Are Europeans working less, not by choice?
You don't fool me! Those lazy bastards, sipping coffee at street-side cafes.
Seriously, this is pretty strong evidence that more socialistic economic policies and reliance on Russian energy work. God, I crack myself up.
Europeans Are Working Even Less, and Not by Choice
Their average workweek has declined since the pandemic, while in the U.S. it has grown; trimmed hours and furloughs frustrate workers
By Tom Fairless, WSJ
July 15, 2022 8:57 am ET
European workers have put in fewer hours than Americans for decades. Now, they are working even less than before the pandemic—almost one day a week less than Americans in 2021, according to data for the five biggest European Union economies.
Since the start of the pandemic, Americans have increased their working hours by about 1%, on average, while Europeans have trimmed theirs by around 2%, according to data about the five large EU economies from the Organization for Economic Cooperation and Development.
That is partly because many European companies tried to avoid pandemic-related layoffs by reducing workers’ hours. Nearly two million Europeans still are in Covid-19 furlough programs, with governments, for now, covering a portion of their lost pay. The U.S. economy recovered more quickly, and many American workers who kept their jobs or found new ones have continued to work the same or longer hours.
Europe has long had a reputation in the U.S. for less demanding work hours and more generous vacation practices, which many Americans attributed to a different approach to work-life balance. The pandemic labor picture shows that the differences aren’t strictly voluntary.
For some Europeans, especially in the wealthier North, swapping work for leisure time is a choice. For others, notably in the South, it isn’t. People either can’t find full-time jobs or have stayed with weakened companies that trimmed their hours during the pandemic to save on wages.
Across Europe, more than one-third of part-time work is involuntary, according to a December report by the OECD. More than half of part-time workers in Italy, Spain and Greece, and nearly one-third in France, want to work longer hours but can’t, according to data from the European Union’s statistics agency.
The percentage of involuntary part-time work in southern Europe has surged over the past 15 years, amplified by successive economic crises. About 10% of Italy’s labor force works part time because they can’t find full-time jobs, compared with 0.6% in the U.S. In Germany, close to one-quarter of workers work fewer than 30 hours a week, but that is predominantly by choice, the data show.
The unemployment rate across the eurozone is at a record low of 6.6%. Nevertheless, working less can have negative consequences for the broader economy. If the average worker puts in fewer hours, it can reduce economic output, suppress wages and undermine consumer spending.
In recent months, labor shortages have broken out in parts of Europe. The public-employment service in the Wallonia region of Belgium recently published a list of dozens of jobs where workers were in short supply, including information-technology specialists, nurses and welders.
Some senior European officials, business leaders and economists say that if Europeans worked more, it would boost the region’s growth rate, help finance public spending and plug gaps in the labor market as the region’s population ages.
During his re-election campaign, President Emmanuel Macron called on the French to work more. “When we compare ourselves, we are a country that works less than the others, that remains true,” he said in October. “We have a strength, which is our social and educational model, and a weakness is that we no longer have the productive model which makes it possible to finance it.”
German Finance Minister Christian Lindner said late last month that Germans could support their nation’s fragile economy during the Ukraine war by working longer hours. “We are in a fragile situation,” he wrote on Twitter. “What we need now is more growth impetus, more startups, more overtime hours to ensure our prosperity.”
Europe’s employment rate—the share of the working-age population with jobs—has risen above its prepandemic level, while the U.S. rate is still below that level. But each European employee is working less.
French President Emmanuel Macron, center, has called on the French to work more.
PHOTO: SAMEER AL-DOUMY/AGENCE FRANCE-PRESSE/GETTY IMAGES
The average American worker put in 34½ hours a week last year, a figure that has barely changed over the past two decades, according to OECD data that includes full-time and part-time workers.
The average European workweek is several hours shorter than it was 20 years ago. In Germany, the average workweek shrank to 25.9 hours in 2021, from 28 hours in 2001, the OECD data show. In Italy, it declined from 35.6 hours to 32.1 hours over the same period, and In France, from 29.6 hours to 28.7 hours.
In the decades after World War II, Europeans worked longer hours than North Americans as the continent caught up economically. But since the 1980s, the average European has worked less and less, while average working hours stabilized in the U.S.
Working hours for the average Italian declined by about 8% between 2007 and 2021, and per capita economic output shrank by the same amount. In the U.S., the average workweek stayed about the same during that period, and output per capita increased by 13%, adjusted for inflation.
Eurozone wages are now rising by around 2.8% a year, far below the inflation rate of 8.6%, according to the European Central Bank. In the U.S., by contrast, annual wage growth increased to 6.7% in June, the fastest pace in at least 25 years, according to the Federal Reserve Bank of Atlanta.
German Finance Minister Christian Lindner has said Germans could support their economy during the Ukraine war by working longer hours.
PHOTO: CLEMENS BILAN/EPA/SHUTTERSTOCK
While some politicians and economists argue that shorter hours can increase productivity, reductions in working hours in several European countries between 1995 and 2007 had no significant effect on hourly labor productivity or job creation, according to a recent study by economists, including the OECD’s Andrea Garnero.
TeamSystem SpA, an Italian software company, gave its roughly 2,800 employees a new choice last year: Work the same 40 hours a week for the same pay, or work 36 hours for 10% less (except for the lowest-paid 20%, who would continue drawing the same salary).
About 40% of employees opted to shorten their workweeks and generally take Friday afternoon off, said Donatella Isaia, the company’s chief people and culture officer. The company, which makes accounting software, hopes that the changes will improve employees’ work-life balance while increasing their productivity, she said.
