Why Didn’t Technology Create a 4-Hour Workday?

Technology is supposed to make our lives easier over time, but what is the reality? We may not spend all day hunting and gathering anymore, but we still work similar hours to our great-grandparents. From the paper A Century of Work and Leisure [pdf] published in the American Economic Journal:

We find that hours of work for prime age individuals are essentially unchanged, with the rise in women’s hours fully compensating for the decline in men’s hours. [...] Overall, per capita leisure and average annual lifetime leisure increased by only four or five hours per week during the last 100 years.

The following video by CGP Grey called Humans Need Not Apply methodically describes how robotic automation will soon make an additional chunk of people unemployable.

Horses aren’t unemployed now because they got lazy as a species, they’re unemployable. There’s little work a horse can do that do that pays for its housing and hay. And many bright, perfectly capable humans will find themselves the new horse: unemployable through no fault of their own.

If robots are doing all the work, shouldn’t that mean that the workers should be able to get by working less? Some people thought so. The famous economist John Maynard Keynes wrote in 1930 that “by 2030 he expected a system of almost total “technological unemployment” in which we’d need to work as few as 15 hours a week, and that mostly just to avoid losing our minds from all the leisure.”

That is taken from the Vice.com article Who Stole the 4-Hour Workday? (warning: other parts of this site may be considered NSFW), which discusses how the dream of a shortened workweek fell apart:

A new American dream has gradually replaced the old one. Instead of leisure, or thrift, consumption has become a patriotic duty. Corporations can justify anything—from environmental destruction to prison construction—for the sake of inventing more work to do. A liberal arts education, originally meant to prepare people to use their free time wisely, has been repackaged as an expensive and inefficient job-training program. We have stopped imagining, as Keynes thought it so reasonable to do, that our grandchildren might have it easier than ourselves. We hope that they’ll have jobs, maybe even jobs that they like.

The new dream of overwork has taken hold with remarkable tenacity. Hardly anyone talks about expecting or even deserving shorter workdays anymore; the best we can hope for is the perfect job, one that also happens to be our passion. In the dogged, lonely pursuit of it, we don’t bother organizing with our co-workers. We’re made to think so badly of ourselves as to assume that if we had more free time, we’d squander it.

The Vice.com article focuses on the idea that workers should organize and fight for their share of the benefits.

Instead, we see that the benefits of any technological advancement or increase in productivity has predominantly gone to the owning class (business owners, content owners, and corporate executives) as opposed to the working class. A thick, NYT bestselling economics book posits that when the rate of return on capital is greater than the rate of economic growth, the result is wealth inequality.

I certainly don’t know how this will play out. Will robots cause mass unemployment? Will we all have 20-hour workweeks with no pay cut? In the meantime, as an individual its seems wise to keep converting my excess work energy into ownership of assets. If all you do is work, get paid, and spend it all, then you may be stuck in the rat race indefinitely. A way out is to save a portion and buy some assets. Businesses, real estate, shares of common stocks. Or start your own business and/or create some assets.

Comments

  1. I think people who use technology in their jobs, and therefore have increased productivity through advancements in technology, probably do work less, but they are still at their workplace at least 8 hours a day because there is a cultural and professional expectation that they be present. So perhaps we do have more leisure, it just isn’t at home.

    • I agree with Andy. And this is not a new phenomenon. There is a movie called “Office Space”, which is more than a decade old. It proves what Andy just said. To quote the main character, he said something like “On a typical 8-hour day, I do about 15 minutes of actual real work.” It is a comedy, so things are exaggerated a bit, but there is some truth in it. I highly recommend the movie.

  2. The best advice is to spend your time buying appreciating assets, not depreciating assets and toys.

  3. I like the intersection of economics, with business, and pursuit of FI. I have to carve out some time to read that paper now. I am 100% with you on getting assets that produce income for you, rather than you converting your human capital into money. The thing to consider of course is whether those assets will be impacted by changes in technology. If you are owning a textile mill, where you would need to constantly reinvest all profit back into the business to keep up with other competitors, then likely you are squandering your capital.

  4. Office Space is one of my all time favorite movies! I recently stopped working full-time in an office and instead work for a couple different clients from home. I’ve found that I accomplish the same amount in about 1/3 the time simply because I don’t have all the distractions of the office.

    Jonathon, your ending point is excellent. Most of society converts their disposable income into consumption, rather than using it to buy or develop assets. Unfortunately, the main “asset” for many people is their home, which is really more of an expense unless you happen to live in a growing area.

  5. Not to get all Marxist about it, but I figure this is kind of expected given that those in possession of new technologies (means of production) are not the workers.

    From the perspective of a company, sure you could split a 40 hr/week job to three people at 15 hrs/week each, thus reducing hours and decreasing unemployment, but why? You’d increase overhead by needing those three people to sync up (context switching is very expensive), have to pay for benefits of all three (assuming this is the new norm of for companies), have to come up with promotion tracks, reviews, etc. But if there are workers out there who are interested in working a 40 hour week instead, then why not hire them? There’s no incentive for an employer to do this!

