Labour’s four-day-week policy: already working well for companies in New Zealand, Scotland, England and Ireland
John McDonnell, the shadow chancellor, told the Labour conference in September that the party would reduce average full-time hours to 32 a week within a decade “with no loss of pay”. People should “work to live, not live to work”, he said.
The Times cites research by the Centre for Policy Studies, ‘The most influential think tank among Conservative MPs’, which was not revealed on their website. It was said to allege that reducing the hours of public sector employees, including doctors, nurses, teachers, firefighters and police officers, would be costly because the workforce would have to expand.
That is not the experience of 4-day companies in New Zealand, Scotland England and Ireland
The ITV News website covers theory, adding statistics and recording at length the findings of Edinburgh restaurant Aizle, which has enjoyed its best financial year after moving to 4-day working. Its owner says the improvement in staff morale, which has helped to recruit and retain willing workers, has been the biggest positive.
It briefly refers to a New Zealand financial services company initiated the four-day-week and claimed it boosted productivity by 24%. Henley Business School research also mentions Perpetual Guardian, the New Zealand estate management firm, one of the first to go public with a research-backed assessment of its trial, before adopting the policy in November 2018, having found that productivity was unharmed by the shortened working week,
Another company Think Productive in Brighton and Hove switched seven years ago. It changed its five-day week into four extended weekdays and one Friday in four after a three-month trial, but staff are still given the option to work a traditional five-day week: “Most don’t, choosing to lose two commutes and gain the freedom of an extra day to pursue personal and professional interests beyond their primary income”.
Recruitment firm ICE Group this year became the first company in Ireland to adopt a four-day week for all its staff.
Henley Business School research: four-day week pays off for UK business
Henley’s ‘Four better or Four Worse?’ White Paper has gathered opinions from over 250 businesses who currently operate with a four-day working week.
- Two thirds reported improvements in staff productivity.
- The move has already saved implementing businesses an estimated £92 billion annually
- Three quarters of Brits back a four-day working week
- 67% of Gen Z say it would drive them to pick a place to work.
- 64% of those businesses who have already adopted a four-day working week have reported improvements in staff productivity.
- 78% of implementing businesses said staff were happier, 70% less stressed
- 62% took fewer days off ill..
- 63% of employers said that providing a four-day working week has helped them to attract and retain talent.
- 40% of employees said they use the time to upskill or develop professional skills.
- 25% said they use their fifth day to volunteer.
- 34% of business leaders surveyed and 46% of those in larger businesses, say making the switch to a four-day working week will be important for future business success.
The study shows that UK workers are keen for this workplace shakeup, with nearly three quarters (72%) agreeing it’s an attractive proposition and would be a firm driver when picking an employer. This is particularly important for Gen Z – with two thirds (67%) saying it would influence their choice of employment.
The research also added that, despite the financial, environmental and wellbeing advantages, 73% of employers cite concerns around taking up the change, with client and customer servicing and the need to be available, noted as the main barrier for 82% of businesses.
The four-day week also demonstrates a positive impact on the environment, as employees estimate they would drive 557.8 million fewer miles per week on average, leading to fewer transport emissions.
Quartz magazine presents new evidence that working less is good for productivity. In August 2019, Microsoft Japan embarked on a four-day week trial. Every Friday it closed the office and gave roughly 2,300 full-time employees a paid holiday.
According to an article in Sora News 24, there was an enormous jump in productivity. Based on sales per employee, workers were almost 40% more productive than they were the same month a year earlier, while staff stress levels were dramatically improved.
Other productivity hacks (shortcuts, tricks or strategies) were encouraged, including limiting meetings to 30 minutes and suggesting that instead of calling meetings, employees could more fully utilize software available for online collaboration.
Cassie Werber commented yesterday: “Microsoft Japan’s trial is significant because it’s the biggest yet in terms of staff numbers and the apparent effect on productivity. It’s caught the global imagination, perhaps, because Japan’s work culture is seen as particularly punishing. If a big Japanese tech company can change its ways and achieve startlingly better results, perhaps there’s hope for us all”.
The FT reports that senior executives at several of the largest US banks have privately told the Trump administration they feared the prospect of a Labour victory if Britain were forced into new elections.
It then referred to a report by analysts at Morgan Stanley arguing that a Corbyn government would mark the “most significant political shift in the UK” since Margaret Thatcher’s election and may represent a “bigger risk than Brexit” to the British economy. It predicted snap elections next year, arguing that the prospect of a return to the polls “is much more scary from an equity perspective than Brexit”.
Jeremy Corbyn gave ‘a clear response’ to Morgan Stanley in a video (left) published on social media reflecting anti-Wall Street rhetoric from some mainstream politicians in the US and Europe, saying: “These are the same speculators and gamblers who crashed our economy in 2008 . . . could anyone refute the headline claim that bankers are indeed glorified gamblers playing with the fate of our nation?”
He warned global banks that operate out of the City of London that he would indeed be a “threat” to their business if he became prime minister.
He singled out Morgan Stanley, the US investment bank, for particular criticism, arguing that James Gorman, its chief executive, was paying himself a salary of millions of pounds as ordinary British workers are “finding it harder to get by”.
Corbyn blamed the “greed” of the big banks and said the financial crisis they caused had led to a “crisis” in the public services: “because the Tories used the aftermath of the financial crisis to push through unnecessary and deeply damaging austerity”.
The FT points out that donors linked to Morgan Stanley had given £350,000 to the Tory party since 2006 and Philip Hammond, the chancellor, had met the bank four times, most recently in April 2017. The bank also had strong ties to New Labour: “Alistair Darling, a Labour chancellor until 2010, has served on the bank’s board since 2015. Jeremy Heywood, head of Britain’s civil service, was a managing director at Morgan Stanley, including as co-head of UK investment banking, before returning to public service in 2007”.
A step forward?
In a December article the FT pointed out that the UK lacks the kind of community banks or Sparkassen that are the bedrock of small business lending in many other countries adding: “When Labour’s John McDonnell, the shadow chancellor, calls for a network of regional banks, he is calling attention to a real issue”. And an FT reader commented, “The single most important ethos change required is this: publish everyone’s tax returns”:
- In Norway, you can walk into your local library or central council office and see how much tax your boss paid, how much tax your councillor paid, how much tax your politician paid.
- This means major tax avoidance, complex schemes, major offshoring, etc, is almost impossible, because it combines morality and social morals with ethics and taxation.
- We need to minimise this offshoring and tax avoidance; but the people in control of the information media flow, plus the politicians, rely on exactly these methods to increase their cash reserves.
But first give hope to many by electing a truly social democratic party.
Is the rainbow suggesting a new party logo?
Shadow cabinet members refuse to serve in posts Corbyn might well not offer, citing economic policies they clearly haven’t read
So writes MP John McDonnell in the Guardian. Mr McDonnell is author of the superb book, ‘Another World is Possible: a manifesto for 21st century socialism’, a challenge to New Labour that put forward a set of new ideas, principles and policies. He adds:
“As people wake up to the prospect of Jeremy Corbyn actually being able to win the Labour leadership, the reaction has become increasingly hysterical, especially from elements of the Labour establishment”
McDonnell notes that the ‘near panic’ is especially evident in its response to the counterproductive strategy outlined by Corbyn’s team of economic advisers, whose rebukes to Labour supporters have simply made them more determined to work for beneficial change. He continues (summarised):
The vast majority who didn’t cause the economic crisis shouldn’t have to pay for it
“Let me make it absolutely clear that Labour under Jeremy Corbyn is committed to eliminating the deficit and creating an economy in which we live within our means . . . (but) we don’t believe that the vast majority of middle and low-income earners who didn’t cause the economic crisis should have to pay for it through cuts in tax credits, pay freezes, and cuts in essential services.
“We believe we can tackle the deficit by:
- halting the tax cuts to the very rich and to corporations,
- making sure they pay their taxes,
- and by investing in the housing and infrastructure a modern country needs to get people back to work in good jobs.
“We accept that cuts in public spending will help eliminate the deficit, but our cuts won’t be to the middle-and low-income earners and certainly not to the poor.
“Our cuts will be to:
- the subsidies paid to landlords milking the housing benefit system,
- to the £93bn in subsidies to corporations,
- and to employers exploiting workers with low wages and leaving the rest of us to pick up the tab.
“All the factors that caused the 2007-8 crisis are currently reappearing on the scene – frozen or low incomes, low productivity, asset inflation especially in housing, a hands-off government turning a blind eye to loose credit expansion and City speculation, and a growing debt bubble.
“Just like 2007 all it needs is a spark like Northern Rock to set things off again. The rehypothecation taking place in the bond markets could be the trigger this time, when the US starts unwinding its quantitative easing programme”.
Alongside deficit elimination, the Corbyn campaign is advocating a fundamental reform of our economic system
“This will include:
- the introduction of an effective regulatory regime for our banks and financial sector;
- a full-blown Glass-Steagall system to separate day-to-day and investment banking;
- legislation to replace short-term shareholder value with long-term sustainable economic and social responsibilities as the prime objective of companies;
- radical reform of the failed auditing regime; the extension of a wider range of forms of company and enterprise ownership and control including public, co-operative and stakeholder ownership;
- and the introduction of a financial transactions tax to fund the rebalancing of our economy towards production and manufacturing.
“Public ownership does have an important role to play, but this will be through smart forms of 21st-century common ownership and control. For example, rail will be renationalised, but with a form of joint management involving workers and passenger representatives. Energy would be socialised from below by the massive expansion of renewable energy production and supply by local communities, local authorities and co-ops on the successful German model, removing the monopoly of the big six energy companies.
“Politicians have patronised and talked down to us all when it comes to our economy, but ordinary working people have to manage on incomes significantly lower than the likes of George Osborne and his friends in the City. They could teach the bankers and many commentators a thing or two about managing a budget responsibly. Given the opportunity, we will use the sound common sense of our people.