Blow to France's 35-hour week law

[RandFan]

Blow to France's 35-hour week law

Can france withstand the pressures of international competition?

The near-unanimity of the vote at Bosch's Vénissieux plant near Lyon is expected to encourage other companies to seek ways of securing greater flexibility in Europe's rigid labour markets, in the absence of political will for reform. The vote was the first of its kind in France and could set a precedent for a gradual de facto reversal of the 35-hour week.

And it looks like Germany is already on the path to end it's law.

In Germany, moves to extend working hours could become unstoppable. Siemens had said it would otherwise shift production to Hungary - a threat that Nicolas Sarkozy, French finance minister, described as "a form of extortion that would be unthinkable over here". Other big companies seeking longer working hours in Germany include MAN, Linde, Bosch and Opel.

Is it realistic for governments to make such laws?

 

[aerocontrols]

Is it realistic for governments to make such laws?

Sure it's realistic to make such laws. They may get changed, but the law won't be abolished, the maximum hours per week will merely be increased.

 

[Number Six]

I don't know if it's ridiculous for governments to make such laws but it is ridiculous for a government to make a law that makes 35 hours be full time and then expect it to solve their unemployment problem.

And I believe I read that in either France or Gernmany, in at least some situations, workers are forbidden from working more than 35 hours in a week. If so, it is ridiculous raised to the n-th power.

 

[Bjorn]

What's the problem? Three guys work 105 hours in total or two guys do the same 105 hours in total, it's just dividing the same amount of work between three guys instead of two.

If there isn't enough work around to secure everyone a job, why not work fewer hours and keep more people out of unemployment?

The reference to 'shift production to Hungary' has to do with the pay per hour, not the hours worked per week.

 

[Ion]

What's the problem? Three guys work 105 hours in total or two guys do the same 105 hours in total, it's just dividing the same amount of work between three guys instead of two.
...

I agree that three guys working 105 hours that's better for keeping unemployment down than two guys working 105 hours.

The country that forbids more than 35 hours per week so that unemployment is down, that's France.

In contrast, Bush in U.S. fights to disallow overtime pay, and a U.S. worker doing 80 hours per week is still paid 40 hours while someone is unemployed.

For zealous people comparing France's and U.S.' unemployement, keep in mind that the unemployement figure in France means just that, while the 'unemployement' figure in U.S. needs to be adjusted by adding to it the number of people that are on welfare and people out of work for so long that they are inelligible for welfare.

I know an accountant at Petco in San Diego, U.S., who is asked to do 80 hours, he does them, and he is paid 40 hours while someone is unemployed.

 

[Grammatron]

What's the problem? Three guys work 105 hours in total or two guys do the same 105 hours in total, it's just dividing the same amount of work between three guys instead of two.

If there isn't enough work around to secure everyone a job, why not work fewer hours and keep more people out of unemployment?

The reference to 'shift production to Hungary' has to do with the pay per hour, not the hours worked per week.

Well the problem may come in when you only have X amount of people capable of doing the job in the area and you are limited to Y amount of time per week. If either is not enough you will start running into problems.

 

[Ion]

This:

Well the problem may come in when you only have X amount of people capable of doing the job in the area and you are limited to Y amount of time per week.
...

is invoked so much that it is abused.

The solution is to increase (X) to (X + many more) thru training and communication.

I said that it is abused, since I saw it abused in U.S. in numerous cases of this type:

a company (often a start up) has a manager that claims there are no funds and time for training, the manager -who is a out of touch with first hand knowledge of the technicality of the work- goes on vacation and relies on a one man orchestra to do the work and give the manager a free ride.

 

[RandFan]

What's the problem? Three guys work 105 hours in total or two guys do the same 105 hours in total, it's just dividing the same amount of work between three guys instead of two.

Employees must be trained and they must be competent to do a job. There is a cost for each employee in training, benefits, vacation time, sick time, etc. While you have reduced the problem to simple division in truth it does not work that way. The fewer the employees who can perform the same amount of work the greater the efficiency. Companies can maximize their investment/cost if they can get more hours from their employees. Not a new concept by the way.

1.) 3 employees working 105 hours cost more than 2 employees working 105 hours.

