4-day workweeks in the age of Digitalization
published on 11.04.23
We are gradually seeing some companies starting to incorporate new approaches such as four-day workweeks and the digitalization of workplaces. These ideas are finding their way into Western countries, which regard the impact of these new measures with a mixture of fear and anticipation. Talking about these two workplace rethinks may on the surface seem like a naïve debate, given the serious problems of the precariousness and deregulation of the current labor market, but it is by no means an inconsequential issue.
LIVE TO WORK
The length of the working hours is a cyclical debate. Over a hundred years ago (April 1919), Spain became the first country in Europe to officially approve the 8-hour workday. This measure was enacted following protests at La Canadiana, a power plant located on Avinguda del Paral·lel in Barcelona. By contrast, around 25 years ago, France gave the green light to the 35-hour workweek, a measure that no one has dared tamper with, although there have been some attempts. The reality however, is very different, as the French work an average of 38.9 hours per week.
Proposing a four-day workweek instead of the current five is not an entirely new idea. But it is something that some companies across Europe have already begun to successfully trial. It involves working less time but without losing earnings, a measure that can ultimately contribute to improved productivity and the creation of new jobs. For example, this formula has already caught on with more than 20 major Spanish companies in a variety of sectors, which claim to have boosted their productivity. Some well-known British advertising agencies have also adopted this approach, with outstanding results in terms of creativity. There are also other variants, such as in Belgium, which does not plan to reduce the 40-hour workweek, but does allow 4-day workweeks, albeit with a 10-hour workday.
An increasing number of managers and employees in different business sectors support the idea of working 4 days and resting 3 and, although it may seem utopian, it ultimately calls into question the central role that work occupies in all our lives. Introducing a 35-hour workweek and reducing the workday would enable work to be redistributed in a fairer way and help to improve work-life balance. In short, it could potentially make us happier and, as a result, more productive.
The benefits for both organizations and society are therefore clear: improving productivity and reorganizing workloads while allowing people to enjoy life. However, productivity is often discussed as an unresolved issue. In fact, it has been proven that long working hours lead to a decline in productivity, and that 80% of productivity occurs in 20% of the time. If we examine the figures, in Spain people work 1,686 hours a year, according to the Organisation for Economic Co-operation and Development (OECD). In France that figure is 1,475 hours; in Germany, 1,396; and in the Netherlands, 1,413. Productivity per hour worked in the eurozone is 75.9; in Spain this figure is 68.5, while in Germany it is 87.1.
Furthermore, a reduction in working hours would, on paper, also have a direct effect on the gender gap that currently exists in the labor market. It is generally believed that by implementing this proposal for reduced workweeks, women would sign fewer part-time contracts. However, beyond that, in order for the gender gap to disappear and labor inequality to cease to exist, it is necessary for companies to integrate a series of measures into their DNA, such as not hiring by gender, offering equal opportunities for promotion, establishing an inclusive culture, facilitating work-life balance and providing equal pay.
While more and more companies are gradually adopting the 4-day workweek, there are also critics who regard this approach as unfeasible and utopian. At present, not all jobs can be adapted in the same way to this reduction in workdays. It currently seems difficult for self-employed entrepreneurs working marathon schedules in order to launch their business ideas to reduce the number of hours worked, or for SMEs in different sectors to make the initial sacrifice of reducing their hours without impacting salaries. These are just two examples, but it is true that many experts suggest that a good employee experience and increased motivation can be achieved in other ways: more flexible hours, the opportunity to work remotely, fairer salaries, better benefits and a corporate culture that resonates with staff.
THE DIGITALIZATION OF WORK
Albert Einstein once said, “I never think about the future, it comes soon enough.” And the father of the theory of relativity was certainly correct. However, this does not prevent us from exploring the unknown of how the world of work could be. Only by looking ahead can we become aware of the advantages and disadvantages that lie ahead.
In the labor field, many questions are being raised. The challenges we face are formidable, even in Western societies, where work has ceased to be a guarantee of social well-being and where inequalities are widening. There are many unknowns: how can we guarantee quality jobs that are compatible with fulfilling life’s potential? How will digitalization/automation impact work processes? What mechanisms of labor representation will exist in a future of increasing information? How will we address ongoing job instability? These are just some of the questions that should concern us.
The digitalization (and automation) of work is a process that, year by year, has become increasingly prominent in the labor debate. It is not a new phenomenon, but with emerging technologies and advancements, some analysts predict that a third of all occupations in the developed world will be susceptible to automation in the next 25 years. It is believed that the first jobs to be lost will be the ones that are currently performed manually, but it is logical that all those of an administrative nature which, until now, have required the presence and expertise of a person will gradually disappear. This is already starting to happen in public administrations and banking institutions.
It is not new but it is exponential. The ability of machines to replace human skills is progressing inexorably. Surgical interventions performed by robots are no longer the stuff of science fiction. In Japan, billions of yen are invested every year to design machines capable of caring for the elderly, given the serious problem of population aging looming on the horizon. In the automotive sector, there are almost no major brands that do not already have a pilot design for self-driving vehicles. In a few years, once these vehicles have achieved popularity, the battle between cab drivers and Uber or Cabify will forever be in the rear-view mirror.
All this will lead to new models of labor demand. Digitalization and process automation are not destroying jobs, but they are creating fewer of them. For example, Google, Facebook and Twitter have the same turnover today as Ford, Chrysler and General Motors did in 1990, but with just one ninth of the workers. We are faced with a major problem. According to OECD forecasts, one in six middle-skill jobs is at significant risk of automation. However, new positions will also be created.
We are therefore on the precipice of a new revolution that will change the employment landscape. The extent of change remains to be seen and we must be optimistic. The progress of humanity and, by extension, of production models, has always been tied to mechanization. And with each new revolution there has been a group of companies that have resisted change and others that have adapted to the new technology. In other words, the old has always given way to the new. It is only logical to believe that the process of innovation that is currently underway in the market economy and the emergence of new labor reconsiderations will destroy companies and business models that are becoming obsolete and outdated, but at the same time, new talented entrepreneurs will create new businesses and new opportunities that will adapt to the future.
Author: Joan Margarit, Marketing and Communication Analyst.
Learn more about our MSc Marketing Management here:
