The Guardian view on a four-day week: policies needed to make it a reality

After the first world war, workers wanted a peace dividend for their sacrifices. Within three years they got it. Almost every industrialised nation – with the exception of Japan – accepted the newly established International Labour Organization’s call to limit working hours to eight a day and 48 a week. While most developed countries enacted legislation to achieve these aims, Britain, along with the United States and Italy, did so through collective agreements.

Today, the triple crises of Covid, Russia’s war in Ukraine and Brexit will create job-altering shocks. Employers are already implementing remote working. Some workers, perhaps those with comfortable homes, prefer online messaging to water cooler chats and web conference calls to in-person ones. Others, meanwhile, are opting out of work altogether. From Monday, thousands of workers in 70 UK companies will be paid the same wages for a four-day working week as a five-day one. Like an eight-hour day in 1919, workers are demanding changes once regarded as fringe, eccentric ideas.

There are good arguments for a four-day week. Studies suggest improvements in workers’ happiness and improvements in productivity. The UK has for too long fostered a working culture that encourages long hours and employee exhaustion. About 10 million people – almost one in three people in work – would work fewer hours if they could. Remarkably, 3 million of them would take fewer hours even with a loss in pay.

Having to work less hard for a desired income is obviously welcome. But such a desirable outcome is complicated by factors such as the pressure to consume, security of employment and inequalities of power and income. Given the prevalence of in-work poverty, and with inflation hitting those on lowest incomes the hardest, many British workers cannot afford to cut their hours.

In 2019, the economist Lord Skidelsky considered the problem in detail for the Labour party. His report compared how European countries had managed to make employment more compatible with wellbeing. He noted, with approval, how collective bargaining in Germany had seen workers receive real wage increases and reductions in working hours in return for improved productivity. He rejected a French-style legislated national limit, noting that it broke down within a few years.

The peer’s insight was that the economic security and rights of UK workers had to be improved so that they were in “a position to decrease their working hours voluntarily should they wish to”. In the modern age, it is clear that the market cannot provide continuous full employment. That is why Lord Skidelsky advocated for a new role for the government as an “employer of last resort”, by guaranteeing jobs paying the living wage to the unemployed who cannot find work in the private sector.

By providing an alternative to the market, argued the peer, the state would gain a powerful lever to push down the average number of hours worked. Lord Skidelsky thought that a 35-hour working week in the public sector over 10 years was achievable with the right policies. Britain’s experience a century ago is worth recalling. The loss in output from cutting working time was largely offset by increased hourly productivity. The shorter day led to the growth of leisure and consumer industries. Currently, the financial logic that governs the rules of employment is inimical to reducing workloads. What is needed are countervailing institutions to push society in the technologically possible direction desired by most people.

Universal Man: The Seven Lives of John Maynard Keynes review – more than the sum of its parts

Review of Universal Man: The Seven Lives of John Maynard Keynes
by Richard Davenport-Hines

Splitting a biography of the influential economist into parts pays dividends

I admit I came to Universal Man: The Seven Lives of John Maynard Keynes with a certain prejudice. I knew Richard Davenport-Hines as an accomplished writer and biographer. But he has no background in economics. How could he write a successful life of the most fascinating and influential economist of the 20th century, the economist who gave governments the tools to fight slumps? (Not that they always use them!)

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Cameron is right to warn of another recession, but wrong to blame the world

Ministers are up to their old game of blaming everyone but themselves for Britain’s economic woes. First, they said they were “clearing up the mess” left by Labour. When recovery stalled in 2010, it was because of the Greek crisis. Now David Cameron warns of a new recession even before it has happened– because Europe is not doing its job of recovering properly.

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Labour must expose the fallacy of George Osborne’s ‘recovery’

Where has the conference silly season left the debate on economic policy? George Osborne claims to have routed his critics: fiscal austerity has produced recovery. Labour, seemingly amazed that recovery has happened, has promised that a Labour government will continue to cut the deficit, albeit a little more slowly. The Liberal Democrats would join them in the slower lane. The main point of difference seems to be that “Labour cuts” will be fairer than “Tory cuts”.

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Labour should hammer home one simple message on the economy

The Labour party faces a political dilemma. Barely a day goes past without the more excitable parts of the British press trumpeting some new signal of Britain’s economic success. Every other headline screams that Britain is “booming” or that its factories are “roaring to life”. Every little jump in the flimsiest of economic indicators, every upward revision of economic forecasts, is celebrated as if it were a triumph worthy of song. And the propaganda seems to be working: voters’ confidence in Conservative economic management has soared, and in Labour’s has slumped.

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High-speed rail could set Britain – and Europe – on the path to recovery

The chancellor’s fiscal policy has been a disaster – a growth-first strategy driven by a bond-funded HS2 could be the answer

When George Osborne took over the Treasury, he decided that fiscal policy would be governed not by the state of the real economy but by the state of the public finances, as measured by pre-set fiscal targets, particularly the rate of deficit reduction. Those targets were designed to reassure investors in government debt that the state was solvent and would remain so.

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Dear George… Advice to George Osborne

Dear George,

Cutting public spending when there is no other source of growth in the economy is a sure-fire strategy for recession. As if the lack of recovery wasn’t bad enough, the lack of growth also scuppers your deficit-reduction goals – the very reason for austerity in the first place. Like throwing away the engine to trim a car, you have offset the lack of revenue recovery by slashing capital spending. The results are already being seen in the forecasts: there will be no spurt of growth to regain the losses of the recession. The best we can hope for is a slow crawl along the bottom.

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Let’s abolish retirement

Retirement is not as old as you think. According to the Bible, God expelled Adam from Paradise with the terrible words: “In the sweat of thy face shalt thou eat bread, till thou return unto the ground.” And that’s more or less how it was until about a hundred years ago. Most people worked till they died. Pensions in the UK date from 1908, and the cost of the first pension schemes was tiny, as the retirement age of 70 was 20 years beyond average life expectancy. Retirement was for heaven – if one had lived a virtuous life.

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