2.) In a 40 hour work week 2 machines can be operated by 2 employees for a total of 80 hours. In a 35 hour work week 2 machines can be operated by 2 employees for a total of 70 hours. A third person will not increase operation time unless a third machine is purchased. A third machine would increase capital expenditures and would not net an increase in efficiency only an increase in output. However, increasing hours worked would increase efficiency.

And that's the very real problem.

 

[Bjorn]

Well the problem may come in when you only have X amount of people capable of doing the job in the area and you are limited to Y amount of time per week. If either is not enough you will start running into problems.

That might be so. However, why one needs to let burger-flippers work 70 hours instead of 35 hours each, I don't understand. The companies mentioned in RandFan's first post are not complaining about lack of available workers, only about restrictions on work hours.

 

[aerocontrols]

For zealous people comparing France's and U.S.' unemployement, keep in mind that the unemployement figure in France means just that, while the 'unemployement' figure in U.S. needs to be adjusted by adding to it the number of people that are on welfare and people out of work for so long that they are inelligible for welfare.

Please expand on this. I'm curious what you mean.

 

[Bjorn]

Employees must be trained and they must be competent to do a job. There is a cost for each employee in training, benefits, vacation time, sick time, etc. While you have reduced the problem to simple division in truth it does not work that way. The fewer the employees who can perform the same amount of work the greater the efficiency. Companies can maximize their investment/cost if they can get more hours from their employees. Not a new concept by the way.

1.) 3 employees working 105 hours cost more than 2 employees working 105 hours.

This has to be proven. A simple shot in the dark: What about more sick leave because of longer working hours? Does anyone know?

2.) In a 40 hour work week 2 machines can be operated by 2 employees for a total of 80 hours. In a 35 hour work week 2 machines can be operated by 2 employees for a total of 70 hours. A third person will not increase operation time unless a third machine is purchased.

One more shift, and three people times 35 hours work 105 hours per week .... ?

 

[RandFan]

I should also note that increasing the number of employees often increases administration costs of staff and other expenses. These increased costs only affect the bottom line in a negative way.

It is for this reason that many companies are more than willing to pay time and a half for overtime. While the per hour cost is higher it is lower than the over-all cost of adding a new employee.

 

[RandFan]

This has to be proven. A simple shot in the dark: What about more sick leave because of longer working hours? Does anyone know?

You mean proven to you? It's as proven as any thing else taught at major universities. Also, the proof is in the pudding. I've been there btw, as a manager who had to make these types of decisions. Should we offer overtime or hire new people. Often overtime was cheaper.

I'll dig up some data on it.

One more shift, and three people times 35 hours work 105 hours per week .... ?

Yes, one more shift. More electricity for the lights, more administration, etc. An added shift is an increase in costs and reduction in the bottom line.

Edited to add, an additional shift will not increase efficency only output and we will need more support people to keep that individual working.

 

[Cain]

What's the problem? Three guys work 105 hours in total or two guys do the same 105 hours in total, it's just dividing the same amount of work between three guys instead of two.

If there isn't enough work around to secure everyone a job, why not work fewer hours and keep more people out of unemployment?

The reference to 'shift production to Hungary' has to do with the pay per hour, not the hours worked per week.

Economists call this the "lump-of-labor fallacy." French and european unemployment rates are still higher than the United States'. Why? This so-called fallacy rests on a few false assumptions: the assumption that jobs are interchangable or homogenous; the notion that productive labor (and an economy's output) is fixed.

Of course it's also been said that if economists could be sued for malpractice, all of us would be rich.

An economist on the Pen-L mailing list sent a letter to the Times' (left-leaning) Paul Krugman when this fallacy surfaced in a column.

See:
http://archives.econ.utah.edu/archives/pen-l/2003w40/msg00040.htm

But those are the arguments pro and con, generally speaking.

 

[Bjorn]

You mean proven to you? It's as proven as any thing else taught at major universities. Also, the proof is in the pudding. I've been there btw, as a manager who had to make these types of decisions. Should we offer overtime or hire new people. Often overtime was cheaper.
I'll dig up some data on it.

Yes, one more shift. More electricity for the lights, more administration, etc. An added shift is an increase in costs and reduction in the bottom line.

Edited to add, an additional shift will not increase efficency only output and we will need more support people to keep that individual working.

My friend, it's not like I think 35 hours was a measure given by the god of labour, but even the fast food chains of the US recognize that there is a limit to how many hours each person can work per week. At some point, one has to let two or three or four or five people share the job.

