A growing number of high-paid professionals in the UK are choosing to work fewer hours. Some commentators claim this signals economic weakness, declining productivity, or the consequence of bad tax policy. This video explains why that interpretation is wrong.
When people reach a point of sufficiency, working fewer hours can improve health, well-being, productivity per hour, and the transition into retirement. It can also open opportunities for younger workers, improve skills transfer, and reduce burnout across the economy.
This is not a withdrawal from work. It is a rational response to the scarcity of time, and not money, and it challenges outdated ideas about growth, productivity, and success.
This is the audio version:
This is the transcript:
There is a phenomenon being observed in the UK economy at present, which is that some of the best-paid people in this country are working less, by choice and are, in fact, even going part-time, and as a consequence are improving their quality of life.
A recent article that I read suggested that this is an indication of a crisis of confidence in the UK; a failure of people to absorb the work ethic as they go up the ladder of seniority, and it's all, in any case, because of bad tax policy, which the article in question blamed on the Labour Party, although, as far as I could work out, all the policies that they were referring to had in fact been created during 14 years of Conservative government. But whichever way you look at it, I think that if we look at this situation and argue that there is a crisis going on because people want to work less, we've got the wrong end of the stick about the relationship between work and life, and to me, that matters.
The fact is that there is very strong evidence that average working hours, particularly amongst people who are higher paid in the UK, those who are earning over £75,000 a year or more, are actually declining. This change amongst the highest earners, those earning over a hundred thousand pounds a year, is quite marked. They might be reducing their hours by up to 10%, but that isn't just because we have a tax break at around the £100,000 income bracket. That's not the case at all in my opinion. I'm suggesting that these people are reducing the amount of time that they spend working by choice, not because they've got a loss of confidence in the UK economy or because they're tax-averse, because there are plenty of other ways in which they can manage that tax break. Instead, it reflects the fact that they are looking for better ways to live.
They've realised that when your income reaches a certain point, you've actually got enough, and there are other things to do in life apart from work. In that case, framing reduced hours as economic weakness or a sign of falling productivity or a threat to growth is absurd.
The assumption that work is always better and that more output is always progress is, in fact, wrong because there is a point in life where that isn't true.
Now, in a blunt way, we call that point in life retirement, but because people who are in the pre-retirement era are very likely to be amongst the highest earners in society, and therefore those about whom these claims are being made , we are misinterpreting the situation. People, in fact, don't want to retire at a blunt point of time.
As people now are getting into their fifties and maybe a bit beyond, because people do work well into their sixties, they find they've reached a point where their housing is secure, their pensions have become credible, and their basic material needs are met largely because the children have left home if they ever had them. At that point in time, they suddenly realise that there are things more valuable than money, and that is the phenomenon that we are observing.
People realise that money can accumulate without limit, but time cannot, and health, relationships, meaning, and care, all require an alternative investment, particularly if retirement is going to be long and meaningful, because there is plenty of evidence that those who work flat out to retirement day and then stop and do nothing thereafter have quite short lives as a result; the shock is too great to manage.
So rational people are beginning to manage what is scarce, and this has literally nothing to do with tax. Choosing fewer hours of work as you get older is not irrational. It's logical.
And in fact, there are real benefits from encouraging older people to work a bit less. For example, when senior, well-paid staff reduce hours, space is opened for younger workers, not just to be recruited, but also to be promoted. The opportunities for those younger people to get up the ladder is increased, and skills are transferred rather than hoarded because that's necessary as older people begin to recognise they're going to give way. In other words, labour markets will become more porous, and opportunity is shared and not blocked.
Now, this is circulation and not stagnation that we're talking about here. This is growth potential and not loss of it, and this is about a healthier transition within society. This manages the shock of retirement, but it also lets businesses adapt to the fact that older people will eventually leave.
We have to manage that transition in a way that we've not been very good at. We hear time and time again that there are some professions, some forms of work, which are dominated by older people. Train drivers are a perfect example of this. About half of all train drivers in the UK are aged 50 and over, and inevitably, we're going to face a crisis of a shortage at some time because we simply aren't allowing for flexibility to ensure that younger people can join what is a well-paid workforce, because we are not doing the transition, but we need to. And this message that older people want to begin to phase out of work rather than work till the last moment and then retire is an incredibly important one, and one I think we need to look at.
