Good News: Working Less Leads to Greater Productivity!

Women considering yes, no, maybe optionsby Justin Grensing, Esq., MBA


The results of a recent experiment by Microsoft Japan lend additional weight to previous real-world data showing significant gains in productivity by—wait for it—working less!.

The company found that shifting to a four-day workweek resulted in productivity gains of 40 percent. While this correlation might sound counterintuitive at first glance, it’s easy to understand the direction of the impact when taking a closer look at productivity; although the size of the impact is still impressive. For context, the biggest jump in national year-over-year productivity in the United States going back to 1949 was about 10 percent with other cyclical peaks usually ranging somewhere between three and 5 percent. There have been some dips of negative productivity growth, but those are relatively rare.

Overview of Productivity

Regardless of the industry, productivity is a crucial metric for any business. A company that is more productive can theoretically create more of a product or service and generate more revenue – assuming, of course, a demand for that product or service. This is why companies are constantly looking for ways to boost productivity. These efforts include anything from process improvements and employee training to investments in new technologies.

Investopedia provides the following definition of productivity at the microeconomic (i.e., individual business) level:

At the corporate level, where productivity is a measure of the efficiency of a company’s production process, it is calculated by measuring the number of units produced relative to employee labor hours or by measuring a company’s net sales relative to employee labor hours.

More With Less

The key to this definition is the section that says, “number of units produced relative to employee labor hours.” [emphasis added]. So what Microsoft Japan and others have found is not necessarily that working fewer hours generates a greater overall output, but that working fewer hours generates a greater level of output per hour worked. But in the case of Microsoft Japan, while we don’t have all of the company’s detailed data, overall output must have increased as well, based on the numbers they have provided.

According to Microsoft, productivity (output per hour) increased by 40 percent after reducing hours worked by 20 percent (from five workdays down to four). If workers were previously producing 100 units of Whatever per hour, they would have produced 4,000 per week, assuming a 40-hour workweek. Based on a 40-percent increase in productivity, employees should now be producing 140 units of Whatever per hour. In a 32-hour workweek that comes to 4,480 units per week, an overall increase of 12 percent.

Additional Benefits

Microsoft Japan’s benefits didn’t stop at productivity, however. Imagine how much a big company can save in overhead by being in the office only four days per week instead of five. In this case, for example, the company found that it reduced the number of pages printed by nearly 60 percent and saw a 23 percent drop in energy consumption. And, of course, the employees like the new schedule too.

You can draw your own conclusions about why working fewer days or hours per week has resulted in greater productivity and overall output for Microsoft Japan. An obvious possibility is that workers who are better rested and less stressed are more productive when they are at work. Regardless of the underlying cause, it’s impressive to see a major company initiative that has been able to increase output, reduce costs and boost employee satisfaction all at once.

Could you, or your staff members, be working less and doing more?

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