Policy Innovations, February 2, 2007
Modern life keeps us pretty busy. The demands on our time never end. Work itself is significant enough, but there are thousands of other ways in which we are expected to use our time.
Keeping healthy demands our time. We need our eight hours of sleep, sufficient time to eat healthy meals, and time to exercise daily. Participating as citizens of a market democracy demands our time. We must volunteer our time. We must not only read a paper to stay in touch with the world, but we must read and understand those fat little inserts that come with our power bills and our credit card statements. Few of us do, but how can democracy or the economy work if we are not informed and involved? Our families demand on our time. Raising children takes an enormous commitment of time, from changing diapers, to PTA meetings, to bonding.
The amount of time we choose to dedicate to work not only reaches far in consequences, but it is largely a public choice that must be made in the political arena.
There is literally not enough time in the day to be a model citizen, so something always gives. The children are left at daycare so we have more time to work. To save time running around with the kids and going to work, we purchase automobiles. To save time on laundry, we buy dryers. To save time on those fat little inserts, we toss them away—they’re complicated anyway. To save time on ourselves, we eat poorly, sleep less, and exercise little, making us less healthy in the long run and requiring us to spend more on health care.
Directly or indirectly, saving more time means spending more money, and spending more money means more time making it. It’s a vicious cycle, and how it all plays out varies from society to society.
Strange as it may seem today, 40 years ago, French and American workers spent about equal time at work. An employed American in 1965 worked 1,983 hours, while the comparable figure in France was 2,004. In those days, the French worked as hard, but produced much less. For every hour of work, Americans produced 56 percent more goods and services than did their French counterparts, but the French have since caught up.
Four decades later, it is the French who produce some 7 percent more every hour. Yet the French make considerably less money than Americans—roughly three dollars for every four in the United States. Some commentators—New York Times columnist David Brooks for example—tout this as evidence of a superior American system. This simple reasoning neglects the fact that while employed Americans have reduced their work hours a little and produce much more than they did in 1965, the French have reduced work hours much more.
On account of increased vacation time and a shorter workweek, the French worker spent only 1,434 hours on the job in 2005? compared to the American’s 1,790. In fact, average annual work hours have fallen so fast in France that the country as a whole worked five percent fewer hours in 2005 than 1965, despite putting 25 percent more people to work. And so it goes through most developed economies.
True, workers in other countries earn less money. But they have fewer immediate demands on the cash they do have. Every day off means a day without burning gasoline sitting in traffic, paying for daycare, and getting sick from yet another early morning and long workday. And here’s the kicker—less work means using less energy.
The amount of energy we use, whether in America or in France, is related to how much we produce, and thus how much we work. How large the savings are depends on the details of production. It may not be immediately obvious if, or how precisely, it balances out, but countrywide energy consumption generally goes up with national income. The greater the number of hours demanded of each worker, the greater the energy we consume, and therefore the greater the carbon emissions.
If Americans cut work hours by 14 percent, they would still work longer hours than do the French. This reduction could cut energy consumption and carbon emissions about 20 percent to a level below what the United States emitted in 1990. This change alone would near our target under the Kyoto Protocol. Far from devastating the U.S. economy, Kyoto could be met simply by taking vacations, choosing leisure over labor.
Energy and environmental concerns need not reduce our standard of living. Instead, it is important to realize that our standard of living includes having time off of work as well as having money to spend; that when we choose to have more money to spend, it is often spent not on that which makes us happy, but rather on purchasing the time we spend earning that money.
Importantly, this is not a choice to be made only in the United States. Developing countries have the same decisions to make as they grow. In 40 years, much more of the developing world will be as productive as Germany or Japan is today. Will these newly developed countries choose the high-energy, long work hours American labor model, or go the way of the low-energy, long vacation European model? Their decisions will have consequences for the entire world. If the developing world follows the United States rather than Europe, the result could be two to four degrees Fahrenheit in extra global warming.
Finally, we must recognize that the perception of choice is misleading. Economists like to think in terms of individual choice, and the choice between labor and leisure is a classic case. The real world, however, offers much less flexibility for individual taste. When real wages stagnate and fall, there remain debt obligations to meet, and when there are none, we are each still accustomed to our particular way of life, which requires a certain income to maintain.
Nor does there really exist the flexibility to choose our own work hours. In the economists’ world, we each choose whether we want to work 23 hours a day or only two. In practice there are part-time and full-time jobs. How many banks will hire managers who wish to work 12-hour weeks? McDonald’s may not cherish a fry cook who declares Tuesdays are for surfing at the beach. No, custom plays an important role in determining our work time, even down to our personal preferences.
We aim for standards of living based on what we see around us. Our neighbors matter more than we think. And when we do, we find that vacations, shorter work weeks, and family and medical leave, both paid and unpaid, are options made available in the world of politics, not the workplace. These are less the result of market forces than they are social arrangements and institutions. In the real world, when we talk about work hours, we discuss the rules of the game, rather than the score.
David Rosnick is a Research Associate at the Center for Economic and Policy Research in Washington, D.C.