New Week, New Headlines: 4-Day Work Week Totally Works & We're In a Productivity Boom Ya'll

Welcome to the last week of February, Friends!

There were two news stories this week that give us hope (like, a lot of hope) for the future.  Check it out:

Topic 1: The 4-Day Work Week Totally Works
We've got the latest scoop on a landmark study analyzing the UK's four-day work week pilot, which could signal a sea change for how we approach the grind. We reviewed Autonomy's study of "Making it Stick: The UK Four-Day Work Pilot. Year One". The data's painting a picture of a win-win: energized employees and robust organizational growth.  Is it here to stick? 

Topic 2: We're in a Productivity Boom, Ya'll!
1994 was the last time the US experienced a productivity boom - increasing the economic pie and changing how work worked. Are we here again? We check out the New York Times article that questions if the quarter-over-quarter productivity increases are putting us in another productivity boom.  

Disclaimer: This podcast is for informational purposes only and should not be considered professional advice. We are not responsible for any losses, damages, or liabilities that may arise from the use of this podcast. The views expressed in this podcast may not be those of the host or the management.

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Transcript

Francesca : 0:00

Think about 1994, mel, because 1994 was an amazing year for things like hip-hop, the Toyota Land Cruiser and other things. Mel, what were you doing in 1994?

Mel: 0:11

Well, 1994, I remember being in my high school library watching the OJ trial while taking a quiz to use the internet.

Francesca : 0:20

Dude, we had to watch the OJ trial too. I had to use a sophomore U geometry class.

Mel: 0:24

I'm kidding. Why were we watching the OJ trial?

Francesca : 0:29

Well with my future. This is a core memory.

Mel: 0:47

Hey friend, Welcome to your work. Friends, I'm Mel and I'm Brigitte and we're your two HR friends with no filter getting you through all the work shit. How's it going, Jessica?

Francesca : 0:59

Good, it's good. Got a little case of the shin splints for the first time in 15 years.

Mel: 1:03

Oh yeah.

Francesca : 1:04

We got Lucy, our new dog, which is awesome she's two years old and rad. Oh, she's a boxer and she's super cuddly and she's super athletic, and so we've been trying to really make sure she gets exercise. I'm not a runner. I've always wanted to be a runner. I've had these visions of myself as a runner and I fucking hate running. I just do. I love to walk. I'll walk all day every day. I'll fast walk all day every day. But running not my thing. Yeah, she's got me fast walk running, so we're here.

Mel: 1:33

Yeah, that's okay, it's cool. When I was playing sports in college, what we used to do is fill those paper cups for bathrooms for like mouthwash.

Francesca : 1:41

Oh yeah, fill them up with water. A little dixie cups. Yeah, a little dixie.

Mel: 1:44

Yeah, throw them in the freezer, fill them with water and then you just cut it off and like, rub that on your shins, rub that in.

Francesca : 1:50

Oh, they have these.

Mel: 1:51

Yeah, a little tip and trick, that's it, that's it, and fast walking is the best exercise for you. Yeah, how's your weekend? It was good. My best friend of almost 40 years. Our birthdays are two weeks apart. We always try to do something fun together every year, and this year we hopped on the train to the city and went to the color factory, which is yeah, what is that?

Mel: 2:15

Art installation in Manhattan and it's like an immersive play experience, like you go through all these different scenarios, walking through the colors, all the colors that exist, like with smell and sight and sound, and it was just really great. We got to be kids again. We were the only two middle-aged women without children In the occasion, but we didn't care. We went down the slide, went into the ball pit, ate some ice cream, had some macarons, played along, did a silent dance party. It was all fun times. That sounds like the perfect day.

Francesca : 2:48

It was great. It was like the perfect day. It was great.

Mel: 2:50

Today's New Week, new headlines. What are you talking about?

Francesca : 2:54

I am talking about. Are we in a productivity boom? For clues, look to 1994. This was New York Times article that came out to see are we in for a rad productivity boom? Want to talk about what that means for the economy and, more importantly, what that might mean for workers. What are you talking?

Mel: 3:12

about? I am talking about the four day work week A new study came out. Yeah, following up on the study that came out last year from that UK pilot. It's a follow-up to the maintenance phase of how things are going and want to share the results with folks.

Francesca : 3:29

Nice, nice. Well, it's a fourth day work week. I want to hear it.

Mel: 3:35

It's exciting. So the title of this study is making it stick the UK four day work week pilot. One year on, and we'll link to this in the show notes. But I read a newsletter that goes out every week. It's called Talent Edge Weekly. Highly recommend it for folks. You can find it on LinkedIn and they shared this research, which was conducted by Autonomy. Autonomy is an independent research organization that creates data-driven tools and research for sustainable economic planning, and they partnered with the University of Cambridge, the University of Salford, the University College of Dublin and Boston College for this study. Good schools, no slouches on this Pretty significant research team. So, for some context, in 2022, the UK did a pilot of the four day work week. You heard about that, right.

