Time to End the Five-Day Work Week?

Most developed-world denizens take the five-day work week as a given. The very idea of questioning it would be as inconceivable as it is fanciful. (Indeed, in our work-obsessed culture, it would likely brand you a lazy bum by coworkers and superiors alike.)

But as Philip Sopher over at The Atlantic points out, even the seven-day length of the week is an arbitrary invention, let alone the far more recent notion that we should have five days to work and only two to rest.  Continue reading

The Countries That Are Working Hard and Hardly Working

Courtesy of Business Insider and Vizual Statistixs is a map displaying which members of the Organisation for Economic Co-Operation and Development (OECD), a club of 34 mostly-developed nations, works the hardest. This is determined by combining the average number of hours worked annually by each person, the average retirement age, and life expectancy. (See a larger version here.)

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So Mexico, South Korea, and Chile are by far the hardest working countries, while France, Germany, and Luxembourg are the least hard-working. The United States is slightly harder working than the median, but definitely more so than its Anglophone cousins and most of Western Europe. Also note that Greece is relatively hardworking by European standards, despite being widely denounced as a nation of laggards following its economic collapse (which certainly had to do with a lot more than average hours worked).

To be sure, this formula that does not take into account other details, such as how hard employees work per hour, but it is nonetheless something to go by. Also, I am not sure if working long hours and having less retirement time is, in and of itself, a good thing. Productivity per hour, the quality of the work, and for more importantly the quality of life in general, should count for a lot more.

Lessons From Ikea on the Merits of Better Pay

While many American employers regard higher wages as anathema to business success, Ikea, the world’s largest furniture retailer, is thriving in the U.S. in large part because of its generous compensation. As HuffPo reported:

Under the system that the ready-to-assemble furniture maker first established in January [2015], the starting wage for any given store in the U.S. reflects the cost of living in that particular area as determined by the MIT Living Wage Calculator, which takes into account the local cost of rent, food, transportation and the like. After the second round of raises, which is slated for this coming January, all of the company’s U.S. stores will be paying at least $10 per hour, and the average minimum wage across all locations will be $11.87 — a 10.3 percent increase over the previous year, according to the company.

Rob Olson, chief financial officer for Ikea U.S., told The Huffington Post that the company is already reaping dividends from its decision to hike the wage floor and to factor in the local cost of living in doing so.

“We’re very pleased so far,” Olson said.

So what types of benefits has Ikea seen?

For one, less turnover. Although it’s only been six months since the raises went into effect, Olson said Ikea is on pace to reduce turnover by 5 percent or better this fiscal year. Holding onto employees longer means the company is spending less on recruiting and training new replacements.

Ikea is also attracting more qualified job seekers to work at its stores, according to Olson. Pay for retail sales workers in the U.S. is generally very low, with an average industry wage of just $12.38 per hour, according to the Bureau of Labor Statistics. But Ikea’s average store wage is heading north of $15. After its living wage announcement [in 2014], the company opened two new locations — one in Merriam, Kansas, and another in Miami — and the higher wages (and attendant publicity) likely helped the company lure more candidates.

“At both of those stores, the applicant pool was fantastic,” Olson said.

The Swedish multinational is seeing the same benefits that just about every company that pays its workers well enjoys: lower turnover (and thus savings from training and recruitment); higher morale and productivity; and the attraction and retainment of talented, quality employees. It should be intuitive that when people are given a stake in a company — through better wages, benefits, and overall treatment — they will feel invested enough to stick around and work hard, thus giving back to their employers. That has always been the logic behind paying executives and higher managers so well, so why shouldn’t it apply to everyone else?

While I am not keen on giving the government too much power, I am not so sure companies are any more rational or knowledgeable about the matter either. Ikea is hardly the first anecdote proving that paying and treating workers better generally results in higher productivity and thus better long-term performance. Indeed, that makes intuitive sense, whatever the empirical evidence, and it is precisely this logic that companies use to justify the high payouts to executives (though rarely to average workers who contributed to said profits as well).

