France's 35-Hour Week Has Done Its Job
France's famous 35-hour workweek is in its death throes: Bloomberg News reports that an increasing number of companies are using the country's timid labor reform, introduced this year, to get around the requirement. It doesn't mean the experiment failed, but it has probably outlived its usefulness.
President Francois Hollande is a socialist and wouldn't want to go down in history as the undertaker of the popular 35-hour norm, introduced in 2000 by another socialist government at a time the economy was expanding. At one point last year, Economy Minister Emmanuel Macron, a former investment banker, mentioned extending the workweek, but he was quickly silenced; his subsequent legislative effort to make the French labor market more flexible skirted the issue.
Even so, Hollande seems to recognize that the French economy can't now afford a short workweek and has made it possible for companies to negotiate temporary increases in working hours to prevent the loss of jobs. Daimler, the German automaker, is using that opportunity to scrap the 35-hour week at the French factory where it makes the little Smart car models.
It's more democratic and less disruptive to leave the length of the workweek to employers and labor unions to agree, than to dictate it by law. That's how it works in Germany, where the maximum length of the workweek is 48 hours, with the option to extend it temporarily to 60. At the same time, metalworkers have successfully bargained for a 35-hour week. So there's nothing wrong with France retreating from its customary statism to give companies and workers more discretion to negotiate.
Indeed, French white-collar workers have never had to comply with the weekly norm: Their contracts are based on a fixed number of working days, not hours. Only about a third of the French workforce actually adheres to a 35-hour week. There may be a lot of irritating bureaucracy in the French system, but there's also plenty of flexibility.
That explains why, according to Eurostat, fully employed French people actually work 40.5 hours per week. It's an hour less than Germans or European Union citizens on average, but more than an hour longer than Norwegians.
The rationale behind the 35-hour week was that work would be more evenly shared and unemployment would go down. The French jobless rate did fall, by 15 percent, in 2000 and 2001, but academics can't agree if this was caused by the legislative change or the relatively healthy economic growth with which it coincided. The actual number of hours worked by a full-time employee dropped briefly, but then went back to its previous level. Unemployment, meanwhile, went back up as soon as economic conditions worsened.
So one might wonder why France should keep a rule that doesn't have a discernible economic effect and can, in any case, be bypassed.
The political answer is that French voters have consistently supported the 35-hour week. So now that the government has recognized the law might be bad for the economy, it prefers to let labor unions negotiate work duration with employers, rather than risk a backlash by killing the law outright.
The economic rationale may have to do with the workload readjustment that took place after the 35-hour law came into effect. One-third of employees -- mainly white-collar ones, whose work hours were not established by the law -- reported an increased workload and more stress.
They must have dealt with that rather effectively. Around the time France was phasing in the 35-hour workweek, its labor productivity (expressed in euros per hour worked on the chart below) increased faster than average for what is now the euro area.
France is still one of the world's most productive economies, ahead of Germany, the U.K. and most other European countries, but others are catching up. If the 35-hour workweek forced the more-skilled part of the French workforce to figure out how to increase efficiency after the less-skilled got a break on workweek length, that effect has now leveled out.
There is probably no longer any need to keep the 35-hour week law on the books. It has helped lower-income women in France find more time for their families, it may have contributed to cutting unemployment at some point, and it may have shifted some of the work burden to people who were able to dispatch it more rationally. It has, however, failed to establish a universal social norm as strong as the five-day, 40-hour week. The nature of work is changing and, as Steffen Lehndorff of the University of Duisburg-Essen put it in a 2014 paper on the French experiment, "working-time standards need to be rooted in agreements within companies and at workplaces, but equally within millions of households, which may include a wide array of gender-specific working-times over the life course of individuals."
There is, however, no reason to rush the 35-hour week's abolition, either. If it's allowed to erode gradually, as the new system of agreements Lehndorff described takes hold, it won't slow down the French economy much.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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