Here's a dumb idea

[Carmen813]

That I'm sure most will hate on, but for curiosities sake I'm throwing it out there. What are your thoughts about changing the normal work week to 32 hours? There is no law set in stone that makes 40 hours considered full time, but that is generally what employers go by.

Obviously would most likely entail a pay cut of some sort for those who work more than 32 hours, but it could also lead to job creation (since private businesses would then need more employees to maintain current levels of production). Has benefit in that you have more free time to do what you please. I could even see that this method results in less problems for businesses, since by having more employees the loss of a single employee has less impact.

I imagine there are other costs/benefits as well. What are your thoughts?

 

[Gonad the Barbarian]

It's not a dumb idea.

There was, for a time, a visionary alternative. In 1930 Kellogg Company, the world’s leading producer of ready-to-eat cereal, announced that all of its nearly fifteen hundred workers would move from an eight-hour to a six-hour workday. Company president Lewis Brown and owner W. K. Kellogg noted that if the company ran “four six-hour shifts . . . instead of three eight-hour shifts, this will give work and paychecks to the heads of three hundred more families in Battle Creek.”

This was welcome news to workers at a time when the country was rapidly descending into the Great Depression. But as Benjamin Hunnicutt explains in his book Kellogg’s Six-Hour Day, Brown and Kellogg wanted to do more than save jobs. They hoped to show that the “free exchange of goods, services, and labor in the free market would not have to mean mindless consumerism or eternal exploitation of people and natural resources.” Instead “workers would be liberated by increasingly higher wages and shorter hours for the final freedom promised by the Declaration of Independence—the pursuit of happiness.”

To be sure, Kellogg did not intend to stop making a profit. But the company leaders argued that men and women would work more efficiently on shorter shifts, and with more people employed, the overall purchasing power of the community would increase, thus allowing for more purchases of goods, including cereals.

A shorter workday did entail a cut in overall pay for workers. But Kellogg raised the hourly rate to partially offset the loss and provided for production bonuses to encourage people to work hard. The company eliminated time off for lunch, assuming that workers would rather work their shorter shift and leave as soon as possible. In a “personal letter” to employees, Brown pointed to the “mental income” of “the enjoyment of the surroundings of your home, the place you work, your neighbors, the other pleasures you have [that are] harder to translate into dollars and cents.” Greater leisure, he hoped, would lead to “higher standards in school and civic . . . life” that would benefit the company by allowing it to “draw its workers from a community where good homes predominate.”

It was an attractive vision, and it worked. Not only did Kellogg prosper, but journalists from magazines such as Forbes and BusinessWeek reported that the great majority of company employees embraced the shorter workday. One reporter described “a lot of gardening and community beautification, athletics and hobbies . . . libraries well patronized and the mental background of these fortunate workers . . . becoming richer.”

From here:
http://www.orionmagazine.org/index.php/articles/article/2962/

 

[Schadenfroh]

. I could even see that this method results in less problems for businesses, since by having more employees the loss of a single employee has less impact.

That also means more insurance policies (plus the families of the employees), more pensions, more overhead for HR, more overtime hours, etc for fewer hours worked per individual.

The population is heavily in debt and many live paycheck to paycheck, giving them a massive pay cut via a de facto furlough will cause the housing market and credit market to get much worse as any reduction in the amount that people receive will cause foreclosures and debt defaulting.

 

[MotF Bane]

If that then leads to 4x8 instead of 5x6.4, there is some significant appeal to me.

 

[PokerGuy]

It's a dumb idea because either you'd either have to cut the salaries of all the workers (and of course their bills would not get cut so they'd be in trouble), of you'd raise the cost of doing business significantly for all employers, crushing the economy. Either way, fail.

 

[fskimospy]

I think there's probably some good use for that in certain industries, but it would be really hard to generalize. I absolutely believe that people work harder in shorter shifts though.

 

[PeshakJang]

So an employer should pay people less, and hire more to make up for it?

If I employ 1 person who works 40 hours a week, who would benefit if I hired 2 people to each work 20 hours a week?

Employer would have to pay more for added taxes and benefits.

First employee would take a 50% pay cut.

Should we give everyone a day off? Or work an hour and a half less each day? Don't think this will affect productivity?

 

[Carmen813]

Productivity will depend on the industry. I think you may actually see an increase in certain sectors, especially those with high levels of turnover/burnout. The reason is simple: people will have more time available to counteract the stress created by those jobs. You could, theoretically, even see increased levels of productivity. Saves money because less turnover means less time spent training new people, at least after the initial increase.

The flip of your argument is that working 80 hours a week would increases productivity, and I highly doubt that holds true. There has to be a point of diminishing returns.

The general idea is yes, hire more people at lower wages. I don't doubt that it would require restructuring laws regarding taxation ect, but as far as I can tell that needs to happen anyway.

 

[Carmen813]

It's a dumb idea because either you'd either have to cut the salaries of all the workers (and of course their bills would not get cut so they'd be in trouble), of you'd raise the cost of doing business significantly for all employers, crushing the economy. Either way, fail.