And yet so many companies — the majority in fact — continue to sit on their high profits, or allocate the lion’s share to the top of their corporate structure, all the while bemoaning the high costs of turnover, low productivity, etc. Mere ignorance, short-term thinking, and pressure from greedy shareholders interested only in immediate (and ever-higher and unsustainable) dividends are among the reasons for this problem (to say nothing of a culture that values profits and ruthless commerce at all costs). Being a business does not entail knowing, let alone caring about, the psychological and economical factors involved in corporate policy.

Personally, I am of the view that if the only way you can run your business is to knowingly beggar your employees — for example, paying far less than what can reasonably sustain basic necessities like shelter and healthcare — despite being able to well afford better pay by simply allocating a little less to yourself and your shareholders, then you do not deserve to run a business. I know that is an idealistic and moralizing approach, but why shouldn’t it be, given how integral business policies are (in the aggregate) to societal well-being. If we do not want government calling the shots, than it is contingent on all citizens — especially with the most power and resources — to do what they can to behave ethically and socially responsibly (indeed, this is what libertarians and many conservatives argue: that it is on the private sector, not the public sector, to create a more just and prosperous society).

My short answer: leave it to workers themselves, via unions, co-ops, or other empowering structures, to contribute to the decision-making process of corporate policy. It is hardly a perfect system — what institution is? — but it seems to be the best and most practical alternative to hierarchical and often out-of-touch corporate models, as well as government fiat (which of course is typically no less hierarchical and aloof). Otherwise, we would have to hope that low-wage employers come around to Ikea’s position, especially as it is as much in their interests as those of their workers.
What are your thoughts?

The Plight of Child Care Workers

One would think that someone who dedicates their life to serving some of the world’s most vulnerable people would be entitled to a living wage and great social respect. But as a recent ThinkProgress article highlights, those that care for the nation’s children are among the most poorly paid and economically unstable workers in the country.

According to a new analysis from the Economic Policy Institute, the median wage for child care workers is $10.31. That’s not just a small figure on its own; it’s also very low compared to what these workers could make elsewhere. Even when compared to other workers with the same gender, race, educational attainment, age, geography, and a number of other factors, EPI found that child care providers make 23 percent less. And even those figures are likely underestimating the problem, given that any provider who is self employed and working out of her own home — providers who are likely to earn even less than those in, say, centers — aren’t counted.

“Despite the crucial nature of their work, child care workers’ job quality does not seem to be valued in today’s economy,” the report notes. “They are among the country’s lowest-paid workers, and seldom receive job-based benefits such as health insurance and pensions.”

Adding insult to injury, these low wages mean that many child care workers — more than 95 percent of whom are women, and many of them parents — struggle to afford care for their own children. Barnette has experienced this conundrum herself. While she was able to get a child care subsidy for her two eldest children, her youngest son, who is now five, was put on a waiting list at three months old and only taken off last February, when he got a slot in a pre-K program. In the intervening time, Barnette had to quit her job. “I couldn’t work because I couldn’t afford the child care”, she said.

It’s a widespread problem among a workforce that cares for others’ children. Preschool teachers have to spend between 17 and 66 percent of their income to get care for their own infants; in 32 states and D.C., it eats up a third or more of their earnings.

This is despite the fact that, aside from the obvious importance of their work, the services of childcare workers are in higher demand than ever, owing to the prevalence of dual-income households where both parents must work full-time to get by (as well as the growth in single-parent households wherein the sole guardian must work a lot, too). Continue reading

U.S. Workers Need — and Deserve — a Raise

From the New York Times:

Flat or falling pay is self-reinforcing because it dampens demand and, by extension, economic growth. In the current recovery, median wages have fallen by 3 percent, after adjusting for inflation, while annual economic growth has peaked at around 2.5 percent. At that pace, growth isn’t able to fully repair the damage from the recession that preceded the recovery. The result is a continuation of the pre-recession dynamic where income flows to the top of the economic ladder, while languishing for everyone else …

… In a healthy economy with upward mobility and a thriving middle class, hourly compensation (wages plus benefits) rises in line with labor productivity. But for the vast majority of workers, pay increases have lagged behind productivity in recent decades. Since the early 1970s, median pay has risen by only 8.7 percent, after adjusting for inflation, while productivity has grown by 72 percent. Since 2000, the gap has become even bigger, with pay up only 1.8 percent, despite productivity growth of 22 percent.