Francesca : 4:29

Oh yeah, the Marquis experiment.

Mel: 4:32

Yeah, the largest of its kind. It launched in 2022. And in February of last year, 2023, results were published about the pilot. It was successful and what they found is that the vast majority of organizations who participated in the pilot have kept that policy in place after the pilot so now they're in maintenance mode. So this study is focusing on that 96% of the folks that have kept that policy in place and who are maintaining it one year on from 2023.

Francesca : 5:06

I cannot wait to hear.

Mel: 5:08

It's good stuff. Of the 61 organizations that took part in the 2022, a UK four day pilot, 54 confirmed they're still operating that policy. One year later, 31 of those organizations have made the policy permanent. So 51% of people who have moved on to keep it going are making it permanent. It's no longer. It's not like a continued pilot, it's done. Yep, we're keeping this now. That's more than half. That's pretty amazing.

Mel: 5:38

100% of managers and CEOs who were consulted said that the four day work week had a positive or very positive impact on their organization. Yeah, 100%. Changes included staff well-being 82% increase positive effects on reducing staff turnover. That was a 50%. 50% of them said there were positive effects to that. And then noticeable improvements on recruitment. So getting the right talent in your doors 32% said that's a good thing. Attrition and recruiting alone huge well-being. No brainer Like you should take care of your people, so it's a no brainer. They conducted a survey with 47 of the original pilot organizations and found that improvements to physical and mental health, work life balance and general life satisfaction so expanded lives, including reductions in burnout have all been maintained a year on from the original pilot.

Francesca : 6:37

Because you would think maybe some people would just get used to it and this becomes the new norm. But to have that sustained sense and actualness, if you will, of well-being is huge. That's a big deal.

Mel: 6:51

It is a big deal yeah.

Mel: 6:54

Especially when you know how things go from pilot to maintenance phase. It's the change management. It's harder to maintain than to pilot when the buzz wears off and it becomes part of the daily norms. And no surprise. Their findings found that change management and cultural norm changes are what lead to the success of this program. So to maintain the success of the program, Oryx noted they had to revise things like meetings, communications, work prioritization. Not everything's an emergency, folks, In order to make this work. Not everything should be a meeting. Are we meeting with purpose or can this be an email sort of thing? And in organizations where the additional day off was only weekly guaranteed meeting, W-E-A-K.

Francesca : 7:40

A lot. It's not strong, not a norm.

Mel: 7:42

Yeah, where it's suggested, or I'm assuming maybe some leaders were like all for it and some were just like you do it, you don't do it thing. So in instances where this took place, it just led to staff having concerns about taking the day and so they didn't believe in the policy, or the policy just didn't work. It doesn't work when organizations don't fully commit or if they mandate that certain conditions be met in order to get this benefit.

Francesca : 8:13

It's a thing that I find so interesting about days off, or even vacation, is people need to feel like they have permission to walk away from their jobs. That are okay for you to not answer email. It's okay for you to not finish a blah, blah, blah. That is your day off. Even if other people are working, that is your day off.

Mel: 8:34

Yeah, and just setting boundaries. But that starts at the top right. Yes, absolutely, because if you think of a team leader sending emails at 10 pm, then your team thinks they need to answer at 10 pm. So really being that's one small example, but when you're making a huge shift like this, it's critical to look at the cultural norms and see what needs to be addressed. Most participating organizations implemented a straightforward four-day work policy with a full day off every week, and you and I have been in organizations where you've had collective disconnects. It works really well because everyone's off at the same time, so there's not that level of guilt that happens to the Glate. And then other organizations did more of a staggered approach the day off essentially staggering days off to ensure that there was always five days of coverage happening within the org. And so what they found in their sample is that the universal or staggered day off models had the highest success rates. 95% of companies who implemented one of those models for the trial have since made the policy permanent. So disconnect, collective disconnect and staggered work.

Francesca : 9:41

Makes sense because A your business isn't losing 20% of their coverage. I know that was always the concern for a lot of businesses like, oh my gosh, what are we going to do if a client calls or someone needs to be on for XYZ? That's number one and number two to your very good point. If they've done the change management, if they've done the norm setting where someone who happens to have their day off on a Wednesday while everyone else is working feels like they can take it off, then yeah, that's a win.