Again, not necessarily. If the average income is lower, prices should theoretically fall. Companies will adjust in order to make their prices appealing and maintain profit margins. More people working means more potential customers.

That also means more insurance policies (plus the families of the employees), more pensions, more overhead for HR, more overtime hours, etc for fewer hours worked per individual.

The population is heavily in debt and many live paycheck to paycheck, giving them a massive pay cut via a de facto furlough will cause the housing market and credit market to get much worse as any reduction in the amount that people receive will cause foreclosures and debt defaulting.

Benefits is where there is a problem...but I'll say this much, I'm not a big fan of employer-based health insurance. Most people will have over a dozen jobs and multiple careers during their lifetime, so it's high time that employer based coverage got an overall or that portability was substantially improved. Same applies for pensions, ect.

I'm also not necessarily saying we flip a switch and this all takes place tomorrow. I would utilize some sort of transitional period over the course of several years (40 - 38 - 36 - 34 - 32) ect. People could always elect to work more if they wanted to, but the hope is that you could live off of 32 hours a week. Hell, we can't do that with most 40 hour jobs right now. I don't think the solution is working more.

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Just wanted to say thanks to those who took the time to respond, definitely gave me some stuff to think about. Slow work day and all

 

[werepossum]

20% less work means 20% less productivity means 20% less income means 20% lower standard of living. Worse, people with resources like houses and land will fight to keep those prices from declining, so we'd take a double hit. Then add a perceived third hit because the things each of us enjoy - movies, books, eating out, vacations - would have to be the things cut.

 

[Gonad the Barbarian]

20% less work means 20% less productivity means 20% less income means 20% lower standard of living. Worse, people with resources like houses and land will fight to keep those prices from declining, so we'd take a double hit. Then add a perceived third hit because the things each of us enjoy - movies, books, eating out, vacations - would have to be the things cut.

If standard of living was pegged to productivity then two income households today wouldn't be at about the same place one income households were at thirty years ago. Over the past 100 years while absolute productivity has skyrocketed, relative productivity has stayed largely the same. Everybody working harder to try and get ahead of everyone else has had the net effect of just keeping folks at relatively the same spot but working continually harder to stay there.

 

[werepossum]

If standard of living was pegged to productivity then two income households today wouldn't be at about the same place one income households were at thirty years ago. Over the past 100 years while absolute productivity has skyrocketed, relative productivity has stayed largely the same. Everybody working harder to try and get ahead of everyone else has had the net effect of just keeping folks at relatively the same spot but working continually harder to stay there.

Two things, growth of government (at all levels) plus free trade. As long as these two things are not rolled back, standard of living is irretrievably pegged to productivity, such that any decline in productivity must inevitably be matched by a decline in average standard of living.

It's important though to remember that we are NOT at the same standard of living as were our parents and grandparents. We have more and much better automobiles, larger and much more richly appointed houses, undreamed of personal possessions. Although I don't own a smart phone or a stereo or an i-anything, I do have a couple of automobiles, a motorcycle, two computers, and more books than everyone I knew growing up owned together. Our standard of living has skyrocketed and we're only now paying the piper for the part that free trade and credit played in this.

 

[Gonad the Barbarian]

Two things, growth of government (at all levels) plus free trade. As long as these two things are not rolled back, standard of living is irretrievably pegged to productivity, such that any decline in productivity must inevitably be matched by a decline in average standard of living.

It's important though to remember that we are NOT at the same standard of living as were our parents and grandparents. We have more and much better automobiles, larger and much more richly appointed houses, undreamed of personal possessions. Although I don't own a smart phone or a stereo or an i-anything, I do have a couple of automobiles, a motorcycle, two computers, and more books than everyone I knew growing up owned together. Our standard of living has skyrocketed and we're only now paying the piper for the part that free trade and credit played in this.

Didn't we already hash this out in another thread?

Edit: Well I did anyway, and my head hurts too much to bother trudging through it again.
http://forums.anandtech.com/showthread.php?t=2154003

 

[Carmen813]

20% less work means 20% less productivity means 20% less income means 20% lower standard of living. Worse, people with resources like houses and land will fight to keep those prices from declining, so we'd take a double hit. Then add a perceived third hit because the things each of us enjoy - movies, books, eating out, vacations - would have to be the things cut.

As I alluded to in an earlier post, I disagree with this linearity of thought. 20% less work does not automatically mean 20% less productivity. It may in fact increase productivity, especially for those who are chronically overworked. People are not robots, we have limitations. This is particularly true in my field.

Wages would likely be lower, but I don't think 20% lower is necessarily accurate. I'm not sure wages and work are even closely correlated with each other anymore. We like to think so, but realistically, it simply isn't true. Those who work hardest are not paid most, even though there is a myth in our society leads people to believe it is true.

It's harder for me to think about how prices of things people enjoy would be impacted. With less discretionary income, prices would have to fall in order to meet profit margins. With increased numbers of people working, the price would rise. It would mean costs would need to be reevaluated. Regardless of what losses people would sustain in material resources, I believe they more than make up the difference with the gain in human resources.