    Flip side, workers don’t have any leverage to demand higher wages and fewer hours from employers. Unions or other worker collectives are the few niches where these sorts of things sometimes happen, but in general most people are out there in the economy on their own. Individuals who are just happy to have a job. So there’s not much impetus coming in from the worker front either.

    Maybe if all the technology in the world was collectively owned we could come up with a system to do this, but in the real world, I’m not expecting any sort of human gains for workers any time soon.

  6. Joshua Katt says:

    That is a great movie!

    Consider that technology has pushed a lot of grunt work (i.e data entry, looking up of information, shopping) from Corporations to us individuals. Take the airlines before the web, huge call centers and travel agents needed to exist in order to book 100% of flights and print out physical tickets. At least 90% of that expense (including commissions) has been eliminated, the clerical burdens passed to us and we may have to even pay extra for doing it the old fashion way, Savings passed along to us? I highly doubt it since airfares are not logically priced by some metric such as distance flown. $300 coast to coast but $1000 for an hour’s flight when they can get away with it.

    Another simple way to look at it is this – As late as the 70′s, it was largely traditional for one family member to work, the other stay home and raise kids and live a decent life. Without widespread technology, the Nation’s work got done and the economy prospered. Then “technology” explodes supposedly creating “efficiencies”, but now everybody has to work, doubling the size of the workforce just to keep up and afford what was easily obtainable by 1 in the past. I don’t have the reasons but WTF, isn’t some thing wrong?

  7. The problem is the oversupply of hours people are willing to offer for work which drives the hourly rates down. Especially now when both men and women work. Even if you produce $1000 per hour, an employer won’t pay you more than they have to.

    Government can create a wage floor though let’s say at $15 which while placing business whose worker produce less than $15 our of business – will make businesses cough up more money in those businesses where the workers are more productive. (Or shorten the workweek while increasing wages and investing in technological solutions)

    At the same time a household that works 100 hours per week can outbid when it comes to purchasing a house a household that puts 80 hours a week if the wages are the same. So there is pressure for workers to work more to gain purchasing power if they can’t negotiate a higher wage.

  8. Great conclusion
    Just join the “owning class” and benefit.

  9. Jonathan, I’m sure you know as well as anyone that you can work a lot less if you make do with a lot less. If society had channeled all our technology advancements into fewer hours at work rather than things like information and communication technology, transportation advancements, increased life expectancy, etc., we could be spending a lot more time at home with all the luxuries the 1930′s had to offer.

  10. Jonathan, one of the best posts I’ve read on your site, and I’ve been reading for years. Dovetails nicely with some of the recent coverage of the upcoming acceleration of job elimination due to advances in automation/robotics. Lots of food for though as it relates to career guidance for my two young daughters.

  11. One key thing that I haven’t seem mentioned is that it takes workers to design, manufacture, test, troubleshoot, maintain, train, and sell all this technology, equipment, and machinery that is going to put us all out of work!

  12. Billy Zhao says:

    It is also logically concluded that human race will at some point diminish and wipe out, like any mater in universe, it will die out. We in general just ignore it and move on our daily life.

    The robotic revolution will do the same. There’s no need to dread about it unless you have a solution.

  13. I’m surprised this wasn’t reconciled with early retirement — technology HAS created the 4-hour workday, it’s just that you typically need do all the work up front, and if there was smart planning, you can retire decades early!

    “And many bright, perfectly capable humans will find themselves the new horse: unemployable through no fault of their own.” What a ridiculous statement! The world is always changing — humans are much smarter than horses and so if they let themselves become unemployable, especially the bright ones, they need to take responsibility.

    Great blog, btw! This was actually the first finance blog I ever stumbled upon several years ago and it planted some great seeds.

  14. Mark Adams says:

    Lots of Luddism in this post and in this thread. Agriculture once employed 70% of all Americans back in the 1850′s. Today, that industry employs less than 5% of Americans, and yet our unemployment rate is exactly the same as it was back then even though the country’s population has exploded since then. Similarly, manufacturing once employed 40% of all Americans in the 1940′s. Today, that industry employs less than 10% of Americans, and yet our unemployment rate is again about the same as it was then even though population has grown incredibly since then. How can this be? How did millions of jobs become lost in both of these industries, while population has grown by hundreds of millions, and yet most people have work? The answer is that the economy accommodated these changes. When wages begin to fall due to a glut of workers expelled due to automation, it becomes more practical for new businesses and industries to spring up since what was once impossible due to high labor costs now becomes possible. As the labor supply shrinks once again because of this, wages begin to rise. Economic output grows because of this, and all of us are better because of it. Workers who may have been in the now automated industries have found other niches, making similar amounts to what they did before. And because of automation reducing the prices of goods, their money is able to go further than it did before. Technology should be embraced, not feared. History has proven this time and time again. Don’t become a slave to your fears like the Luddites once were.

  15. Because Das Kapital :)

    Technology indeed has reduced work day to 4 hours for the capitalist, not for the worker.

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