Mel: 10:08

Right, they get to do what they want with their time. The future of this is looking bright and I like it. I'm excited for it. So what they found is that 58% of the public expects the four-day work week to be the standard way of working by 2030, compared to only 22% who think it will not. And look, we just heard that Gen Z stat last week they want greater flexibility. That's what their that indeed workforce report. Right, they're looking for greater flexibility. When you think of who's the future of our workforce Gen Z and millennials and zennials right, where everyone's wanting that greater flexibility and that hybrid option, I think we're going to see a big push in that direction In May of 2023,.

Mel: 10:54

A study found that 78% of UK workers want a four-day work week and 52% are actively seeking a four-day work week as part of employment. So where folks are looking to see if things are hybrid or work from home they're also adding this to the list Do they offer a four-day work week? And the four-day work week has also become a key demand in trade union negotiations in countries like the US, germany and Italy. So the future is this. I really believe it. I'm going to call. I'm just going to put myself out there and say, yes, this is the right direction to go in. The pilot of the four-day work week is multiplying around the globe. The autonomy. The folks who put this report out noted that as of early 2024, there are 152 official four-day work week employers accredited by the four-day week campaign in the UK, which is a 32% increase in just one year.

Francesca : 11:54

The thing that is so beautiful about this time is you can institute a four-day work week now without having any negative impacts on your business. We have the tools, we have the technology, we know what it takes from a process perspective. Thanks to this type of pilot, it's absolutely possible. That's number one. The other thing, and why I absolutely agree with you by 2030 is gonna happen is I'm hearing three day work week, like when I was hearing four day work week, like six years ago, and everyone's now now I'm starting to hear a three day work week, especially with AI.

Mel: 12:31

Especially with AI, and I'm here for it. I think, look, life is not about working. Life is about living, works, the cherry on top and meaningful work right, and so I think, just moving in this to the direction of more meaningful work, I think AI is gonna help us get there. I'm super excited about the four day work week. We'll include in the show notes a link to the study. Part of the study included use cases for several of the organizations who've had success. Share it with your leaders. If you're someone who has the power to recommend something to your board or to your leadership team to pilot, maybe pilot with a specific business unit, maybe two to three different business units. See how it works out. Try different approaches for each. See how this might work for your organization. I think this is gonna move you in the right direction and if you think about attractive workplaces of the future, they're gonna have this as part of the way they work. This is their cultural norm.

Francesca : 13:28

When let's talk productivity, baby yeah, it's fascinating times, just fascinating times we're living in. New York Times this week came out with this article Are we In A Productivity Boom? For Clues, look to 1994. And they're drawing parallels between what's happening with productivity numbers on an aggregate Now feels very similar to what happened in 1994. And I wanna talk about why that matters and some of the parallels they're drawing. It's a very fun story and I also think it's fun to just think about 1994, mel, because 1994 was an amazing year for things like hip-hop, the Toyota, land Cruiser and other things. Mel, what were you doing in 1994?

Mel: 14:12

Well, 1994. I remember being in my high school library watching the OJ trial while taking a quiz to use the internet.

Francesca : 14:21

Dude, we had to watch the OJ trial too. I had to. It was a sophomore Ugeometry class Fun kids.

Mel: 14:27

why were we watching the OJ trial in school?

Francesca : 14:30

With our teacher. This is a core memory. What?

Mel: 14:36

Quite literally watching the chase and taking a quiz on what's a mouse? What does WWW stand for? I passed by the way I got to use the interwebs.

Francesca : 14:46

How do you Mel?

Mel: 14:47

I'm proud of you and look at where you are now right.

Francesca : 14:49

So far See Stay in school. Kids Shout out to Scarfo.

Mel: 14:53

Thank you.

Francesca : 14:55

I wonder what she's doing now. Anyhow, yeah, listen, 1994. Interesting year. But there's a lot of parallels that we can draw between 1994 and now because, to your very good point, 1994, this is where we started seeing World Wide Web, internet, connected computing, which really put it in this productivity boom. We haven't seen something like that since. But here's the deal, friends Productivity has grown more than 3% for three consecutive quarters, according to the US Bureau of Labor Statistics.

Francesca : 15:28

Oh, wow, a lot of economists are like hold up, aren't we in a 1994 situation? Again, interesting. Why should you give a shit about this? Let's first talk about what the hell productivity is. I want to talk about why it matters and really call out two of the parallels that they're making. Sounds fabulous. So what is productivity? Great question. Productivity in the workplace refers to how much work is done over a specific period of time or, from an economic perspective, it measures output per unit of input. Now, that can be an hour of work or works, it can be machinery, et cetera, or the most part. The more productive you are, the better, because when productivity goes up without hours going up, it means you're more efficient.