It also means that we would manage mental health better, because long hours are well correlated with poor mental health, chronic illness, and reduced life expectancy, and that's particularly true in demanding professions where burnout is known to be a very high risk. So, fewer hours can actually mean better productivity per hour worked, and better decision-making, and longer working lives overall because people want to stay rather than quit at the first possible opportunity.
Again, the clues are being misread. Falling working hours amongst people who are well paid is not a sign that they want to opt out of the economy. It is a sign that they want to opt into life whilst letting others have the chance, in economic terms. People are not, then, rejecting work. They are rejecting overwork, and meaningless pressure, and endless accumulation. That's just because these things are actually contrary to well-being. This is not, therefore, about withdrawal; it's about their expression of agency.
There is a deeper economic meaning in all of this. Traditional economics equates value with output and success with growth, but well-being does not scale with hours worked, nor does consumption beyond sufficiency. What people are realising is that the economic model that they've been taught, that we should keep growing forever, come what may, is simply wrong. It contradicts actual life experience. So this has a political consequence: if people stop chasing income, growth narratives weaken. But what we do get instead is an intergenerational narrative, which is at least as important, if not more so.
It also means that fear-based incentives lose their force, but care, time and stability gain value. And if that's the case, politicians would have to notice because it creates a value shift. Now, this isn't a revolution, and nor is it a sign of failure. It's simply a message being sent that the state should think differently.
The state should now support flexible and phased working. And in this context, the fact that the Labour government is currently condemning councils who are exploring four-day working weeks because they are evidenced to increase productivity rather than reduce it, for precisely the sorts of reasons that I've been exploring here is worrying.
There is a fetishism amongst those in power about hours at work and presenteeism, but in fact, recognising that care, health, and time are as important in economic terms is vital because those who have those priorities do still want to work, but they need labour markets that are designed for lifelong participation, dignified transitions from work into retirement, and the creation of shared opportunity.
Economic success is not measured by hours worked, and output maximised or consumption inflated, in other words. It does depend upon lives lived well, stress reduced, care made possible, and futures made secure. Working less can mean living better. This is progress and not decline. We shouldn't be fetishising the fact that people are choosing to work less; we should be celebrating it if they can afford to do so, and be encouraged by the opportunities that they're creating for others. A mature economy allows people to choose when they've had enough. It's time that our economy did that, because if it did, we'd all be better off.
What do you think? Do you think that working less might lead to better life opportunities for you and those you know and care about? Let us know. There's a poll down below.
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As they say ” you can’t buy time”.
Incentives to work, measuring productivity, etc.. are fascinating subjects. A few (random-ish) thoughts……
First, at the lower income end of life the “incentives” for work are all about compulsion rather than encouragement and choice. So, as we speculate about why people are reducing hours, retiring early we should not ignore their plight…. and perhaps think about how we do better to make “work” for these folk. Having said that….
Productivity measurement is weird. I recall an economist colleague saying (in the face of intense opposition) that technology was not increasing productivity – all that was happening was that people were working longer hours because they could. In effect, on call or actually working far more hours. Yes, output was up… but so was hours worked (if not people employed or wages paid).
When a GP goes to 3 days a week – do they really get all their tasks done in 3 days? Most, I suspect, work at least 4 in order to do their job properly…. but without pay. Are they more or less productive? Not clear.
We often measure output in monetary terms. Is a GP working in the NHS more or less productive than one taking private appointments more or less productive? Do we measure by (real/notional) pounds paid? Or by patients seen? You get different answers.
I am not sure about other industries but “part time working” doesn’t really work in investment banking. Those that get to the top and make decisions about these things are obsessive psychopaths (maybe a bit harsh – but you get my drift). They just don’t understand why anyone would not work 24/7 to climb the greasy pole…. anyone that chooses to challenge this is booted out. It’s 100% or nothing.
I recall saying to an old boss/friend “I don’t want to be a Managing Director, I would be perfectly content to just sit and trade, get paid £X a year and go home at 5.30. Do it for 7 years and quit”. His reply was “… and that is why you will never get paid £X a year”. Sadly, he was right…. and I was out of the (formal) industry before I was 40.
Much to agree with.
