Labour’s 32 hour week proposal is amongst their most dangerous policies. Currently full-time employees work on average 37.3 hours a week. This proposal would reduce productivity by over 16%. The economists can grind that number to determine the reduction in GDP and profitability but I think we can guarantee that it won’t be a positive outcome.
The proposal will also create significant gaps in essential services – healthcare, policing, fire fighting. It is hard enough right now to access healthcare due to staff and skills shortages, let alone if their hours are cut.
The Labour suggestion is that this change would be phased in over 10 years. That isn’t really a consolation other than giving big businesses a fairly long lead time to pack their bags and leave the UK for more sensible, more productive, and more profitable locations. They haven’t got far to go – Ireland is close by.
The country could not afford to pay pensions at 60/65 and it is now rising to 67, an additional 11,500 hours for women, 3,300 for men. For younger workers retiring at 68, add a further 1,600 hours to that. So we all have to work longer to pay for our retirement. It’s a policy backed by all the main parties. McDonnell is now saying we can take off 10,000 hours by working 4 day weeks throughout our working life. What was the point of that? He can’t add up, clearly, and that’s pretty dangerous for a Chancellor.
There is an interesting article on Lib Dem Voice at the moment where Eddie Sammon makes a case in favour by using voluntary tax breaks for employers. It’s a better approach but some of the comments are not quite as supportive. I particularly chime with what has it got to do with the Government what hours I work. Preventing exploitation is the Government’s job so progressively reducing the maximum working week from 48 to 45 hours, and including all NHS workers, is a good idea. For environmental reasons, working your average 37.3 hours over 4 days instead of 5 makes sense and a lot of people already do that. Neither require a 16% reduction on the average working week.
If I may quote Eddie’s final line: “I still believe that GDP growth is desirable, but as Jacinda Ardern and Jo Swinson have said, a country’s prosperity cannot be judged on economic growth figures alone.” I completely agree with the latter sentiment although I am not convinced GDP growth is that desirable in a stable and wealthy economy as it sucks up natural resources in creating ever more growth. What we should be looking at is distributing GDP somewhat fairer than we currently do.