Is a four-day week really an option?

While talk of 15-hour week still seems a tad ambitious, the coronavirus outbreak has brought the idea of the four-day working week back on the agenda once more. A new report by the left-leaning think-tank Autonomy has called for Chancellor Rishi Sunak to drop the present furlough scheme, which is due to end in October, and instead reduce the working week from five days to four, with the Government picking up the tab for the extra day off.

The proposals come at a price though. The think-tank says that if the scheme was only applied to the arts and entertainment sector, which has been hit particularly hard during the lockdown, it would cost £3.8 billion in its first year alone. Adding the retail, food and hospitality industries would increase the bill to £22billion. If the scheme was applied solely to the public sector, it would cost about £9 billion a year, although the think-tank argues that this would also create 500,000 extra jobs.

But it seems hard to see how any government could provide such largesse to specific sectors, without sparking an outcry from other industries which are not included.

Will Stronge, director of research at Autonomy, says: "As the furlough scheme comes to an end and firms across the economy continue to suffer, bold economic strategies are required to support the economy now and forge a recovery process that prioritises secure and decent work.

"Shorter working time has been used throughout history as a way of responding to economic crises as it enables work to be shared more equally across the economy. Instead of propping up an already failing economy, the government could act to save jobs and create more desirable working patterns for the future."

Corin Crane, chief executive of Black Country Chamber of Commerce, says while there is some merit in the idea of a shorter working week in certain industries, a state-subsidised across-the-board four-day working week sounds unrealistic.

"Rishi Sunak is juggling things at the moment, he's trying to continue to support businesses, but he's having to think about how we pay this debt back, and that is not going to be a short-term payback," he says.

"I think the autumn Comprehensive Spending Review will have some more incentives for businesses to keep going, but it also feels that the purse strings are already being drawn.

"We're entering a global recession, so I can't see the money being available for something like that."

Autonomy argues that by paying people the same to work a shorter week, it will give them more time to go shopping and spend their money on their days off, helping to revive the economy. The weakness with that argument is that to fund the scheme the Government would most likely need to raise taxes, effectively giving with one hand and taking away with the other.

The other problem with a four-day week is that while it might provide a short-term fix for mass unemployment resulting from the coronavirus, such a policy could impede the economy in more normal times. Future labour shortages could act as a brake on economic growth, making a long-term recovery more difficult. Short-term unemployment could give way to long-term under-employment, making the country less productive and everybody poorer.

All that said, Mr Crane says some companies are already benefitting from a shorter working week, it just depends on the nature of the work.

"We have had some really good examples of manufacturing companies which have reduced to four days a week," he says.

"It's helped make jobs more attractive to young employees, and companies have been able to cut costs by closing the factory for an extra day.

"But there are other industries where it just doesn't work, where companies can't get the staff they need."

Richard Sheehan, chief executive of Shropshire Chamber, says for some people the four-day week will be a reality one day. But like Mr Crane, he says there are some industries where it just doesn't work and believes that there are other areas the Government should be prioritising.

"In theory it's a nice idea, but in practice it's extremely difficult," he says.

"When it comes to reducing unemployment, there are other ways, the Government should be looking at reducing the costs to business, and the cost of doing business, so that they can invest more in more people and more technology."

There is no doubt that many companies have been able to make a success of a four-day working week, but this has usually been accompanied either by a longer working day, or through job-share schemes where people are paid a pro-rata rate based on the hours they work.

A study by recruitment company Indeed last year found that three-quarters of workers backed a four-day week, and the call has also been backed by some businesses.

This week, in a letter to The Guardian, business leaders David McCann, Matthew Eynon, Richard Lowes and Luke Sartain said their companies had all switched to a four-day week, without any reduction in pay.

"Many of us are still in the early days of making the change, but so far it’s been a huge success," they wrote.

"Every single week, we have achieved our targets, productivity has been boosted and staff are loving their four-day week.

"We’re now calling on the rest of the business community to follow suit and move to a four-day working week. Since the 1980s, UK workers have seen almost no reduction in working hours and, while our productivity lags behind, we work longer hours than most other European countries. As a result, more than two-thirds are stressed or overworked."

There seems little doubt that a shorter working week will become more commonplace in years to come, and advances in technology and increased use of artificial intelligence will have a role to play.

But for it to work effectively, there will first need to be proof that shorter hours can be compensated for by a rise in productivity.

Because while a poll last year found 74 per cent of people supported the idea of a four-day week, this fell to 26 per cent if it meant they would be worse off.

As the old adage goes, there is no such thing as a free lunch.