Is there a way to work smarter not longer and harder? Is there a link between flexibility, time-off, shorter work weeks, fewer hours, and productivity (plus, cost savings for companies)?
I’ve always had a sense of satisfaction at getting the job done and digging to the end of my workload, checking off every last item on that tick-list; however, in many jobs I’ve held in the past, when I had nothing left to do–and even when I’d taken on additional extraneous tasks and work–I still had to sit there for another so many hours, bored, figuring out more to do, and feeling as if I’d wasted my time. Of course, there are jobs out there where people are overworked and have too much to do. In which case, the company probably needs to hire at least a part-time person to pick up the additional workload unless those tasks are non-vital and have no time limit. But I digress. If you find yourself often like me, having finished your tasks, how many of you would work harder during work hours if your work week was shortened (either in hours or in days or both)? I think that forward-thinking companies should embrace the philosophy that many trusted employees (of course, there will always be the slackers) should learn to work smarter not longer at work, by being given more flexibility and more work-life balance (those elusive terms). Let’s explore what I mean.
I’m posing the question are shorter work weeks, fewer hours, holiday time, and remote working mutually beneficial to employer and employee? And will that increase productivity, profits, and happiness? (Spoiler: I think so!)
Let’s re-imagine the future of work. What would that look like and would companies benefit too?
Reaping the benefits
A couple of months ago I wrote a piece called ‘The Future of Work’ in which several concepts were explored but one idea was addressed that Leah Bury wrote about called the ‘The Deceit of Startup Culture.’ The idea explored that ‘anyone is replaceable’ mentally in start-up culture and the idea of giving people ‘benefits’ that weren’t really benefits at all–what’s a ‘fun’ work environment and beer on tap going to do to get you closer to a mortgage or paying off student loans?
In our current landscape, so many companies have moved away from providing actual benefits to employees. They take more and more, reaping increasing benefits, without giving back to those on whom the profit has been built.
People never leave companies where they are overpaid and overvalued. I’m sure I’ve said this before. Perhaps, I heard it somewhere but it has stuck with me. Most individuals who work want to work hard for a company but it has to be a mutually beneficial arrangement. Most companies make at least a 50% gain of net worth on the salary they pay an employee. For example, for a small company, if you pay an employee $50,000 a year, their value to your company is at least $100,000 and that’s with deducting vacation time, sick days, potential turnover, recruitment, other risks of having employees, and so forth. In fact, this figure is rather modest. Many of the large companies make anywhere from $100,000 to $2 million per employee of profit such as Apple, which has a modest ratio. Even if Apple were to pay those $2 million workers $300,000 in annual salary, they’d still far outweigh what that employee costs to them. Along these same lines, CocaCola makes $400,000 per employee and McDonald’s makes $100,000 (of course McDonald’s are franchises). Companies to look out for, though, are energy companies who make around $8 million per head, keeping in mind they hire top industry specialists and expensive engineers and the like. Facebook makes $1 million per head (but 98% of their money comes from advertising–its users are its product!). One article notes that the average revenue per employee is about $190,000 to $210,000 per year. How many companies even pay half of that cost in salaries and benefits per employee?
On the flip side, if companies ever shift to paying, say one-third to one-quarter of their employee’s value, then, you, as an employee have to be worth that cost; you have to work hard for that company to generate profit so that the company can be mutually beneficial. Companies take a risk and a financial cost in having employees in the first place. Outside of salaries they often have to pay sick leave, benefits, health insurance (in the US), and, perhaps, if they are ‘generous’ maternity and paternity leave. So, employees often exchange their labor to a company so they do not have to take on these financial risks. But as stated before, many companies like to offer less and less yet their per-head ratio of gain is ever increasing. I’d like to see this balance shift again to a more equal relationship in which an employee realizes his or her value and has benefits that are functionally equal to that value. Companies are in the business of profit after all otherwise they cannot be operational.
My overall philosophy is to be an asset at work, be productive, and to work hard then have a life outside of work. Many of us are defined by our jobs, but we aren’t our jobs. To me, ‘life’ is the bit outside of work. That doesn’t mean that I don’t enjoy being productive or accomplishing things at work (I do and I’d be lost without that structure and validation); however, life is about accomplishing personal goals–travel, goals outside of work, spending time with loved ones, and so on–and since we spend one-third of our lives working and one-third of our lives asleep, I’d like to gain back some of that work third! Who wouldn’t love to be paid more to work fewer hours and have more holiday time? But, in order to push companies for that better balance, we have to prove (and gently remind) companies that good and valuable employees generate more value for the company than they take from it and that that should be rewarded–both in monetary terms and in extra free time. Which leads me to my point of fewer hours and a shorter workweek for the same pay.
