Will a four-day work week boost the economy and workforce?

Would a shift to working four days a week benefit the economy, people’s wellbeing, or possibly both? Nina Jörden impartially looks at recent data to suggest it does.

The Covid 19 pandemic has fundamentally changed the way people work and many companies have been forced to adapt to remote or hybrid working models. What was unimaginable for many before the pandemic is now the new normal and common sense. But most people continue to work five days a week. Would a broader shift to four days benefit the economy, people’s wellbeing, or possibly both? Answering these questions will need some solid evidence to inform decisions by businesses and individuals.

Initial experiments around the world show that more work does not necessarily equal better work. With the social change driven by the pandemic, reducing working hours suddenly seems to be a viable option – this shift in thinking has brought the concept of the four-day week into focus.

A four-day week means that employees do 100% of their work in 80% of their contracted hours for 100% of their salary. There are other models, such as compressed working time, where workers work their normal 40-hour week over four days instead of five. However, what we are looking at is the former, a meaningful reduction in working time.

Clearly this implies a need for a jump in productivity to make it sustainable for employers. But the four-day week offers potential benefits on several levels.

At the individual level, a shorter work week can significantly improve health and well-being by allowing more time for rest, exercise and personal activities. Employees can use their extra day off to spend time with family and friends, pursue hobbies or exercise, which improves their mental, emotional and physical wellbeing.

At the organisational level, a four-day work week can lead to better employee retention and a more flexible and diverse workforce. Companies that offer shorter working hours are often seen as progressive and are more attractive to potential employees.

If it is achieved, the necessary increase in productivity is appealing from a company’s point of view. By reducing the number of working days, employees are more likely to feel rested, recharged and motivated. This can lead to better concentration, better quality of work and ultimately higher productivity. In addition, a shorter working week can also help to reduce burnout and stress, thereby positively impacting absenteeism and recruitment costs.

A reduction in working hours requires a rethinking of work processes and methods. For example, employees make better use of available technologies and programmes, finding innovative solutions to make work processes more effective.

On a social level, a shorter work week can contribute to community wellbeing and volunteering. Those with more free time can engage in community activities and volunteering, which can strengthen community cohesion and social ties. The four-day week is also particularly beneficial for people with long-term health problems, childcare or other care responsibilities, and older workers.

Our research to date shows that the four-day week is particularly beneficial for these groups, and leads to them being able to work more and longer. This is both economically beneficial but also contributes to a more inclusive society.

In particular, the issue of staff recruitment and retention was a key motivator for South Cambridgeshire District Council to trial the four-day week; the Bennett Institute is helping to evaluate the outcomes. The Council has faced recruitment problems in a number of services and an increasingly difficult financial environment. In the three quarters to December 2022, the council was able to fill less than 60% of vacancies.

Not being able to fill vacancies – or having to rely on agency staff to fill permanent positions – is both costly and disruptive to services for citizens and businesses. This situation led to the decision to introduce a four-day week on a trial basis.

Although the initial trial period of three months (January to March 2023) was not expected to lead to an improvement in staff retention because it was not certain it would continue, various staff surveys have revealed that some staff have decided to stay with the Council when otherwise they would have left or actively sought alternative employment.

We monitored the trial, which involved about 450 office-based employees. Our performance analyses showed that nine out of 16 Council services improved significantly when comparing the trial period from January to March 2023 and the same period in 2022. The remaining seven areas monitored either remained at a similar level compared to the same period last year or showed a slight decrease. However, it is particularly important to note from a citizen and taxpayer perspective that no performance area declined to a level of concern during the trial. In addition, qualitative interviews with a range of stakeholders, including councillors and managers, revealed that the trial had a positive impact on performance, morale and job satisfaction.

Based on these results, the District Council’s Cabinet decided to extend the trial until March 2024 and also expand it to include the waste service. The waste service was not involved in the first phase of the trial because of the complexity of the changes involved, which affect nearly 130,000 households in the Greater Cambridge area.

We, at Bennett Institute, will continue to monitor the project and work with South Cambridgeshire District Council to understand three things in particular:

1) Does the four-day week have a positive long-term impact on critical recruitment and retention issues?

2) How can the council’s productivity across all services be measured?

3) How exactly can the four-day week add value to the residents of South Cambridgeshire?

The value of such trials, involving external evaluation, is that they can start to provide some of the answers to the broader questions about the four-day week. Some other evaluations have been undertaken, in the UK and US, starting to provide a body of evidence. But the outcomes might differ for different types of organisation or categories of worker, and it is not yet clear that – although the early evaluations are generally positive – that the advantages are sufficient to lead to a much broader switch to a four-day week.