At the beginning of this fateful year, on January 5th, the most prominent industrialist in the world at that time, Henry Ford, announced he’d double the salaries of his employees and reduce their working hours to 40 per week with a 5-day working week. This was huge for the working class. The entire workforce struggled for more than two decades to reduce work hours and improve labor conditions. Up until this point, they found no support from either industrialists and government, and they desperately needed a considerable work provider to champion this idea. And what better man to take upon this job than the most prominent industrialist in the world. 

Ford’s Economic Genius

Ford didn’t embrace the idea of a 40-hour working week out of the goodness of his heart. Nor because he cared about the social life of his workforce. Brilliant as he was, Ford correctly deduced that if his business was to sell his cars to people, they should be able to afford it, and most importantly, they should need it. And why would a laboring man need a car if he has no free time to travel, drive around, and impress others. So he reduced the working hours and raised the wages to $5 daily. That meant that a worker in his company would be able to afford a car with less than a year worth of savings. In the end, what he gave to his employees returned to his company as profits.

Furthermore, he argued that a well-rested worker is far more productive than an overworked one. This thesis was confirmed time and time again in the following decades. Ford was sure that if all industrialists followed his example, this would only boost the American economy and their wallets as well. And he was right. 

After this change, a golden age for the American industry has dawned. Workers from around the world flocked to the United States in search of a better life, thus boosting the economy. The more free time the workers had, the more money they spent. This led to higher demand, higher productivity, and as a consequence – a higher employment rate. The American economy thrived. After the great depression in 1938, the Fair Labor Standards Act was signed, which cemented the working-class privileges that Ford had implemented two and a half decades earlier. Soon almost every country in the world followed in their footsteps and boosted their economy as well.

105 years later

Since that time, 105 years ago, we grew accustomed to working 8 hours, five days a week. One would think that with the automation that’s taking place in every industry in the world, working hours should be shrinking. In 1930 economist John Maynard Keynes in his work Essays in Persuasion argued that a person would work as little as 15 hours a week in 2030. We are a decade away, and we aren’t any closer to this prediction than when Keynes was writing it. 

There are countless reasons why a work provider should reduce the working hours without reducing the payment, and the workers’ happiness and social life is at the bottom of this list. A study from 2014, published in the Atlantic, argues that every employee spends mеrley 45% on average working on their primary duties. What they do with the rest of his time in the office is not productive – mainly pointless browsing on Facebook to pass the time.

Any employer would argue that they should do some extra work if they finish their primary duties in half their work time. Unfortunately, two blockers won’t allow this to happen – fatigue and lack of motivation. Cal Newport, the best-selling author of Deep Work: Rules for Focused Success in a Distracted World, argues that the optimal workday should be around 3 to 4 hours. This is the worker’s capacity to be in a state of deep work without losing productivity, focus, or motivation. This means that during these 3-4 hours a day, the employee does around 90% of their work, and the other 4 hours he is in the office, he is constantly distracted by other stuff. A 2015 Adobe research on emails confirms his theory. The study shows that 9 out of 10 people are checking their personal emails during working hours. Another survey published a year later by Dscout shows that, on average, a person checks his smartphone 2,617 times a day. Next to the time when the employees are traveling to the office, work hours have the highest rate of phone time. 

The only time employees are working hard and not responding to outside distractions is when they are in the so-called state of “The Flow.” The term was coined by Mihaly Csikszentmihalyi in 1975 and determined the state of full devotion to the task at hand. According to a later Mckinsey study, on average, during “the flow,” executives are 500% more productive, and the numbers are not so different for regular employees. 

So what to do

It should be as clear as a sunny day that 8 hours of work daily is an ineffective old practice irrelevant in the modern economy. World leaders and industrialists should take the next step and implement a 6-hours workday. It’s already been tried in many cases, but by far, the most famous of them is the 6-hour experiment in Sweden. Nurses were allowed to shorten their workday by two hours without reduced pay. The trial was two years, and during this time, the effects were visible even to the biggest skeptics. 

In the first 18 months, the nurses logged drastically fewer sick days, and at the same time, their productivity spiked by 85%. Daniel Bernmar, a counselor at Gothenburg’s Elderly care center, shared that the experiment was not only successful for the current stuff, but it provided 17 new jobs.

All studies, without exceptions, show that shorter working hours are highly beneficial to the employee. Considering the decrees in sick days, the lack of burn-out, and the spike in motivation and productivity, it’s safe to assume that businesses and the economy as a whole will benefit greatly from this change. We are at the gate of a new golden age for our economy. With the current technology, connectivity, and globalization, the economy’s boost will be far more significant than the one from a century ago. We are just a small step away, so why don’t we take it?

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