Sunday, July 08, 2007

Work less (and save the environment)

Most arguments for working less are related to work-life balance. Spending more time for personal needs (e.g. hobbies, social life) or family.

A report, titled Are Shorter Work Hours Good for the Environment?, from the Center of Economic and Policy Research, however, put a different spin on the issue. The report analyzes the impact of working hours to the environment. Specifically, the report compares energy consumption between U.S. and Europe.

Among the analysis made in the report, one interesting figure is average hours worked per civilian employees in 2003 (table 2). In this table, the most "workalohic" country is Turkey with 1929 hours. The U.S. is 1817 hours, while the "Old Europe" (EU-15) countries work on average 1562 hours in 2003.

If we assume 2 weeks public holiday and 4 weeks annual (and sick) leave, there are 46 working weeks in a year. That means the Turkish worked on average 42 hours a week, while the Americans and the Old-Europeans worked 39.5 and 34 hours per week. Japanese, with 1760 hours, worked for 38 hours per week on average.

Geez, that looks good! I'm not sure about other Asian countries, but it seems we (or I) put more and more hours every week. I'll be happy to settle with 50 hours a week.

Or I can also support the Work Less Party, whose objective is 32 hour work week.

Ironically, I post this blog from my cubicle, on Sunday afternoon. (this is the first time, though, and I hope it's also the last time I post a blog from work.)

But seriously, we have to consider the impact of what we do to the environment, and most importantly to the future. We probably should be less capitalistic and be a bit more of a global citizen.

The questions remain - what's the economic impact to the individuals for working less (or more)? What's the marginal income rate at certain work hours? How much do we value other activities or time spent with family, or a greener earth for that matter?

By the way, how many hours do you work in an average week? Mine is around 55, a bit more in the past several months.

* EU-15 countries are Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United Kingdom.


Conclusion (taken from the report):

If Americans chose to take advantage of their high level of productivity by shortening the workweek or taking longer vacations rather than producing more, there would follow a number of benefits. Specifically, if the U.S. followed the EU-15 in terms of work hours, then:
* Employed workers would find themselves with seven additional weeks of time off.
* The United States would consume some 20 percent less energy.
* If a 20 percent energy savings had been directly translated into lower carbon emissions, then the U.S. would have emitted 3 percent less carbon dioxide in 2002 than it did in 1990.9 This level of emissions is only 4 percent above the negotiated target of the Kyoto Protocol.

On the flip side, there is political pressure within European countries to adopt a more American labor model. If Europeans did in fact give up their shorter workweeks and longer vacations, they would consume some additional 25 percent more energy. Translated into carbon emissions, this would have enormous consequences for those countries that have signed and ratified the Kyoto Protocol. Over 1990 levels, the EU-15 emitted 8 percent more carbon dioxide in 2002, despite a clear commitment to reduce emissions to 8 percent below 1990 levels by 2008-12. Thus, the EU-15 must cut emissions by 14 percent from 2002 levels. However, if EU-15 workers had consumed 25 percent more energy and consequently emitted 25 percent more carbon dioxide in 2002, they would have had to cut emissions by more than one-third from that level to meet their commitment to Kyoto.

According to the IPCC Third Assessment Report, the amount of global warming is tied to the speed by which emissions are cut. If by 2050 the world is emitting 10Gt (10 billion metric tons) of carbon, we may be on a path to 2.5 degrees Celsius of warming. On the other hand, if the level of emissions is 14Gt of carbon dioxide in 2050 may mean 4.5 degrees of warming. A worldwide choice of American work hours over European levels could result in 1 to 2 degrees Celsius of additional warming, in addition to higher fuel prices.

Finally, the debate over the European and American models, depending on the extent to which either side prevails, will have economic and environmental implications for a number of middle-income countries. These countries – especially the fast-growing economies of Asia – will most likely choose between these two models of labor market institutions and consumption. South Korea and Taiwan are already at European levels of GDP per capita. China (at $8,004 per person) is still far behind but is growing rapidly and is the second largest economy in the world in absolute size,12 and at current growth rates will pass the United States in less than a decade. The American model is still portrayed throughout the international business press as the one to emulate. The environmental consequences of developing countries’ choices could be very serious.