The theory of 'one more person to train and to insure means a higher cost' can only work so far. Let him work 200 hours a week, and he becomes a danger to himself and everyone around him. By the way, I didn't see any answers to the questions about sick leave: Is there any number of hours per week where the sick leave and/or accidents rise to a level where it would be better economy to have more people share the same workload?

 

[RandFan]

The theory of 'one more person to train and to insure means a higher cost' can only work so far. Let him work 200 hours a week, and he becomes a danger to himself and everyone around him. By the way, I didn't see any answers to the questions about sick leave: Is there any number of hours per week where the sick leave and/or accidents rise to a level where it would be better economy to have more people share the same workload?

Bjorn,

Absolutely there is a point of diminishing returns. Also there are many diverse companies and jobs and such assumptions are not universal. However they are significant when comparing a 35 hour work week to an 40 hour work week when it comes to a typical job.

As to the sick time. The numbers have been factored many times by many people. Companies are by and large interested in the bottom line. If efficency would increase by lowering the number of hours worked in a week, trust me on this, many companies would do it. I note that it is only government and not industry that is interested in shorter work weeks.

I will say this, it seems the average American worker is capable of an astonishing amount of work when given the incentive. Of course there are long term side effects to health and family.

I can easily say that there is a significant increase in overall efficiency from a 35 hour work week to a 40 hour work week and beyond. Somewhere you will reach a point of diminishing returns. I don't know where it is but it is certainly more than 40 hours.

 

[DanishDynamite]

What's the problem? Three guys work 105 hours in total or two guys do the same 105 hours in total, it's just dividing the same amount of work between three guys instead of two.

If there isn't enough work around to secure everyone a job, why not work fewer hours and keep more people out of unemployment?

The reference to 'shift production to Hungary' has to do with the pay per hour, not the hours worked per week.

The problem is productivity. Having more people do a given amount of work will reduce productivity and ultimately reduce the standard of living (all other factors being equal).

Of course productivity isn't everything and man doesn't live by "GDP per capita" alone, but reducing productivity just to have more people employed, doesn't seem like the way forward.

 

[Bjorn]

The problem is productivity. Having more people do a given amount of work will reduce productivity and ultimately reduce the standard of living (all other factors being equal).

It has been posted before - and there seems to be some kind of agreement that your statement is true. Evidence, anyone?

Of course productivity isn't everything and man doesn't live by "GDP per capita" alone, but reducing productivity just to have more people employed, doesn't seem like the way forward.

Dividing the labour between those available to do it might be a bad idea, unless unemployment becomes a big problem for our societies. Which it might, soon.

 

[Agammamon]

. . .Three guys work 105 hours in total or two guys do the same 105 hours in total, it's just dividing the same amount of work between three guys instead of two.

If there isn't enough work around to secure everyone a job, why not work fewer hours and keep more people out of unemployment. . .

There's two problems with this

1 its predicated on the assumption that there is only a fixed amount of work in an economy. That's patently untrue. The amount of work expands to fill the available labor. 200 years ago in the US 95% of all employment was in agriculture, today less than 5% is. the remaining people aren't just sitting on their arses eating the food the the 5% produce, they're out there working.

2 By limiting the amount of work allowed per laborer, coupled with an extremely high minimum wage, means that its very costly for businesses to expand services in France. If you've noticed, supermarkets in France don't provide bagging services for shoppers (something that is considered de riguer in the US). They can't afford to.

These sort of restrictions are, at best, a temporary solution to the unemployment problem, and (compared to the US at least) actually tend to make the problem worse. While those in France with jobs are making a living wage (barely) there are a huge number of people who can't get a job at all.

Its not keeping people off unemployment, quite the converse, its forcing larger and larger numbers on it. The US has a roughly 30% higher standard of living than the continent.

 

[DanishDynamite]

It has been posted before - and there seems to be some kind of agreement that your statement is true. Evidence, anyone?

The evidence is in the definition of productivity. Output per worker.

Deviding the labour between those available to do it might be a bad idea, unless unemployment becomes a big problem for our societies. Which it might, soon.

IMO, deviding the labor, just to keep people "employed", is almost always a bad idea. A much better idea is to make sure that starting a business or firing and hiring people is met with as little beurocratic nonsense as possible.