The Macroeconomics of Work Time

Abstract

In this paper we demonstrate that because of stagnating wages and rising job insecurity, there has been a change in the labor supply regime in the U.S. macroeconomy since the 1970s. There is now greater labor supply at any given officially measured unemployment rate. This induced growth in the quantity of labor effort is coming from experienced, incumbent workers and therefore does not show up in the official unemployment rate. While this may diminish family and community life, the increased aggregate labor supply means rising aggregate demand is being absorbed even at unemployment rates of less than 5 percent without sparking inflationary pressures. Because of this upward structural trend in weekly hours, monetary policy authorities must now recognize that standard jobless measures have become a misleading gauge of available labor.labor supply, working time, monetary policy, job insecurity, job instability,

Mismatches Between Actual and Preferred Work Time: Empirical Evidence of Hours Constraints in 21 Countries

“…One possible explanation for this relationship could be that, as Bell and Freeman (2001) propose, labour supply decisions are forward looking: people work longer hours to avoid being laid off during recessions. In the face of high unemployment rates especially, workers prefer additional work hours to layoffs and when future layoffs are anticipated, they seek additional earnings for income smoothing (see Bluestone and Rose 1998). Indeed, as Anger (2006) points out, when high unemployment rates impose a risk of future layoffs, even the willingness to work unpaid overtime is greater, and if workers expect to be under-or unemployed in the future, they are less likely to state a preference for fewer hours (Golden and Gebreselassie 2007, p. 19).…”

A Brief History of Long Work Time and the Contemporary Sources of Overwork

“…What is most clear is that the last few decades may be more accurately characterized as one of polarization of work hours or a time-divide (Bluestone and Rose, 1998;Drago, 2000;Jacobs and Gerson, 2004;Messenger, 2004). The share of employed men working 50 or more hours per week has been rising among highly educated, high-wage, salaried and older-aged workers (Drago et al, 2005;Epstein and Kalleberg, 2004;Kuhn and Lozano, 2006).…”

“…Among those who expect to be in managerial positions, there is a positive relationship between the number of work hours they prefer and the actual work hours of their co-workers (Brett and Stroh, 2003;Eastman, 1998;Feldman, 2002). There is also an incentive to put in extra hours of work to amass savings or serve a protective device against the risk of future job loss, demotion or pay cut, particularly if the extent of job or income insecurity is rising (Bluestone and Rose, 1998).…”

¿Queremos más o menos? Desencuentros entre las horas de trabajo que tenemos y las que preferimos en España, 2005-2014

“…The prior literature refers mostly to periods of economic growth, but there has been little research into the effects of recession on working time mismatches (Bell and Blanchflower 2011;Bluestone and Rose 1998). This study contributes to existing research about the ways in which the quality of work has been affected by the economic crisis.…”