Productivity and the Workweek - shorter hours
Related:
The<br>Workweek Reduction Equivalent: a measure of potential economic progress
Pre-industrial<br>workers had a shorter workweek than today's
Debate<br>on workweek reduction
Update: since this<br>page was initially published in 2000, the<br>number of hours needed to produce the 1990 worker's output has gone<br>from 32 to 29.
Productivity and the Workweek
Erik Rauch
What if, instead of using productivity increases to buy more<br>possessions, we used them to get more time instead?
Productivity has been increasing exponentially for more than a<br>century. This is one of the most remarkable developments of all time.<br>Until a few decades ago, this bounty has been used both for increased<br>material comfort and for more time. However, in recent decades, the<br>increase has been used exclusively to purchase more things;
hours have actually increased in the US. Meanwhile, there<br>has been little increase in subjective well-being in developed<br>countries in recent decades.
An average worker needs to work a mere 11 hours per<br>week to produce as much as one working 40 hours per week in 1950. (The<br>data here is from the US, but productivity increases in Europe and<br>Japan have been of the same magnitude.) The conclusion is inescapable:<br>if productivity means<br>anything at all, a worker should be able to earn the same standard of living as a 1950<br>worker in only 11 hours per week. The following shows the number of<br>hours per week needed to produce as much as a 1950 worker, using data from the US Bureau of Labor<br>Statistics, including both manufacuring and services:
Number of hours per week needed to produce<br>as much as a 40-hour worker in 1950
In other words, the number of weekly hours needed to produce the 1950<br>worker's output declined by almost one hour per year until the<br>mid-1970's, and has been declining by about half an hour per year since<br>then.
Polls and surveys have shown that people in countries with the standard<br>of living that the US enjoyed in the 1950's are no less satisfied than<br>today's Americans. Indeed, many studies show that income<br>increases people's subjective well-being only up to the point where<br>basic needs are met. However, productivity has increased so much<br>that we<br>can have both the extra possessions and the extra time. Even since<br>1975, supposedly an era of low productivity growth and stagnation in<br>living standards, officially measured productivity has increased almost 70%.<br>The average worker would therefore need to work only 23 hours per week<br>to produce as much as one working as recently as 1975:
Number of hours per week needed to produce<br>as<br>much as a 40-hour worker in 1975
And, if the productivity measures have any meaning, the average worker<br>could have a 29-hour workweek if he were satisfied with producing as<br>much as a 40-hour worker as recently as 1990.
Fast productivity growth is not necessary for reduced work<br>time
Much is made of the rate of productivity growth and its relationship to<br>worker well-being. Overlooked is a much more important fact: because<br>productivity has been growing for so long, it is now so high that it<br>can enable us to sharply reduce working hours while maintaining a high<br>material standard of living. The most important thing is not how fast<br>productivity is growing, but that it is already high enough. We don't need<br>to wait for future productivity increases: the necessary increases have<br>already happened.
Shorter hours and the notion of progress
Interestingly, as an article on<br>labor history notes, shorter hours were assumed to be a natural<br>consequence of increased productivity in the US until the 1930's,<br>appearing in the platforms of all major parties, and the above shows<br>how the workweek would have evolved had the trend continued after World<br>War II. In Europe, reduced worktime has continued to be an<br>issue,<br>and the workweek has been declining in recent times, unlike in the US.<br>However, even in Europe, the decline in work time has fallen far behind<br>the increase in<br>productivity.
Who benefits from productivity increases
According to official statistics, "labor's" share of national income in<br>the US has remained constant over the last 50 years. "Labor", however,<br>includes everyone up to Bill Gates. The troubling<br>increase in income inequality in the United States means that many<br>people do not share in the benefits of productivity increases. However,<br>the potential is there. Furthermore,<br>the increase in inequality is mainly an American phenomenon: it has not<br>occurred, or<br>has occurred on a much smaller scale, in other advanced countries.
Conclusion
The march of productivity is such that its increase in even as short a<br>time span as a decade could be used to dramatically reduce working<br>hours while living standards remained constant.
Postscript
How long can the growth continue? Even if the supposedly slow rate of<br>increase in recent times were continued, productivity would increase<br>120% in the next 50 years, and a 2050 worker would need to work 15<br>hours to...