Reducing working hours to improve productivity sounds counterintuitive, and yet, it is becoming a leading trend in European economies. Countless studies have demonstrated the benefits employees feel when their hours are reduced, but for companies the switch from a five- to a four-day week is a complicated decision.

Coming out of the pandemic, more emphasis has been placed on work-life balance, which highlighted the UK’s existing crisis of productivity[1]. 36.8 million working days were lost in 2021/22 because of work-related illness and injury – with the most common cause of sick leave being heavy workload[2]. An abbreviated work week could potentially solve this problem. But this heavily relies on effective implementation.

A shortened week is based on the 100:80:100 model – 100% of salary for 80% of the time worked, whilst committing to maintain 100% productivity[3]. For businesses, the success of the four-day work week comes down to one question: will it generate enough productivity to offset the increased cost of labour?

Why introduce it?

There are three key reasons why a four-day week makes sense for businesses.

1) Increased Productivity:

Overworked employees are inherently less productive than employees working an average number of hours. For example, some of the world’s most productive countries – Norway, Denmark, Germany and the Netherlands – average 27 hours a week of work, whereas Mexico and Korea which average over 40 hours are far less productive[4]. In a trial of 61 companies (across all sectors) piloting the four-day work week, 55% of employees felt an increased ability to work, and 71% reported feeling less burnt out – meaning they could work more efficiently⁵. This resulted in company revenue increasing by 1.4% over the 6-month trial period⁵.

2) Employee Retention:

Employee well-being is significantly improved when their week is shortened. Reducing work hours resulted in 54% of employees finding work-life balance easier and 46% feeling less fatigued[5]. This led to a 57% reduction in staff leaving participating companies, and 15% of employees saying that no amount of money would persuade them to return to a five-day week⁵. Commitment to well-being meant employees felt valued by their employer, and clearly shapes employee retention⁵.

3) Competitive Advantage:

In some cases, the four-day week acts as a form of competitive edge – especially regarding recruitment. Senior managers reported significant difficulties in recruiting after the pandemic because homeworking had become so popular⁵. Offering a four-day work week helps companies seem more attractive in the post-pandemic market. This is especially important in lower revenue businesses who want to attract top level candidates without having to offer significantly higher salaries⁵. Managers acknowledged that being at the forefront of work structure changes could be beneficial to their reputation, recruitment and retention⁵.

How should it be implemented?

It doesn’t have to be ‘one size fits all’

Contrary to popular opinion, the four-day week doesn’t necessarily have to follow the classic ‘Friday off’ model. Other models include staggered (staff take alternative days off), decentralised (different departments have different days off), annualised (staff work an average of 32 hours, but this is calculated on a yearly scale) and conditional (entitlement to the four-day week is based on on-going performance)⁵. This means working hours can be tailored depending on industry, work culture, and demand.

Leadership:

The shift from the five-day to the four-day week asks a lot from a company leader. Rejecting traditional work models can be a risky move, but leaders must understand their crucial role in the change[6]. Trust in your employees is key.

Leaders must be able to trust that their employees will not only increase productivity but maintain this change in the long run. This is not to say managers should rely on pure faith in their staff – practical measures to increase productivity should be taken. Methods including shortening meetings by having clear agendas and objectives, introducing focus periods, automating certain aspects of work, creating target lists before leaving work and eliminating time-wasting were all cited by organizations as successful in increasing productivity⁵.

What are the potential problems?

So, if the four-day work week seems so beneficial, why are some companies hesitant to implement it? It comes back to the question: is productivity increased enough in the four-day work week to make it worth it? Some companies have found that it is not.

First, it is not always possible to increase productivity enough to off-set the number of working hours you have cut. For every working hour you remove, you need a 3.1% increase in productivity during the hours still being worked, in order to break even[7]. Cutting a 40-hour week to 32 hours – you would need a 24.8% increase in productivity. But in some sectors – where you may be cutting from a 50-hour work week – you would require a 55.8% increase⁶. This would simply not be feasible.

