Does inequality cause overwork?

Does inequality cause overwork?
Phineas Baxandall and Marc Breslow
March 1999

Compared to other wealthy western countries, America is a nation of workaholics. German workers, for instance, toiled a shocking 20% fewer hours than did Americans in 1997. These difference aren't simply cultural, since back in 1970 Americans and Europeans worked roughly the same number of hours. But since that time most European nations have used growth and increasing wealth to secure more leisure while Americans work 6% more than they did three decades ago.

More work, less security
During the entire year of 1997, U.S. employees (including part-timers) worked 61 more hours on average than they did in 1979, while average annual hours dropped by 90 in the United Kingdom, 190 in Germany, and 157 in France. Only in Sweden did annual hours rise, but they began at such a low level that in 1997 Swedes still worked fewer hours than in any of the other nations shown here. Even for hard-working Japan, the hours dropped by a dramatic 237 per person.

Economists Linda Bell of Haverford College and Richard Freeman of Harvard University suggest that one cause of overwork may be America's greater inequality. The bottom rungs on our inequality ladder are so undesirable, and the middle rungs so insecure, that American workers scramble more to keep away from the bottom.

According to recent surveys, workers in most of western Europe want to further reduce their work time. Only 4% of Germans wanted to work longer hours, while 38% preferred fewer hours with less pay. In contrast, even though U.S. employers already work long hours, 33% of them wanted to put in more time for more pay, while only 5% preferred to work less. And roughly two-thirds of Americans said they make a point of working hard, even if doing so "interferes with the rest of their life," while only a third of Germans respond this way.

Carol and Wilma
Consider, for example, the incentives facing two workers, Wilma in Germany and Carol in the United States. In Germany, pay differences are small, job security is high, unemployment benefits are good, and there is national health care. If Wilma works fewer hours and takes long vacations, she might be less likely to get a promotion or a pay raise, but can still maintain a reasonable standard of living.

Carol, in contrast, faces high wage inequality, little job security, and limited unemployment benefits. If Carol doesn't put in extra hours she risks falling into the ranks of the working poor, or losing her job-with little safety net available. So Carol works longer hours than Wilma. Perhaps the U.S. would be a happier, more relaxed place, with less stress on families, if incomes were more equal and everyone felt freer to work less. But don't count on many corporate leaders advocating this course anytime soon.

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