And as someone who lived with a “3 day a week” GP at in e time, I can tell you 4 days was normal.
Who on their death bed said I wish I’d spent more time in the office?
One way the government could help is by stopping the continual upward drift of the age at which one becomes entitled to draw the state pension. Not many people want to keep working into their late 60s, and there are all these younger people having difficulty getting decent jobs. A lower pension age could be a win-win.
I agree. 67 is too late.
Phased retirement, which you discuss above, applies to few people, and these have choice. Most don’t. Different kinds of employment need different retirement ages, such as manual work. I know a gardener, 59, who is finding it very hard to do his job as he could 5 years ago. Conversely, some academics are approaching their best age, when they can synthesise ideas better than they could earlier. In fact, perhaps we could individualise the age at which people draw a pension, based on individual assessment. It can’t be beyond actuarial ability to adjust their programs to this. Perhaps we could start by having an idea of how many years of retirement we are willing to pay for, on average, for different groups?
This can only be relevant to state pensions. But then, how is the politics overcome? And how is the opportunity to change work managed?
The state pension is not sustainable in it current form and with the built-in promises made to support it which demand an ever greater share of the total compensation in society.
Jim raises an interesting question as to whether reducing the age at which you get it (while presumably not reducing the amount) would be a win-win. This has been analysed by people poring over the data, and these analysts get called economists, but we have to at least be aware that the analysis has been done before suggesting doing it. Reducing the state pension age is a net loss to the economy.
Please define your terms.
Why is people not working in old age a “net loss to the economy”.
What matters more to you? GDP, or people?
The Irish civil service have a weird retirement system.
They are forcibly retired at 54 but have to wait until 67 to get a pension.
So there are lots of retired civil servants that have to continuously look for work and get unemployment payment.
I agree that I was talking about state pensions. Estimates for how many people depend on the state pension, only, vary between 13% and 20% of the nearly 3.5 million retired people. How strange that we don’t know. But these are people who’ve done low-paying jobs, often care or maintenance, and are physically worn out by 60-65. My builder son, at 52, has already had 3 hip replacements, but still needs to work on roofs. I. on the other hand, only retired because the small R&D company I worked for went bust and no-one else wanted me. I’d happily have gone on till 70 or even 75 if it had been possible.
Thanks
Good luck to your son.
If you have the means to retire in your 50s then go for it. You’re only young once. For many, late 50s – mid 60s is still “young” or at least young enough to be active in the newly acquired spare time. I’m 57 and will hopefully be retiring soon to spend more time with my bike.
But the reaction of companies to over 50s scaling back their hours does highlight weakness in the economy. Whilst there’s likely no meaningful skills gap longer term at the higher end of the experience scale (everyone gets a chance to move up and prove themselves at a higher level etc.) the lack of recruitment at lower levels isn’t consistent with a gung-ho (or even close to it) economy.
Hopefully some stability in the corporate tax / regulatory regime will prevail over the next couple of years, allowing businesses to plan for the longer term rather than just deal with the latest government change. This isn’t a party political comment. There hasn’t been much stability since the “Brexit Wars” kicked off in 2017 regardless of who’s been in charge (or notionally in charge whilst being asleep at the wheel).
Politely, Bob, again you are talking nonsense. If you really think businesses spend all their time dealing with tax and regulatory change you know nothing about business, at all. Expect to be deleted if you writ more of this nonsense – because that it what it is. It’s either that, or an excuse by someone with no idea how to succeed in business.
Politely, Bob has implied that he does not think that.
You clearly think that frequent changes to tax and regulation have no effect on business planning. Well bully for you, but the real world begs to differ.
You forget, perhaps, I know a great deal about the real world. I was senior partner of a firm of accountants with 800 clients and ran entrepreneurial companies. As matter of fact tax and regulation never held us back, and nor did they hold back clients. You are just wrong. They are used as excuses by those who have no idea how to run businesses.
Re “Politely, Bob, again you are talking nonsense. If you really think businesses spend all their time dealing with tax and regulatory change you know nothing about business, at all. Expect to be deleted if you writ more of this nonsense – because that it what it is. It’s either that, or an excuse by someone with no idea how to succeed in business.”
Deleted by Lord Murphy of Buffoondom? How will I live with myself?