Some European governments, including Germany’s, have made up for shorter workweeks by expanding the workforce, adding more older workers and women, often in part-time jobs. That strategy, though, is reaching its limits in many places, with shortages of workers emerging in some sectors.
In Germany, where there were about 1.7 million job vacancies in the three months through March, around half of businesses say labor shortages are hampering their operations. In the Netherlands, a government advisory body recently called for longer working hours in the public sector to avoid staff shortages.
“I personally have great sympathy for an optional increase in weekly working hours, of course with full wage compensation,” said Siegfried Russwurm, president of the Federation of German Industries, a trade group.
Germany is facing the loss of millions of workers as baby boomers retire. Mr. Russwurm said it would be easier to make up for that labor shortfall through longer workweeks than by raising the age at which Germans can begin claiming their state pensions, currently 65 years and 11 months.
Some European companies, though, need to trim their labor costs because of falling demand.
Germany’s large auto suppliers agreed with employees during the crisis to preserve jobs for several years in return for shorter working hours. Roughly 60,000 employees of Germany’s state-owned savings banks recently agreed to a 3% wage increase and a reduction of the workweek by one hour, to 38 hours.
A worker at Spanish retailer Desigual voting last year on a plan to reduce the workweek.
PHOTO: JOSEP LAGO/AGENCE FRANCE-PRESSE/GETTY IMAGES
Last fall, Desigual, a Spanish retailer with about 2,700 employees, reduced the workweek for around 500 staffers in its Barcelona headquarters to 34 hours, from 39.5, after revenue declined. It cut pay for those workers by 6.5%, although their hourly pay will rise because they will work 14% fewer hours. Chief Executive Alberto Ojinaga said the move was supported by a majority of employees and was intended to improve their work-life balance.
Valentina Bazzarin, a psychologist in Bologna, Italy, was unable to find a permanent job after receiving her Ph.D. in 2009. For nine years, her contract to teach at the University of Bologna was renewed every year, interspersed by two- to three-month periods of no pay. She left the university in 2018 to work as a freelance teacher and consultant. Her partner is working roughly half his normal hours after his client cut them.
During the pandemic, Ms. Bazzarin’s average workweek shrank to about 15 to 20 hours as teaching and consulting contracts dried up. That ate into her normal annual income of about €30,000 a year.
Valentina Bazzarin, a psychologist in Bologna, Italy, has had trouble finding full-time work.
PHOTO: DAMIANO SABUZ
Ms. Bazzarin, 42, and her partner have decided against having children. “We can’t give them a decent future. The economy isn’t strong enough,” she said. “Uncertainty is the main characteristic of this life.”
More than one-third of the 3.3 million jobs created in Italy in the first half of 2021 were part-time, usually defined as fewer than 30 hours a week, mostly because of cost cutting by companies rather than workers’ choice, according to Italy’s National Institute for Public Policy Analysis. Across Italy, about 2% of workers were on furlough in December, according to the latest data from the OECD.
Union leader Marco Lomio, who represents employees at car maker Stellantis’s factory in Melfi, Italy, said workers have had to stay at home for three days a week, on average, since the start of the pandemic, partly because of production halts. Italy’s job-furlough program has covered 80% of their lost hourly wages. Many workers, he said, would like to work more.
In Germany, almost half a million workers—and about 4% of auto workers—are on furlough.
Governments in Austria, France, Germany and Spain recently extended their emergency furlough program, partly to cushion the economic blow from the war in Ukraine.
Workers at car maker Stellantis’s factory in Melfi, Italy, have had to stay at home for three days a week, on average, since the start of the pandemic.
PHOTO: ALESSANDRO GAROFALO/LAPRESSE/ZUMA PRESS
Patrick Kämmerling da Silva, a commercial painter and varnisher in Germany, was furloughed at the start of the pandemic. He didn’t work at all for almost two years, and in recent months worked one-quarter of his former hours. The government paid him 87% of his normal salary for the lost hours, but rising prices made it tougher to make ends meet, he said.
Mr. Kämmerling da Silva, 38, said he mostly stayed home. “Everything is becoming more expensive,” he said. “Hobbies cost money. It’s either a hobby or food for the family.”
Ralph Ebben, who builds stands at German trade fairs, said his employees had been working about 30% of their normal hours.
PHOTO: RALPH EBBEN
His employer, Ralph Ebben, builds stands at German trade fairs, an industry that was slammed when international travel seized up. Mr. Ebben said his employees had been working about 30% of their normal hours. His workforce has shrunk as employees grew tired of being on furlough, he said, which has compromised his company’s ability to get some new work.
Two weeks ago, Mr. Kämmerling da Silva started working full time again after the German government extended but tightened the terms of its furlough program. Mr. Ebben said his workload had increased recently, but that he worried work would soon dry up again.
In Europe, most workers enjoy strong protections from dismissal, which deters companies from hiring and means workers switch jobs less frequently than in the U.S., even when their hours are reduced.
Retraining for new occupations in Europe is cumbersome and costly. To become an elder-care worker in Germany, for example, requires an apprenticeship of two to three years, with thousands of hours of classroom study. Qualifying to become a baker, plumber or painter takes several years.
Ms. Bazzarin said her Italian Ph.D. in psychology allows her to practice as a clinical psychologist in the U.S., but not in her home country. To practice in Italy, she said, she would also need a master’s degree in clinical psychology. In the U.S., where she worked between 2010 and 2012, her Ph.D. allowed her to practice after only a few days of training.
In Italy, she said, “you can’t plan, and you have to be aware of thousands of rules—stupid rules and contradictory rules.”
Write to Tom Fairless at email@example.com