More than 150 years ago, workers in New Zealand, closely followed by Australia, were the first in the world to secure an eight-hour working day. And 75 years ago, we achieved that great boon, the weekend.
Over subsequent years, until the 1980s, we saw a steady reduction in standard hours of work, including the achievement of four weeks of annual leave, widespread long-service leave and the reduction of the standard work week to 38 hours. Thanks to sustained technological progress, productivity and living standards improved steadily over this period.
The decades since have seen further technological advances, most obviously in information technology. The rise of Artificial Intelligence (AI) is just the latest example. Yet there has been no general reduction in standard working hours in more than 30 years.
This may finally be about to change, with New Zealand again taking the lead. After successfully implementing a four-day week in their own company, New Zealanders Andrew Barnes and Charlotte Lockhart established 4DW Global. As the name implies, the organisation has promoted the four-day week in a number of countries, primarily by helping to implement pilot programs.
The central idea of 4DW is summed up as 100-80-100. Workers receive 100 per cent of their previous wages while working 80 per cent of previous hours and attempting to maintain 100 per cent of previous productivity.
Initial results from trials in Australia and New Zealand have just been released with very positive outcomes. The trial was undertaken by 26 companies in sectors that included professional services, marketing, manufacturing and construction.
All but one indicated an intention to maintain the four-day week after the trial. Companies rated the impact of the four-day week to attract new employees at an 8.3/10, with productivity scoring a 7/10 and performance 6.8/10.
Employees were even more positive, and there was a big increase in self-reported productivity, with more than half (54 per cent) reporting an increase in their current work ability compared to their lifetime best.
Almost all participants (96 per cent) reduced their work time, with 88 per cent getting one full additional day off per week. When asked how much additional pay they’d require in their next job to go back to five days, 35 per cent of employees said 26-50 per cent more, 9 per cent would require more than 50 per cent, and over one in ten (11 per cent) say no amount of money would induce them to go back to five days.
Two factors have played a central role in the success so far of the four-day workweek trials.
First, progress towards reduced working hours and better conditions only takes place when the balance of supply and demand in the labour market favours workers. This was true for the Victorian stonemasons who first won the eight-hour day in Australia, and it is true for large groups of workers today.
By contrast, many managers, whose working conditions are usually comfortable, typically prefer to undertake longer working hours. Having made this choice, they are keen to see their subordinates working as well. As a result, most employers have pushed back against limits on working hours.
Second, the pandemic showed us that just because particular ways of working have been around for a long time, this does not imply they are the only possible way of doing things, let alone the best. We rapidly discovered that for most kinds of information work, it wasn’t necessary to turn up at an office five days a week. Against their will, in some cases, managers have been forced to adapt to a world in which a large proportion of their workforce is out of sight much of the time.
The rise of remote work, and the shift in the balance of power in the labour market, has granted workers more autonomy over how and when they do their work and allowed them to set and maintain boundaries between work time and home time. It is thus not surprising that many want to get their work done in four days, rather than five.
The shift to a four-day week has the potential to improve our lives in ways that go beyond an increase in leisure time. Gender balance should be improved, partly by making full-time work a more feasible option for many women. The increase in hourly pay rates implied by a four-day week should flow through to part-time workers, primarily women.
Shorter working hours can also encourage men to take a more active role at home. The 4DW survey found that 27 per cent of the men in heterosexual relationships increased their share of housework and 17 per cent of men in heterosexual relationships increased their share of childcare.
Environmental and health benefits will arise from reductions in time spent commuting (around 36 minutes per week on average) and increases in time spent on exercise (30 minutes per week).
The shift to a standard four-day week is long overdue, given the technological improvements of the last four decades. While still in its early stages, it seems likely to become a reality sooner rather than later.