I’m out of here. You are the living embodiment of “Never argue with fools. They soon drag you down to their level and then beat you with experience.”
So, I rumbled you as a neoliberal troll. Now you revert to type. You lot always do, resorting to the only things you know how to do well which ate a) repeat the mantra and b) use verbal abuse.
The old saying you should work to live not live to work still applies. I agree with what you say but I do think covid has a big part to play. Tax policy at the top end hasn’t changed much ov3r the last ten years so that can’t be much of a factor. Many people my age (64 now 58 then) enjoyed being away from the office and a lot never returned ( three of my pals stayed on the golf course). With more pressure on young families looking aft3r grandchildren – as well as being a joy – is a necessity for some.
I admit, Covid did change my work patterns for good. I never really went back, and massively improved my productivity as a result.
Agreed 100%. Work is stressful, tiring and time consuming. It represents the biggest ‘opportunity cost’ in terms of time and energy in most peoples’ lives. Even though I like my job, I’d rather have more free time. So would most people I ask. Middle class women’s mass entry into the workforce (working class women mostly had to work already) seems to have made two incomes essential for a middle class lifestyle. Obviously I blame rent and house price inflation…. If you rent you never reach the freeing moment when your mortgage is paid and you can cut your working hours. But I’d be interested to know why other people think that increased workforce participation and automation hasn’t led to drastic cuts in the working week? Why is anyone still working more than say 25 hours a week? In a two adult family why wouldn’t 50 hours of work between them in a week be enough for a family to live well on? Are anti union legislation and wage suppression the biggest culprit? What else is going on?
The issue is rent extraction. Work time is pushed to the limit to feed rent extraction via mortgage and other interest, rents themselves, profit gouging and more e.g. utility pricing. This is why two income households have become the norm: the profit gougers know they can push people that far.
This has been obvious to me and I’m sure many people for a long time; but I think the problem has been that evidence of what you are saying needs to be collated and presented to the government if we are to achieve anything in this area. Unfortunately many in the current and previous conservative governments are entrenched in their belief that hard work is ultimately more productive and preferable to improving the lives of working people.
The area of work is a complex subject with a very long history through feudalism and the protestant belief system which is keeping the people of this country (UK) in captivity to its ethos through the power of the government and many of the employer class today. I do believe there needs to be a complete rethink of what we are doing to the people of this country both young and old.
A basic income scheme might work here. This would encourage part time paid work and promote flexibility, creativity more time for family and relationships and quality of life rather than nose to the grindstone of authoritarian capitalism.
Turning 60 this year means that I am all for this line of thinking albeit not in the income bracket where I can afford to think about it (I only got 2 yrs of a final salary pension when I joined the public sector because Blair’s Labour got rid of the final salary one no doubt sticking to the PSBR ‘rules’ that the Tories laid down, whilst giving huge tax breaks to the private sector pension providers).
My worries are more on the practical side though for these highly paid types – how they manage and who (if anyone) picks up their work. Working from home culture I feel in the Council I work for is much slower in its responses, not always clear what is going on and I see workloads very badly managed. So as I said I broadly agree that that is OK but the way it should be done needs some careful consideration.
Agreed, planning is key – but I think that was in what I said.
Sorry – badly written – I was actually trying to support your view about good planning – because I just don’t see it in reality from the people on the pay scales you talk of where I work at least.
For many people my working age, work no longer provides the satisfaction of life ambitions. People want to live their lives and our present economic system does not fit in. The economic system incentivises people to forget what life is. Majority of the incentives are purposeful designed to get people to do what they don’t want to do. We are told work is a virtue. What we haven’t done is been given the space to discover that for ourselves. Grab the money and run. Become financial independent and retire by 40 is the mantra. Life long learning is forgotten dream.
I voted for the greater wok/life balance. However, I think the most important aspect in the article is “ We shouldn’t be fetishising the fact that people are choosing to work less; we should be celebrating it if they can afford to do so, and be encouraged by the opportunities that they’re creating for others.”
Many of my friends / acquaintances did choose early retirement (usually because of enhanced redundancy packages from O&G companies) and that is working well for them. However, it didn’t usually result in increased opportunities for younger people really it was just corporate profit maximisation.