Productivity: are shorter workweeks and fewer hours as productive?
The short answer is yes! Absolutely! Americans seem to have this attitude that working eighty hour weeks is a badge of honor and that never having time off means you’re a model employee. Well, yes, you’re a model at giving a company all of your life without reaping any benefit whatsoever. That’s not to say companies are these big, bad evil entities, but that the relationship should be more balanced.
Let’s discuss productivity. The Organization for Economic Cooperation and Development (OECD) noted via Time Magazine that Mexico was the least productive country with the longest workweek (41.2 hours per week on average); on the flipside, workers in Luxembourg worked an average of 29 hours per week and were the most productive country. Germans, too, are known to be one of the world’s business powerhouses and their products and luxury cars are now synonymous with luxury and they work just 26 hours per week. For an idea of scale, America’s work-week average is 38.6 hours per week, but anyone who has lived in the States knows that many Americans work much longer hours than that.
But even still, Americans work a whole twelve hours and four minutes more than those productive workers in Germany and nine hours and four minutes more than those in Luxembourg–and these are just averages. Does this extra time–amounting to almost an entire day to two whole days–really make a difference in terms of output? Sources say no. Imagine what you could do gaining an extra day or two in your week!
Most studies cite the New Zealand company who trialled the four-day workweek to positive effect (rather unsurprisingly). Employees worked four days and a total of 32 hours per week. Other companies allow four days weeks but do not reduce hours. It seems that despite the BBC, The New York Times, The Guardian, The Harvard Business Review, and others writing extensively on the benefits of fewer hours and shorter workweeks, companies are slow to catch on. Results found that companies found greater productivity with no extra cost of reducing work hours and days.
Ohio University published an infographic on the benefits of working just six hours per day. They noted that 40% of Americans worked over fifty hours per week whereas 42% worked a standard 40-hour week and a further 18% worked over sixty hours per week. That means that almost 60% of the American population works more hours than they are technically paid for (unless there’s overtime) yet they aren’t 60% more productive than other countries, so why is that? Their research, shockingly perhaps, found that in an eight hour day, workers are only truly productive for 2 hours and 53 minutes, so what do we do for the other five hours? Plus, once you’ve been interrupted at work, it takes you 23 minutes to get back on task–and the recent open office plan creates lots of distractions and interruptions. The info-graphic also notes that the human brain has ideal conditions in which for every hour of work, the brain has fifteen minutes of downtime. Workers in Sweden whose hours were reduced were more productive, happier, and enjoyed better overall healthy–all benefits to the employer long term. Let’s hope that employers will catch on and these changes will be seen in the future.
Again, I say this fact not because it’s just a benefit of the employee, restoring much-needed balance and time to pursue other interests or even clear out that closet you’ve been meaning to ‘Marie Condo’ for the last few months but also because it’s a benefit to the employer. Their dollars stretch further because they are paying for time that’s more productive. They are creating employees who do not go off sick as often and sick days cost money. Creating a healthy workplace means that happy workers work more productively for you. Which leads me to holidays…
Is paid time off a benefit for employers too?
Germans who have the most holidays enjoy a better work-life balance, earn more money, work less, and are more productive than many of their European counterparts. Whereas the UK has eight bank holidays, the Germans have nine to thirteen, depending on the state in which they live (for example, Bavaria which is more religious has more bank holidays); the Spanish have fourteen bank holidays; the Swedes and French have eleven. These are required days off per year separate from their annual leave entitlement in which employers have to pay for time off or pay for another day in lieu of that time off. So, for Europeans that amounts to a week and a half all the way up to just over two weeks off per year in addition to their other time off.
Shockingly, the US has no mandatory required leave–not even bank holidays (or the equivalents–paid public holidays) like Memorial Day and Labor Day (for which, like the UK, there are also eight). Paid leave is left up to employers and many Americans have absolutely no days off, no sick pay, and certainly no paternity or maternity leave (which studies show harms both children and parents). The average American has about ten days off per year but that’s after one year of service. The US is the only country in the Western world without such requirements.
