More on work

May 8, 2007 on 5:18 pm | In Uncategorized |
A global financial management company called UBS publishes an annual comparison of prices and earnings around the world (downloadable here). The 2006 issue makes some perceptive observations about the differences between ‘lazy’ Europe and ‘efficient’ USA. What these stereotypes really refer to is the extent to which people choose to take the benefits of increased national production in the form of income or leisure.
Back in the 1950s it was pretty much taken for granted in Australia that increased productivity would lead to increased leisure time. In fact that’s the way it was for a while: in the 20th century the 48 hour week gave way to 44 and then 40; two weeks’ annual leave became three and then four, and so on. I was involved in (resisting) a series of union 35 hour week campaigns in the 1970s and ’80s but most people had the sense that we were only holding off the inevitable; when we conceded the 19 day month it was widely perceived as the forerunner of the nine day fortnight and eventually the four day week.
Over the last 20 years, however, this tendency has reversed. I haven’t seen any research but I suspect a lot of people who used to have rostered days off have lost them and much of the workforce has actually reverted to a de facto 40 hour week, and it’s been a long time since anybody seriously suggested increasing annual leave. Quite the opposite - workers are now allowed to substitute income for up to two of the four weeks’ leave they already get. And any politician who suggested adding another public holiday to the small number we’ve inherited from days gone by would be branded as a traitor. To keep calling Australia ‘the land of the long weekend’ is now simply ridiculous.
The reasons why this has happened are complex but at bottom, it seems there was a gradual shift in people’s preferences from increased leisure to increased incomes. It’s a matter for debate how much of that was a genuine, spontaneous change and how much was engineered by government and business by using the global competition bogeyman. Maybe people just got scared into working longer hours and the higher incomes followed naturally until a new cultural mindset was firmly entrenched.
This graph from the UBS report reveals that choosing the American path was perhaps not as unavoidable as was made out - indeed as continues to be made out by the Howards and Costellos of this world who pretend that any slackening of effort in the relentless global rat race will see poor old Oz discarded to the minor leagues in perpetuity. The graph shows how different countries have contributed to increasing their GDP:
The European countries’ contributions from time worked have been negative; in other words they have been working progressively fewer hours which has reduced GDP. In the USA, on the other hand, time worked has been virtually unchanged. This has predictable caused the USA’s GDP to increase at a greater rate than Europe’s but the Europeans, especially France and Germany, have partially offset this by increasing productivity at a higher rate than the US. Not surprisingly, because capital chases opportunities for growth, new investment in the USA has outstripped that in Europe.
Needless to say, conventional wisdom in Australia portrays this as a triumph for the USA. However, it’s a very one-dimensional perspective that privileges income over leisure. If, as the UBS report suggests, Europeans are simply expressing a preference for leisure over income then there is nothing inherently ‘better’ about either approach, at least economically.
What is better is that the European choice makes less demand on non-renewable resources and the environment. In a climate where everyone isn’t obsessing about maximising income, the EU has been able to make some tentative steps towards tackling global warming even though they will affect GDP, whereas in the USA the over-riding instinct is not to do anything that will harm ‘Teh Economy’.
It’s hard to say how and why Australia stopped being a European nation and became an American one. Nor is there any sign that we are having second thoughts; Howard’s mob are doing everything they can to force people back into the workforce and to deter them from retiring while ever they can be gainfully employed but there are few signs of public resistance. Anything for a new home theatre system and an extension on the house to put it in, apparently.
I have a sneaking suspicion that sooner rather than later, income growth around the world is going to come to a shuddering halt. It seems to me that psychologically, the Europeans are reasonably well-placed to adapt to such a development and we know that the Japanese are because they already did it through the 1990s. Australia and the USA? I suspect they won’t fare so well … when your life’s values are based on acquisition of material goods financed through endlessly increasing income, having to swap income for leisure will be a hard blow.
Not for me though … I took the European alternative 12 years ago .

4 Comments »

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  1. I’m taking the Euro option, too. And loving it. Just have to convince the missus to take a step back now. Soon.

    Comment by Damian Doyle — May 8, 2007 #

  2. It’s a matter for debate how much of that was a genuine, spontaneous change and how much was engineered by government and business by using the global competition bogeyman.
    How well I remember Tina - “There is no alternative” - spurious old bitch that she was.

    Comment by zoot — May 8, 2007 #

  3. What use the extra income if there is no time to enjoy it. It’s a simple enough equation. I’ve at times hovered in proximity to those who exhibit that: actual or aspiring-to mega money, and absolutely no time to so much as scratch their asses, and furthermore they congratulated themselves on this state of affairs.

    No way.

    Comment by Kieran — May 9, 2007 #

  4. Oh and further to the other question, well it’s also quite simple: what happens when a populace conditioned to greed - and it is greed, it is evil - and ever increasing prosperity finds the wall is approaching fast, and maybe even starts to slide backwards?

    What happens? Shit happens. Fascism happens.

    Comment by Kieran — May 9, 2007 #

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