On a personal level, I’m in a very senior role, seldomly work less than 60 hours a week and am well into my 60’s and I choose to work. Why? Partly because I enjoy it but more because I can – along with my colleagues – create job opportunities and thus directly and indirectly address poverty and lack of opportunity in our communities. That drives me and it makes me feel good. Using my experience, knowledge, etc., I can benefit local communities and the commutable area by creating jobs and opportunities. The point is that whilst being able to afford a reduction in hours is an important consideration and improving overall well-being is even more important. The key is to provide the opportunities to enable people to make a choice to reduce hours, retire early or continue working because they want to….not because they have to.
My simple take on all of this. We need to pay care workers, junior members of staff and up into the middle ranks more so that as they approach the twilight of their working lives, they can afford to make the choice whether they cut-back on hours worked, retire, become an unpaid (or paid) mentor / advisor, as in parts of Japan provide (usually free) crèche supervision (and keep costs of child care down), etc., or, because they want to and feel they can add value by continuing to work. The key is to create the circumstances and opportunities that people can afford to make the choice that is best for them. Sadly, many do not have this opportunity, nor can afford to do so.
Much to agree with.
My greatest pleasure from work has always been creating new jobs, and providing opportunity.
This video should be seen by everybody. It covers issues we all face with regard to work/life and leisure balance. I remember studying motivation theory, particularly the contribution of Fred Herzberg, who had much to say on the subject with his theory on what motivates workers. His conclusions were that pay was not a major factor, but being treated with respect was.
He emphasised the importance of leisure and time spent away from work leading to a much better outcome for both employer and employee. That was 60 years ago, so I would have expected this to be de rigeur by now in a civilised society. Your video seems to be saying much the same, which I heartily endorse.
Much to agree with Herzberg on. Thanks.
Absolutely agree with this assessment. From an employer perspective, phased retirement, where affordable for the employee (and I accept this is not true for all), allows for passing on of key skills to younger workers while allowing space in the staffing structure of organisations for those younger workers to gain experience, responsibility and progression opportunities (i.e. reducing the “dead men’s shoes” scenario which can cause organisations to stagnate). Furthermore, these “partially retired” people are often extremely active in volunteer roles bringing years of experience which the not-for-profit sector could otherwise ill afford.
Phased retirement was something my father did, 40 years ago: dropping one and then two days per week; but with reduced responsibilities. (He was in commercial insurance, so was able to keep on with his existing clients but not develop new business – leaving that to the eager, younger men (mostly) in his firm.) He spent more time on organic gardening and some other hobbies; and volunteering, using his admin, finance and insurance knowledge for a charity.
It occurs to me, however, that reduced working hours should also be much more ‘the norm’ for people earlier in their careers – particularly if they have family responsibilities or are carers: people do of course do this, if they have employers who are amenable (beyond statutory parental leave); or, they simply take less-demanding (and usually much-less-well-paid) jobs, without the pressures of ‘going the extra mile’ to achieve corporate goals and the like. But the lack of flexibility in a lot of workplaces leads to both the loss of openings for the next generation that you describe; and (when individuals simply walk away and work in other sectors) the loss of skills and talents.
Keynes (of course) described a situation of ‘adequacy’ (in terms of GDP and personal and public provisioning) in which working hours could progressively decline: The Economic Possibilities for our Grandchildren. Somehow, we got caught up in a mad spiral of ever-increasing consumption, rather than adequacy; probably stimulated by all the devilish skills of marketing and sales playing on humans’ natural desires and acquisitiveness; with all the consequences for planet, society and mental health that we now see.
Thanks
What we clearly need is some proper ‘workforce planning’ which clearly includes when people ‘retire’ and flexible working for all ages
Agreed
Linda Evans raises the idea of different retirement ages for different jobs… when I worked in Warsaw in 1999 I remember some (not all) of my young upwardly mobile Citibank students supporting the government getting rid of early retirement for miners. Allegedly because it was more fair if everyone retired at the same age, but my impression was it was part of their wholesale acceptance of destructive neoliberal fictions about the desirability of cutting welfare spending. If I remember correctly it would have meant that very many miners would not draw their pension at all because they died before pension age and many more would be extremely ill for the whole of their short retirement. I think they managed to protest this and stop it happening but I can’t remember for sure…