Francesca : 16:13

You're more effective, and so what's been happening over the last three quarters is we're not working more hours, but our productivity is going up, and it's going up significantly. Yes, you may be asking is that a good thing? What does that mean? Here's the deal Increasing productivity is a virtuous cycle, and it's a virtuous cycle for the economy. It's a virtuous cycle for individuals as well, because when productivity goes up, the economic pie gets larger, and McKinsey has a really interesting study on US productivity that they just released, I believe on February 16th. I'll post it in this show notes. But here's the stat I want everyone to noodle on around productivity Again, we went up 3% over the last three quarters. They're saying long-term productivity growth rate of 2.2% annually, a $10 trillion opportunity in US GDP between now and 2030. And, on average, every individual household in America would get a $15,000 increase in wages. Oh, wow.

Mel: 17:25

It's a huge that can be life-changing for people.

Francesca : 17:28

Yes, and this is what they're talking about. When productivity goes through the roof like this economic pie gets bigger Everyone wins. Everyone wins. For the most part, everyone wins. There's always winners and losers in all of this game, of course.

Francesca : 17:42

But when you think about the very big places where productivity boomed industrial revolution 1994 with the computer age and now we're getting into this AI age and this is what a lot of economists are watching A lot of folks think we are here again because A productivity keeps on going up and keeps on going up. This is very similar to 1994. And we also have a lot of data points to say this is very feasible because we're looking at things like new technologies, like AI could be driving this. The embrace of hybrid work setups could be driving this as well. Okay, some parallels just pull this story home the computer age versus zoom age. So when you think about what was happening with interconnected computers in 1994, a lot of people weren't even working out in the laptops- no, I remember gosh.

Mel: 18:34

Think about emails getting rid of interoffice memos. Aol was still going strong AOL like chat. Yeah, think about that what that meant for business. I was just excited and have to write my papers on typewriter or word processor anymore. That was the reality.

Francesca : 18:53

From a business perspective, the gains you would get from having connected computing things like email, huge gains Because people had to do interoffice mail or faxing as opposed to emailing.

Francesca : 19:06

The speed of business got very strong. Parallel here is zoom and with hybrid work. Listen, there are a lot of debates on remote versus hybrid. That's actually not what's driving the productivity. What they're finding. What's driving the productivity now is the job flexibility. Yep, With hybrid work, employers are happier and they are saving productivity on not having so much term. I believe that I think that's a job right. We're not burning time on retraining people, and remote work could also allow companies to either offshore more tedious work so folks stateside have more dynamic work, and or push that off to AI. So those are the things that are driving productivity Remote and hybrid work. Zoom is enabling us to work in a more productive way. Lift here, Yep. The last one I want to unpack here is Internet versus Artificial Intelligence. You learned what WWW stands for Not even used anymore.

Mel: 20:05

I know, I know.

Francesca : 20:07

Everyone was like no WWW. But listen, the World Wide Web and efficient computer manufacturing, increased information technology, and it accounted for two thirds of that productivity pickup in 1994. Holy shit, it was huge, huge yeah. In turn, a lot of economists are looking at is AI going to do the same thing? Yeah, probably yeah. So again we are on the precipice here. Now. The article mentions a lot of other parallels too. Has the potential to have massive impacts for workers, from a wage perspective, from a what are you even doing in your dailiness if we all start to realize the benefits of things like AI and hybrid work, what your work life could, going to your four-day work week story? This is how this stuff happens and I also want to share that. Friends, this is a long game because the same stuff was happening in 1994 and it took economists until 1999 to 2000 to realize what was happening. We're in the early stages here, but it feels like a very interesting parallel to watch. Watch those productivity numbers.

Mel: 21:24

Think about Amazon as a use case. You remember shopping on Amazon in the early days in the 90s For books, for books only Books, college books that you can get for cheap on their janky ass site, yeah, and I was like, what is this? That I can buy books on this site? And it was so sketchy and you're like, all right, what it is today is just unreal because of the power of technology. I think with AI, we're headed in a very similar direction, and it takes businesses a little bit of time to figure out.

Francesca : 21:53

what do we do? How?

Mel: 21:54

does it work for us? Yeah, how?

Francesca : 21:55

does it work for us? But what the data is showing us is we're figuring it out.

Mel: 22:05

We have several interesting guest speakers joining us over the next few months, including some special guests in March. So stay tuned for that, and if you have something you want to share and you want us to cover, just send us a note. We'd like to cover it, yeah.

Francesca : 22:21

We'll be back next week with new week, new headlines. Thanks so much for joining us today. Like and subscribe. Wherever you listen to podcasts, you can come over and say hi to us. On the tiktoks and LinkedIn community. It is up at yourworkfriendscom. We're always posting stuff on there and if you found this episode helpful, share with your work friends. Thanks, friend, music.