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A MARKET FOR SHORTER HOURS

    One of the factors that exerts pressure on work hours to increase is the fact that some jobs, especially salaried jobs, do not have a clear and defined schedule. An employee can be asked to complete certain task that is due the next day, for example, and if the worker has already been at the office for 8 hours, he or she will stay until the task is completed. In some situations, this scenario occurs every day, where they stay more than the traditional 8 hours per day. However, since the schedule is not really specified, or if it is, there is tremendous pressure to meet the deadline in fear of showing bad performance and losing the job.

    In order for the market for work hours to work there needs to be transparent information (Schor, 1992). Salaried employees, for example, need to know exactly what their schedule is, such as 9am-5pm. This transparency might still not provide workers with a true 40 hour work-week, but at least, having a standard within the firm and frequently going over it, provides signals to the worker that the standard is not respected in that firm and that possibly the option to look for employment somewhere else should be open. Payment for overtime in the salaried worker world, Schor argues, does not necessarily need to be a money payment but could be paid in time off. For example, if a worker needs to stay 4 more hours to finish a task that is due the next day, then, that worker can just work 4 fewer hours the next day or later in the week. 

    If we do not implement such a practice, we run the risk of devaluing our work by giving hour time for free to the employer. As French economist Serge Latouche explains in an interview by Joseba Elola for the Spanish newspaper “El Pais”:

"We have to work less in order to earn more, because the more you work, the less you earn. It is the law of the markets. If you work more, you are increasing the supply of labor, and since the demand for labor has not increased, then wages will go down. The more we work, the more salaries will decrease. We have to work less so we could all be able to work, but, above all, we have to work less in order for us to live better." (Elola, 2013)

    Here, Latouche refers to very simple supply and demand theory to explain how a person who decides to stay longer to finish a task without getting paid for it (either monetary payment or in time off) is devaluing their labor and therefore, wages will tend to decrease. It would be like giving free labor to a firm, and if that is the case, there is no incentive for the firm to increase demand for labor and hire more workers. That would not be the case if the worker could balance the extra hours worked with more leisure during the rest of the week.

    Latouche’s explanation, although logical and accurate, is still not enough to remove people’s fear of lost income due to worktime reductions. If workers have hourly wages and they are told to work fewer hours they will be unlikely to accept those terms, because that would mean that their income will be reduced. Workers are particularly attached to their current incomes, however, an interesting study from 1980 made by Fred Best for the US Department of Labor and the National Commission for Employment Policy suggests that most americans are willing to forgo future pay raises for more time away from work if they were given the choice (Best, 1980). This is important to know because this means that we could trade future income for time off instead of getting our incomes reduced. Juliet Schor explains how this would work in her 1992 best-seller “The Overworked American”: 


“There are two parameters: the amount of income a company is willing to give*, and the fraction of it workers designate toward free time. Let’s assume the former is 2% plus an adjustment for inflation, and the latter is 100%. Then, about a decade from now the average work year will have fallen by 340 hours, from 1960 to 1600 hours per year. That’s enough for an additional two months of vacation or a 6 ½ hour work day. Higher rates produce rapid gains. If a person’s real income were to rise 4% per year and all of it was channeled into time off, after ten years the average work year would be near 600 hours. This person could go to school one semester a year, take a four-month vacation, or follow a five-hour daily schedule year-round.” (Schor, 1992)


    The amount of income companies are willing to give that Schor mentions could come from pay raises the firm will give to workers based on their own productivity increases. Also, keep in mind that, in this example of trading 100% of the productivity increase for time off, wages remain stagnant for the worker, therefore, purchasing power remains stagnant. It would not be a decrease in salary, which is what people would avoid. As Schor explains, the appeal of this scheme is that “what you don’t know can’t hurt you”.

    This way, a market for shorter hours (or leisure) could be created, where employees could choose more leisure if the option was given to them. 

    Additional steps could be taken for the creation of a market for shorter hours or leisure. For example, we could remove penalties for people who chose to work part-time, such as reduced career opportunities or benefits like health insurance. Not only we could extend benefits to part-time workers, but even the existence of a single-payer universal health care system, like most European countries have, would remove the exclusive tie between health care coverage and full-time employment. 

    As you can see, these are simple alternatives that do not require much planning or a dramatic overhaul of the system. We could create a market for leisure and thus, not only balance the upward pressure for work hours, but also to slowly reduce the work-day so we can enjoy more leisure. 



REFERENCES

  1. Best, F. (1980). Exchanging earnings for leisure: findings of an exploratory national survey on work time preferences. National Commission for Employment Policy. Us Department of Labor. Retrieved from: http://files.eric.ed.gov/fulltext/ED189368.pdf
  2. Elola, J. (2013). Hay que Trabajar Menos Horas para Trabajar Todos. El Pais. Retrieved from: http://internacional.elpais.com/internacional/2013/08/15/actualidad/1376575866_220660.html 
  3. Schor, J. (1992). The Overworked American. The Unexpected Decline in Leisure. Basic Books, New York, NY.

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