Second, companies risk financially burdening themselves with the increased cost of labour if businesses do not see the increased productivity they need:  the additional costs of paying additional staff to fill the productivity gap could see them operating at a loss⁶. This, combined with staffing challenges and a troubling economic climate, could be lethal to a company – particularly in the first few months of implementation³.

Finally, the four-day week places a microscope on a company’s hires. Essentially, that boils down to the personality of your employees. The theory that reducing working hours boosts productivity heavily relies on employees being trusted to consistently match the output of a five-day work week, whilst only working four³. Reducing work hours requires the right workplace culture, which some companies may find they lack.

Similarly to the shift from a six-day week to a five-day week – first introduced by Henry Ford in 1914 – the change to a four-day week will take time to become standard practice[8]. The change requires thoughtful hiring, creative leadership, and good workplace culture. Companies that can achieve this will increase their competitive advantage in the market and maximise their productivity gains and employee well-being, whilst minimizing rise in labour costs[9].

For further information regarding this article or a broader conversation around the search market. Please contact Emily Davies ed@drydensearch.com

References:

1. Ashford, N.A and Kallis, G (2014) ‘A Four-day WorkWeek: A Policy for Improving Employment and Environmental Conditions in Europe,’ Global Economy, pp. 53-58 , Available at: https://www.researchgate.net/publication/279835239_A_Four-day_Workweek_a_Policy_for_Improving_Employment_and_Environmental_Conditions_in_Europe
2. Health and Safety Executive (2022) ‘Working days lost in Great Britain,’ Health and Safety Executive. Available at: https://www.hse.gov.uk/statistics/dayslost.htm  [Accessed 14/03/23]
3. Mosaic Executive Search (ND) ‘The 4 day working week – will this work in practice?’ Mosaic Executive Search, Available at: https://www.mosaic-search.co.uk/insights/4-day-working-week-will-this-ever-work-in-practice/ [Accessed 13/03/23]
4. Johnson, D. (2017) ‘These Are the Most Productive Countries in the World,’ Time, 4^th January. Available at: https://time.com/4621185/worker-productivity-countries/ [Accessed: 14/03/23]
5. 4 Day Week Global (2023) ‘The Results Are In: The UK’s Four-Day Week Pilot,’ Autonomy, pp 1-69. Available at: https://www.4dayweek.com/uk-full-report-2023
6. Hancock, L. (2021) ‘Towards a Four-Day Workweek: The Rise and Resistance,’ Organizational Performance Group, 30^th March.Available at: https://organizationalperformancegroup.com/publications/towards-a-four-day-workweek-the-rise-and-resistance/ [Accessed 10/03/23]
7. Shepherd, J and Bhattacharya, A (2021) ‘A question of time: current working hours, preferences, and the case for a four-day week,’ Social Market Foundation, pp. 1-22. Available at: https://www.smf.co.uk/wp-content/uploads/2021/07/A-question-of-time-July-2021.pdf
8. Ellerbeck, S (2023) ‘The world’s biggest trial of the four-day work week has come to an end, These are the results,’ World Economic Forum, 10^th March. Available at: https://www.weforum.org/agenda/2023/03/four-day-work-week-uk-trial/ [Accessed 12/03/23]
9. Laker, B and Roulet, T (2019) ‘Will the 4-Day Workweek Take Hold in Europe’ Harvard Business Review, 5^th August, pp. 1-6. Available at: https://www.researchgate.net/publication/337340662_Will_the_4-Day_Workweek_Take_Hold_in_Europe [Accessed 11/03/23]
   

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[1] Ashford, N.A and Kallis, G (2014)
[2] Health and Safety Executive (2022)
[3] Mosaic Executive Search (ND)
[4] Johnson (2017)
[5] 4 Day Week Global (2023)
[6] Hancock, L. (2021)
[7] Shepherd, J and Bhattacharya, A (2021)
[8] Ellerbeck, S (2023), S (2023)
[9] Laker, B and Roulet, T (2019)