Open Thread March 24 2024 Shorter Work Week – Is It All It Promises to Be?
A New Norm: Senators Bernie Sanders and Laphonza Butler presented an intriguing idea: making a shorter work week a national norm. The bill they introduced proposes changing the standard workweek with no loss in pay for certain groups of employees, including many hourly workers, from 40 to 32 hours, at which point overtime pay would kick in. Whether that change sounds quixotic depends on whom you ask. But as Sanders said in a statement:
“Moving to a 32-hour work week with no loss of pay is not a radical idea.”
Trying to understand the math of this proposal. Let’s say an employee gets $30/hour for 40 hours/week. That’s $1200/40 hours. Now the week is 32 hours, no loss of pay. That’s $37.50/hour. Now the employer still needs 40 hours of work. Eight hours at %150. Those 8 hours come in at $37.50 x 8 x 1.5 = $450. So 40 hours work goes from $1200 to $1650 if done by the same worker. I won’t speculate except to say this could go in several different directions; maybe workers capture a bigger share of income versus profits; maybe this accelerates a conversion of “full-time” careers to (multiple) “part-time” careers; maybe AI and other automation gets a quick boost for broader applications.
Every complex problem has a solution which is simple, direct, plausible — and wrong.
~ H.L. Mencken
Every complex problem has a solution which is simple, direct, plausible—and wrong.
~H.L. Mencken
Well I don’t think this will become law this year and when this (or something pretty close) finally does – which I truly think will happen, maybe in my lifetime even – it will take decades to figure out the impact. Climate change policy and maybe AI might have greater effects by then in any case.
Your math assumes that every hour has the same productivity.
Arne
not sure i follow you. i have no idea what the 32 hour work week with the same pay as 40 hrs people are thinking.
but ultimately “productivity” is in the hands of the bosses. organization and automation go a long way to determine the “productivity” of a worker. and the rest is determined by the market value of what the worker produces.
at least in part a worker “should” be paid according to his time. that is his life he is burning up for his boss. it deserves a real living wage.
the highest wages in this country are “earned” by the people who contribute tthe least value…except of course that “value” is determined by what the traffic will bear.
afraid i have to agree with eric on this 0ne. even if you could arrange to not having to pay overtime…
some work requires continuity… i would have refused to work on something if someone else was going to come in and finish the job or just mess up what i was in the middle of.
not sure here if joel is talking about eric’s simple solution or bernie’s.
on the other hand, i am sure AI could replace new daze journalists without anyone noticing.
i managed to never work in a factory, but mostly i had bosses who thought like factory work.
i was on a crew once that was so efficient we could finish a days work in about six hours. we had a boss who was smart enough to leave us alone. on the other hand, i have had many bosses who reward efficiency by dreaming up some make-work…idle hands, you know. when we had idle hands we invented ways to be more efficient. our reward was to be left alone. different kinds of work require different kinds of answers. computers were supposed to make human work for human beings (no more rows of “engineers” with slide rules doing comlex calculations by the factory system. but as it turned out it turned humans into computers…cannot tolerate departures from “the program” even to deal with problems not anticipated by the programmers. and now the “owners” are so far removed from production that they don’t even know what business they are in, and nobody working for them cares.
To be clear, I do not propose any “solutions” just a few possible responses the system might have. Certainly there are many other possible ones.
well, i agreed with his first comment anyway.
One thing to keep in mind here is if that 8 hours off becomes a 3 day weekend instead of 5 shorter days, we’ll a whole lot of people I know consume lots of energy/carbon on their days off. If the employers don’t see a reduction in energy use – and not sure why they would if they needed the same production with the same equipment etc – then the net impact could be more carbon burn.
Maybe the AIs will take over on Fridays (or Mondays), keep the economy humming.
The idea is not as radical as it sounds…the average work week is now only 34 hours a week, as it has been for years. The radical part is that by holding pay constant with reduced hours, the average worker would get a 6% pay increase. Horrors!!!
JohnH
i don’t know about horrors. Keeping pay the same sounds like zero increase to me.
we don’t live by the hour. the problem is not the pay or the hours but how to make it work. I don’t think it can. you can’t suddenly increase pay or reduce production 25% without inflation. nor, i think, can you manage any sane “continuity” of work that involves more creativity than assemly line work.
Maybe there will be wage reductions in the “second job” employment universe. All of a sudden a lot more people have more time, but not more money!
Eric
if that were true it would be an enormous gain in quality of life.
Distribution of the 34 average could be quite interesting. I recall 30 hours/week was considered full-time when ACA still had an employer mandate. Bet the ‘lower’ 30s is a low spot on the distribution. I just wonder if firms start to sense this is where it will be in 5 years or so, will they start planning now and just create new jobs that comply at compensation they like? ‘Your work week will be 32 hours and your wage $X and when the law changes your wage will still be $X.’ It would make for interesting times for sure if a firm had a lot of 40 hour workers and a lot of 30 hour ones. I can imagine the displeasure figuring out that ‘those guys only work 2 hours more than I do and get $25K more per year!’
John:
That is a good point. Furthermore, Direct Labor is the smallest portion of the cost of manufacturing.
Bill
I still havn’t figured out if by “direct labor” you exclude costs of social security, medical care, mandated workplace safety…in other words labor costs that don’t show up as direct wages not mandated by government.
last sentnce was clumsy..SS is “direct wages” but mandated by government. i have no idea how business accounts for that (e.g “emplyer’s share” of SS)
Dale:
SS would be Overhead the same as healthcare insurance, sick time off, etc. Direct Labor is the cost applied to building a product.
Bill
we have been through this before. every time you explain it, i still don’t know. don’t worry about it. one day we will straighten it out, but not today.
‘Garbage Lasagna’: Dumps Are a Big Driver of Warming, Study Says
NY Times – March 28
Decades of buried trash is releasing methane, a powerful greenhouse gas, at higher rates than previously estimated, the researchers said.