Could a four-day week actually be better for business?

Working a four-day week without a drop in pay. It’s like a beating drum that’s been becoming progressively louder in recent years. But is it something Australian businesses want to hear? And after the upheaval Covid-19 brought to the way we work, should they be listening? 

What is clear after the pandemic is that working from home has brought many employees greater flexibility and a healthier work-life balance than they had ever experienced before. Something they are increasingly reluctant to give up. And while ‘the great resignation’ hasn’t affected the Australian workforce as much as other countries like the US, we are suffering from a talent shortage. So, could a 4-day week be the game-changer your business needs for attracting, and retaining, the best candidates?

While a number of Australian businesses are trying to encourage people back into the office, many leaders have accepted, reluctantly or otherwise, that a hybrid work environment is now the norm. Yet, in many cases, they still see the 4-day work week as a bridge too far.

Is a four-day working week such a novel idea?

While Australia seems to have trouble with the concept, four-day weeks and flexible hours are common in Scandinavian and Northern European countries, where there tends to be a greater concern for the effects of long working hours on people’s well-being. 
Naturally, how feasible a four-day week is depends on the type of work and industry you’re in. An IT specialist may find it easier to work flexibly, than someone in construction or education, for example.  Yet it’s worth remembering that around the turn of the last century, a five-day week was also considered novel. But before the first decade was out, five-day work weeks were quickly becoming the norm.

Less hours, more productivity – a contradictory success story

Loss of productivity is probably the biggest concern for businesses. Yet trials around the world and across different industries have shown that productivity is often not affected and, in many cases, actually improves with a four-day week. The consistency of these results is surprising, despite trials taking place in countries with diverse workplace cultures, such as Japan, Spain and Canada, and in businesses as diverse as Unilever and Microsoft.

In recent times, the majority of these trials have been led by 4 Day Week Global, a not-for-profit coalition of business leaders, community strategists, work designers, and advocacy thought-leaders.

Started by Andrew Barnes and Charlotte Lockhart, owners of New Zealand-based company, Perpetual Guardian, after they successfully trialled then permanently implemented a four-day week, 4 Day Week Global’s mission is to help other businesses and their employees gain the same benefits through online advice and guidance. 

For them, a four-day week is not about having an extra day off. It is about delivering more productivity and meeting customer service standards, while also delivering on personal and team business goals and objectives more efficiently and sustainably.  There is mounting evidence that improving performance by working less is not as contradictory as it seems. Studies show that employees working six-hour workdays are just as productive as those who spend eight or more hours in the office. Increasingly, the proof is there that less is more.

Shifting focus from hours to output

Adopting a four-day work week for the same pay depends on individual targets set by employers. Trying to fit 35 hours of work into four days while keeping the same productivity and targets will only lead to burnout. Instead of being concerned about hours, employees should be judged on overall performance and output. While different approaches are called for, the four-day week trial results are often the same: unchanged or even increased productivity and a happier, more stable workforce. Changing the focus from hours to output, Edinburgh-based food and drink marketing agency, Lux, began trialling a four-day work week in 2020. An alternate shift pattern was put in place, with some people working Monday to Thursday, while others worked Tuesday to Friday. Time-tracking software used to measure productivity found that despite working fewer hours, the company was actually making more profit. Since starting the trial, profits have risen 30% and productivity is up 24%, and the four-day week is now a permanent feature.

The cultural shifts that could drive change

There are a number of cultural shifts underway that could see a four-day week in Australia slowly starting to find its way into the workplace. Up until the pandemic, Australia’s working culture had placed the ‘workaholic’ high on a pedestal, despite the country’s reputation as a laid-back and generally relaxed place. In many circles, being a workaholic and advocating ‘hustle culture’ had become somewhat of a humble brag. As Karin Sanders, Professor in the School of Management and Governance at UNSW Business School, notes: “The stereotype in most industries is that if you go down in hours, people think that you are not ambitious, are not going for promotion, and are not committed to the company. So, employers will believe that moving to a four-day work week is a signal of not being committed”. But the pandemic has produced a shift in that culture.

Fortune favours the flexible

Now that employees have had a taste of a healthier work-life balance and more flexible working arrangements, their expectations from employers and the way we work have changed. Australian businesses may find it harder to ignore the benefits of a four-day week as they lose valuable employees to jobs that offer the balance they’re looking for. With around 20 trials in industries from finance to fashion currently underway in Australia and New Zealand alone, those work opportunities are only going to increase.  

Professor Sanders believes that just as remote working varies considerably around the world, depending on technology adoption, culture and industries, so will the adoption of a four-day work week. Whatever your stance on the concept, the reality is that workers are now looking for more flexibility from their employers, and employers who can adapt to the new world of work will attract top-tier talent.