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Work-time reduction to tackle unemployment and improve quality of life

by Anders Hayden

Work-time reduction (WTR), in the form of work-sharing, is an effective policy to limit the unemployment impacts of economic crises, including the Covid-19 crisis. With further economic and environmental challenges ahead, this policy brief recommends that Covid-19 short-time work schemes, which have been supported by SURE (Support to mitigate Unemployment Risks in an Emergency), should evolve into longer-term policies to lower average working hours and be included e. g. in national Resilience and Recovery Plans (RRPs), Country Specific Recommendations (CSRs), or National Reform Programmes (NRPs).

This brief will summarize existing research and examine the ecological arguments for WTR and consider some key challenges and points of debate. WTR has the potential to deliver a ‘triple dividend’ of unemployment reduction, lower environmental pressures, and higher quality of life. Unemployment reduction can be achieved by sharing the work available at a given time among a larger number of employees. Pressures on the environment can be mitigated by using productivity growth to reduce hours of work rather than increase consumption, while enabling more environmentally sound lifestyles, including a reduction in the number of daily commutes to work. Lastly, more ‘time wealth’ can also be a significant source of greater wellbeing.

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