Working Hours Essay

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Working hours refers to the time spent by individuals in paid market work. Differences in working hours across populations arise from difference in the share of individuals that are employed (the extensive margin) and the number of hours worked by each employed individual (the intensive margin). Over recent decades in industrialized nations, average hours of work per person have tended to rise. The increase in average working hours has been the result of growth in the share of the population employed, particularly the rise in women’s rates of employment. The number of hours worked per employee has changed less, and in some nations, average hours of work per employee have declined.

Average annual working hours in the United States at present exceed those in European countries by about 50 percent. This is a relatively recent development. In the early 1970s, western Europeans worked more on average than Americans. Since then, the increase in employment rates in the United States has outpaced that in western Europe, and American working hours have significantly overtaken those in Europe. The productivity per hour of American workers remains similar to that of European workers. Much of the explanation for the greater per capita output of the United States compared to many European workers therefore lies in the greater number of hours worked per year by Americans.

Changes Over Time

In the United States, average weekly hours worked per person declined about five or six hours per week on average over the 20th century. Hours worked per worker declined more, about 16 hours per week, but this was offset by an increase in the rate of employment. Most of the decline in the hours worked per person has been concentrated among the young and the old, with the hours worked per person of prime-age individuals (those between 25 and 54 years of age) remaining roughly constant from 1900 to the present.

Despite the decline in the average hours worked by those employed in the United States, the notion of “overwork” arises frequently in popular and academic discourse, for example, in Juliet Shor’s widely cited book The Overworked American. One possible explanation is the growing share of dual-earner and single-parent families. In the United States, the share of couples in which both husband and wife work rose from roughly one-third in 1970 to more than half by the year 2000. Single-parent and dual-earner families with children are more likely to experience challenges in balancing the demands of work against those of family.

In recent decades, the average hours worked by men has declined while the average hours worked by women has risen. A growing share of men is opting for earlier retirement. This, along with an increase in education levels, which delays men’s entrance into the labor force, has reduced the hours that men work over the life span. Women, on the other hand, have increased their working hours over the life span. Women’s labor force participation rates rose steadily over the course of the 20th century. The increase in the labor force participation rates of married women has been particularly marked since 1960.

Factors Affecting Working Hours

Several factors contribute to the difference in working hours across nations and individuals. Higher wages increase the incentive to work. Real wages in the United States, for example, increased roughly nine fold over the 20th century. While some economists, such as Keynes, predicted that increases in wages and productivity would enable individuals to increase their leisure time, it appears that despite higher hourly wages, Americans do not choose to significantly reduce their time spent in paid employment.

Higher marginal income tax rates are thought to decrease the incentive to participate in paid work and are cited as one explanation for lower hours of work in Europe relative to the United States. Retirement benefit policies have a significant effect on decisions regarding employment. National policies regarding vacation time and hours of work, such as the French 35-hour week, contribute to cross-country difference in working hours. Unionization and consequent regulations regarding pay and hours of work impact working hours. The presence of children as well as child care policies have a significant impact on employment rates, particularly among women. Education levels affect time in employment, with higher education levels associated with longer working hours.

 

Bibliography:

  1. Tito Boeri, Michael C. Burda, Francis Kramarz, and Pierre Cahuc, Working Hours and Job Sharing in the EU and USA: Are Europeans Lazy? or Americans Crazy? (Oxford University Press, 2008);
  2. Orsetta Causa, Explaining Differences in Hours Worked among OECD Countries: An Empirical Analysis (OECD, 2008);
  3. Coleman and J. Pencavel, “Changes in Workhours of Male Employees, 1940–1988,” Industrial and Labor Relations Review (v.46/2, 1993);
  4. Coleman and J. Pencavel, “Trends in Market Work Behavior of Women Since 1940,” Industrial and Labor Relations Review (v.46/4, 1993);
  5. Institute of Directors, Flexible Working: The New World of Work, IoD Policy Paper (Institute of Directors, 2008);
  6. Jacobs and K. Gerson, “Overworked Individuals or Overworked Families?: Explaining Trends in Work, Leisure, and Family Time,” Work and Occupations (v.28/1, 2001);
  7. McGrattan and R. Rogerson, “Changes in Hours Worked Since 1950,” Federal Reserve Bank of Minneapolis Quarterly Review (v.22/1, 1998);
  8. Kim Miller, Fred Danner, and Ruth Staten, “Relationship of Work Hours with Selected Health Behaviors and Academic Progress among a College Student Cohort,” Journal of American College Health (v.56/6, 2008);
  9. Paull, “Children and Women’s Hours of Work,” The Economic Journal (February 2008);
  10. Prescott, “Why Do Americans Work So Much More Than Europeans?” Federal Reserve Bank of Minneapolis Quarterly Review (v.28/1, 2004);
  11. Henry Saffer and Karine Lamiraud, The Effect of Hours of Work on Social Interaction (National Bureau of Economic Research, 2008).

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