Why has worker pay withered? The answer, in large part, is that rising productivity has increasingly boosted corporate profits, executive compensation and shareholder returns rather than worker pay. Chief executives, for example, now make about 300 times more than typical workers, compared with 30 times more in 1980, according to the Economic Policy Institute. Other research shows far greater discrepancies at some companies.

In most companies, there is plenty of money to go around, thanks in no small part to the contributions of hardworking Americans. Isn’t it about time they get their money’s worth? Shouldn’t they, too, get a cut of the profits they helped produce? Or at least a better and more stable working environment?

Why Workers Put Up With A Bad Economy

Given the mounting hardship and misery that has become common in most Americans’ working lives, one cannot help wonder why we have yet to take action — where are the strikes, demonstrations, unionizings, and other forms of pushback?How many more years of income stagnation, inequality, and stress can the majority of workers take? How much more difficult do things need to get?

Continue reading

Reflections On International Workers’ Day

International Workers’ Day, also known as May Day and Labor Day, is a holiday that honors the working classes and the labor movement, and also commemorates the Haymarket affair of 1886, in which workers went on strike for rights like an eight-hour workday and better working conditions (it soon became violent due to police brutality and a fatal bombing of unknown origin — you can read the details of the tragic unfolding of events here).

Despite being a seminal event in the history of the labor movement and the United States as a whole, the Haymarket affair (also known as the Haymarket massacre or riot), is given little attention in school or media. The event was one of several that captured the frustrations and concerns regarding growing inequality, workers’ exploitation, and class tension. It also contributed to the sorts of rights we now take for granted in the workplace, from safer conditions to more reasonable working shifts.

It is telling that while much of the world celebrates, the U.S. forgoes any formal recognition and instead observes “Law Day”, which affirms the importance of law in the foundation of the country, and “Loyalty Day” (formerly “Americanization Day”), which emphasizes patriotism towards American heritage and values. Both these holidays have roots in the First Red Scare of the early 20th century, and formalized in the context of the Second Red Scare that took place during the Eisenhower administration.

The participation of socialists and anarchists in what was a fairly broad-based movement did little to endear the holiday to the American establishment, especially in the context of the Cold War. Even to this day, when one speaks of workers’ rights and the like, it draws suspicion and outright ire, as if only the far-left should or could have an interest in the well-being of the majority of society (especially the vulnerable segment that does some of the toughest, most important, yet most poorly treated work).

Amid reversals in the rights and prospects of workers — from stagnating wages and salaries, to lesser job security — it is little surprise that a global holiday that recognizes the rights and well-being of workers would be overlooked and even subject to fear and contempt. Now more than ever do we need to restore a sense of consciousness and dignity among working people who are underpaid, mistreated, and deprived of opportunities for socioeconomic advancement. The auspicious absence of an American equivalent to May Day — our own Labor Day is celebrated in a different time and context — is both a symptom and cause of hostility and apathy towards the plight of working class people.

But given where the economy is headed, and how many people are getting dragged down with it, how long will that sentiment prevail? How long until we realize that labor rights and the labor movement are of interest to anyone seeking a more just, equitable, and thus thriving society for all? More people enjoying more opportunities, more dignified work, more spending power, which in turns helps businesses and grows jobs.

Of course it is not easy and it will take time and effort, perhaps unprecedented in scale. But it is a worthy endeavor for which we need to get started on as soon as possible, given the time it will take and the number of human lives being immiserated or even lost in the face of poverty and exploitations, both in the U.S. and abroad (it is International Workers’ Day for a reason).

May Day and the associated events and movements it recognized helped precipitate a more prosperous economic system, and within decades produced a culture and environment in which more and more people could share in the fruits of work and commerce, with empowerment in both the commercial and political spheres. Perhaps the second time around we can restore these now beleaguered values and go even further.