UK study says maybe so
Ric Edelman: It's Wednesday, March 22nd. 100 years ago, odds were high that you lived and worked on a farm. That was a 24/7/365 job because, you know, cows and pigs and chickens, they never take the day off. They got to be fed or milked or always cared for and crops always needed tending to every day. The Industrial Revolution gave us the six-day workweek. Sunday was off for religious reasons.
Eventually, that led to the five-day workweek. In 1938, Congress created the 40-hour workweek and set overtime pay for anything more than that. That was then. Now there's a movement to a four-day workweek. Is that affordable? Is it sustainable? Can businesses operate profitably if their employees are only working four days a week?
Well, there's a big study that's been going on in London to try to answer these questions. 61 companies participated in the study, and the four-day workweek proved to be so successful that most of the companies in that study say they're going to stick with it. They're not going back to a five-day workweek. Well, as you'd expect, the workers love it. A third of them say they love it so much that if their boss wanted them to go back to working five days a week, they would demand a 25% pay increase. 8% of them want a 50% pay increase to work a fifth day. And 15% of the workers said there's no amount of money that would ever cause them to go back to working five days a week.
As part of the test, the employers had their staffs work four days a week, but with no cut in pay or benefits. The employees worked 32 hours a week. They didn't work 10 hours a day for four days. They stuck to their eight-hour day. They went from 40 hours to 32 hours at the end of the test. The employees say they got more sleep. They had lower stress. Their personal relationships improved and so did their mental health. The employees say they had more time to take care of their children and grandchildren and parents. Male workers said they doubled the amount of time they spent with caregiving or family responsibilities.
And what about the companies? They said their revenue on average stayed the same and turnover dropped, meaning fewer people quit during the test. People quitting is a huge cost to employers because you've got to spend money hiring and training new people. And while you're doing all that, it's hurting your productivity and profits. So if fewer people quit, that translates into a better deal for the business. Of the 61 companies in the trial, 56 of them said they're going to stick with the four-day workweek. Two are still testing the idea. Only three of them said they're going to go back to a five-day workweek.
Now, I don't think this is going to become standard everywhere anytime soon. A couple of things to point out in this test, two thirds of the companies have only 25 workers or less. This wasn't tried at a big, massive company like a Fortune 500. And these companies were all in the white-collar industry. So these jobs are basically all desk jobs. Two-thirds of the workers, in fact, have a college degree in that test.
So it raises the question, would a four-day workweek work in manufacturing or in retail, healthcare or in the hospitality industry? I guess it would work. You would personally just work four days a week. That means if the business is open seven days a week, you know, like a hotel, I guess that just means the boss has to hire more people. But that means costs are going to rise and that means prices they charge are going to rise. That means sales are going to fall. Profits are going to fall. So is this really a sustainable idea for every industry? And what about workers who would rather work more to earn more? Will they be able to in an environment where everybody is limited to a four-day workweek? There's no question that work/life balance causes the idea to have some appeal. In fact, last year, a bill was introduced in Congress to set the standard workweek at 32 hours, making everything else overtime.
So is this an experiment in London that is just going to remain an experiment in London, or is the four-day workweek coming to you and coming sooner than you think? I'm not sure. All I'm reminded of is Richard Nixon, who once said that the four-day workweek was coming in, "the not-too-distant future". He said that while he was vice president in 1956. Four-day workweek. It might be a part of your future. And it might not. Hey, do you listen or watch the podcast on YouTube? Leave a comment. Tell me what you think. Here’s link to our YouTube channel.