In the UK, employees are entitled to a minimum of 28 working days of annual leave, which comprises of four weeks of annual leave and those eight bank holidays previously discussed. But, many UK employers provide much more than this time. Some give up to six or more weeks off plus bank holidays and Christmas closure. Generally, holidays increase with time in service. Germans enjoy an average of 30 paid days off per year with many companies offering even more time.
The Happiness Index notes that companies can actually suffer when employees do not have time off: productivity decreases, stress increases, creativity decreases, mental health problems increase, the risk of heart attack and other illness increases, and numerous other negative effects.
Back to productivity, 9 of the 10 most productive companies were in Europe where vacation is a requirement and maternity and paternity laws were more favorable. Working longer hours with no breaks is harming Americans’ health and not letting them get ahead in the world. So, the bottom line is that fewer hours and holiday time is a benefit to employees and employers alike. Plus, overall workplace happiness means that workers want to stay working for your company. It’s that value ratio again! Which leads to my final point about in-office happiness with the increasing trend of the open office.
The toxic open office: what are the alternatives?
There are several recent articles from the BBC, The Washington Post, Fast Company, Inc, Entrepreneur, PBS, and more as to why open offices are bad for our health. Among many findings, these articles demonstrate that we are 15% (or more) less productive when we cannot concentrate and there’s extraneous noise; plus, there’s that extra 20 minutes spent getting back on task after an interruption. Other studies according to Time demonstrate that men and women need offices of different temperatures for their brains to be optimal. Furthermore, the practice of hot-desking is shown to be bad for employee’s memories (the first BBC link). Ideally, open offices were meant to be more collaborative, but a Harvard Business School study from last year shows that it actually decrease face-to-face interactions; another article puts that figure at 73% fewer interactions. An Inc article notes that open office plans both make toxic bosses inescapable and spread more illness–and they’re terrible for your introverts.
The only benefit to the open office appears to be for the employer who saves money on office space by cramming employees in like sardines and making the spaces ‘flexible.’ But that creates an unproductive office in which employees are unhappy, which is costing companies far more than they realize. One LinkedIn article by Geoffrey James even does the math for you, ‘Offset that [productivity] loss with the cost savings of $172,000 and we end up with a net loss of $578,000, roughly enough money to hire eleven more workers.’ Open offices cost employers much more than they gain in cheaper office space. A solution?
Solutions tend to be moving towards the benefits of working from home–some or all of the time. Of course, there are the downsides of isolation, but for the most part, it seems like the healthiest option for employees overall. Work from home employees report higher company loyalty and an overall reduction in stress levels not to mention employers save money having remote workers (an Ohio University study noted a saving of up to $10,000 per employee each year and the employee can save $6,800 without commuting expenses–a win all around).
Even though many people feel anxiety if they cannot micromanage their employees, working from home creates less absenteeism, fewer sick days, creates statistically more productive employees, and can even have added benefits like around-the-clock working when hiring people in different time zones. Flexibility also creates less turnover (and we all know the cost of recruitment and the cost of turnover can be astronomical) and more motivated staff overall.
Plus, there’s the added benefit to the environment. People aren’t out on the road. They are commuting less, using less fuel. And their mood is increased by not being stuck in traffic or suffering through arduous commuting times. City traffic, anyone? No thank you!
And then there’s the talent benefit. Employers are now free to choose any employee in the country (or in the world) and their talent pool has suddenly increased.
Overall, many companies are skeptical because they think that some employees cannot be trusted (among other reasons); however, studies show the opposite–that workers are more productive from home. There will always be those that will take advantage, but the average person will see working from home as a perk that improves their day to day life and will be an asset to you instead of a drain.
The takeaways*
Overall, I’d like to see a future in which those employees who want to work from home can do. And that there’s more holiday time, fewer days in work, and fewer hours for more pay. The way to get to this point is to show companies that you are worth the quality of your work and not always the time you put into it. This future will mean more flexibility, more happiness, and more productivity. Workers can work smarter not harder. They can fulfil their goals and dreams outside of work. Naturally, not every job can be a work from home job, but every job can move to better pay for fewer hours of work–and who wouldn’t love a shorter work week. Cheers to a three day weekend!
*Please note that this piece is an opinion piece. It expresses my sole opinion and does not necessarily express the views held by anyone at Key Medium or anywhere else I have worked.
Elaine Frieman holds a Master’s Degree and is a UK-based professional editor, educational writer, and former marketing agency content writer where she wrote articles for disparate clients using SEO best practice. She enjoys reading, writing, walking in the countryside, traveling, spending time with other people’s cats, and going for afternoon tea.
