How a four-day week could boost the economy after coronavirus

The coronavirus pandemic has disrupted work patterns around the world and challenged long-held assumptions about how and where we should work. Employees have proven that they are able to work productively from home, while balancing childcare and other caring responsibilities. Companies have realised that they can save on electricity and rental costs, as well as keep their staff motivated and happy by offering flexible working arrangements.

The past seven months have blurred the lines between our personal and professional lives and reignited the debate about whether a four-day week should be introduced. In a recent nationwide survey, 86 per cent of adults who said they were enjoying spending more quality time with people they live with, indicated that they want this to continue after the pandemic. 

Proponents of the four-day week say it could be a win-win policy for the economy, gender equality and mental wellbeing following the pandemic and help businesses and workers recover from the turmoil this year.

The four-day week has been gaining support steadily in the UK in recent years. The majority of UK workers support the policy, a YouGov poll revealed last year. The Labour Party included a four-day week in its manifesto for the 2019 election and in June a cross-party group of MPs urged chancellor Rishi Sunak to consider the policy following the pandemic, arguing that it could be “a powerful tool to recover from this crisis”.

The letter argues that “shorter hours have been used throughout history as a way of responding to economic crises”. President Franklin Roosevelt cut the working week to 40-hours to save thousands of jobs during the Great Depression in the 1930s. Cutting work hours could help kickstart the economy and reduce unemployment once again, proponents argue.

Researchers at the think tank Autonomy say that switching to a four-day week could help save half a million jobs in the public sector alone. In a recent report, they called for a Shorter Working Week Time Subsidy Scheme, where employees work four days while receiving their full salary. 

Under the scheme, companies would pay 80 per cent of the salaries and government subsidies would cover the remaining 20 per cent. State subsidies would reduce firms’ wages by 20 per cent, prevent layoffs and support industries hard hit by the pandemic, according to the researchers.

It would not be the first time that a four-day week has been implemented to boost the economy. Germany adopted a shorter working week, known as Kurzarbeit, during the financial crisis in 2008 to reduce the number of layoffs. The country’s largest trade union, IG Metall, has proposed introducing a four-day week again to save jobs in the auto industry. The pandemic has put around 300,000 jobs at risk in Germany’s metal and electrical industries, an IG Metall spokesperson said in July.

In the UK, a four-day week could save businesses an estimated £104 billion annually, according to a survey by the Henley Business School of 505 business leaders and more than 2,000 employees. 

Miram Marra, one of the researchers and a finance lecturer at the University of Reading, tells The Independent that having more time off could encourage people to spend more money in shops, restaurants and the entertainment industry. Some 39 per cent of people surveyed by Henley Business School said they would use the extra day off to eat out and 43 per cent said they would go to the cinema or theatre. 

“The surplus of time could reactivate the economy,” says Marra. “The hospitality, arts and tourism sectors could definitely benefit from a four-day week.”

New Zealand Prime Minister Jacinda Ardern suggested in May that a four-day week could help boost domestic tourism. A three-day weekend could encourage people to visit other destinations in their own country and pour money into local businesses, Marra notes. “It could be very positive for the UK as it [tries] to make up for all the lost international tourism.”

It is important that a four-day week is implemented for the right reasons and not simply introduced to cut costs following the pandemic, Andrew Barnes, author of the book The 4 Day Week, says. Barnes switched all 250 employees at his company Perpetual Guardian to a four-day week in 2018. Since then he has noticed a dramatic shift at the financial services firm in New Zealand. The number of sick days has halved and his employees are more productive, he says.

This is what Microsoft Japan found when they trialled a four-day week in 2019. The company reported a 40 per cent increase in productivity among employees when they started having Fridays off. Microsoft said the policy resulted in more efficient meetings and reduced electricity consumption by 23 per cent.

A third of the UK businesses surveyed by Henley Business School reported increased productivity among staff after introducing a four-day week.

According to Barnes, coronavirus presents companies with an opportunity to improve efficiency and find new ways to incentivise staff. “A lot of companies use time as a surrogate for productivity. Covid-19 has made people realise that time in the office doesn’t amount to productivity,” he says.

He argues that transitioning to four days could also help companies attract better talent following the pandemic. “In the world today there is a huge competition for talent. We need people to be creative far more than ever before. Giving [people] downtime gives that opportunity. This is the way for companies to get the best performance out of their employees,” he says.

Luke Sartain, founder of SEO company upUgo in Bristol, can attest to this. He decided to adopt the four-day week last month after time tracking software indicated “an overwhelming drop-off” on Friday afternoon until midday on Monday. “Covid gave us the opportunity to step back, get our ducks in a row and do something positive in the midst of all the negative news,” Sartain says.

Sartain says the decision has paid off, keeping his employees motivated and helping him recruit new staff during this uncertain period. “The biggest thing for me as a business owner is that the quality of the candidates applying and the output of the work has improved. In terms of attracting talent, I’ve never made a better move as a business owner,” he says.

Seventy-two per cent of people surveyed by the Henley Business School said they would consider a job more if they were offered a four-day week and 40 per cent said they would use the extra day to develop their professional skills.

Over three-quarters of businesses said their staff was happier, less stressed (70 per cent) and took fewer sick days (62 per cent) when they worked four days instead of five.

“There is a strong correlation between spending a lot of time in the office and health problems. In the UK about one in four of the workforce suffers from stress or a mental health issue,” says Barnes.

Last year almost 13 million days were lost in the UK due to work-related stress, depression or anxiety, according to analysis by the Health and Safety Executive (HSE), the UK’s health watchdog. And 8.6 million British workers took sick days last year because coming into work was “too painful,” according to research by IT company Insight.

Kelly Swingler introduced the four-day week at her HR consultancy The Chrysalis Crew in 2019 after suffering a burnout in her previous job. She was working as the HR director for a large company in London and says she was always expected to be switched on. “I was answering emails at 6am and 11pm,” she says.

“Many of us wear exhaustion in business like a badge of honour. We don’t always have to be switched on, always working, always doing. It’s not allowing us to be productive and happy,” she says.

The four-day week was the perfect way for Swingler to reward her staff and increase revenue. “Last year we had our most successful year yet and gained most new clients to date,” she says, attributing this result to a more streamlined work process and fewer meetings.

An additional, often overlooked, benefit of a four-day week is gender equality. The traditional five-day system means that many women end up working part-time or giving up their jobs to take up caring responsibilities. Women do an average of 60 per cent more unpaid work, including housework and childcare, than men, according to the Office for National Statistics.

If a four-day week became the norm and employees were offered more flexible working arrangements, it could improve the gender balance in offices and help close the pay gap, according to Barnes. At Perpetual Guardian it is mandatory for all senior executives to work a four-day week. “A lot of men have the chance to be fathers and grandfathers again,” he says.

Making the workplace more accessible to women also brings enormous economic benefits, says Marra. The under-utilisation of women’s skills in the workplace costs the UK economy between 1.3 to 2 per cent of GDP every year, according to research carried out by the Women and Work Commission.

The pandemic has exacerbated gender inequality around the world, revealing society’s reliance on women on the front line and at home. It is the right time for companies to reassess their way of working and set aside more time for family, friends and hobbies, says Barnes. “If Covid has done anything positive, it’s that it has moved the dial and made people start thinking about whether we can do things differently,” he says.