Four-day workweek is 'backwards' economics, expert strategist claims
Bianco Research President Jim Bianco says a shortened workweek 'not exactly' what the US needs
Jim Bianco breaks down the economics of a four-day workweek
Bianco Research President Jim Bianco discusses the cost of employment and the economic impact of a four-day workweek.
In the post-pandemic world, there are growing calls from lawmakers, business leaders, and academics to switch from the traditional 40-hour workweek to a four-day workweek.
Maryland state lawmakers recently introduced a bill that would incentivize companies to switch to a four-day workweek, allowing employees to work 32 hours instead of 40 without losing any pay or benefits. The bill, however, was withdrawn earlier this week.
Two Maryland residents joined a "Making Money" town hall Thursday and raised their concerns about the economic consequences of the change from 40-hour workweeks to 32-hour workweeks.
"The economics of that are all backwards," Bianco Research President Jim Bianco said, responding to the Maryland residents' concerns.
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Although no longer up for consideration, the bill would have offered state subsidies to employers that want to make the change. Specifically, the Maryland Department of Labor would administer a five-year pilot program to study the possibility of a shorter work week without any reduction in pay. Companies that agree to participate by trying out a 32-hour workweek without reducing their full-time employees' weekly pay would be eligible for a state tax credit.
Bianco argued that the move will raise the cost of employment in an already difficult labor market and inflated economy.
"Basically, you're raising the cost of having an employee. If I'm going to have to work 32 hours as opposed to 40 hours, I'm going to have to hire more people to get the same amount of work done, which means you've made it more expensive," Bianco said.
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Other critics have questioned whether the cost-benefit analysis would be worth it for employers.
"Not every business is able to cut its work time while maintaining the same level of salaries," said Mary Elizabeth Elkordy, founder of the remote-based company Elkordy Global Strategies. "Companies need to produce the same level of work, so they may need to hire and train more people. Would the tax breaks offered be enough to cover these extra expenses? This could cause businesses to really sweat."
Elkordy explained a four-day workweek could work well for some businesses in certain areas, especially those with unconventional hours such as nurses or firefighters, but questioned its practicality in service-based industries where pay is directly tied to a person's time and output.
Research from Robert Half, an employment agency, shows a large majority of US managers support a four-day workweek for their team. The data also shows many expect their company to transition to one within the next five years.
Despite a majority favoring the trend, Bianco also raised concerns about how remote work factors into the economic concerns over the four-day workweek.
"The thing about remote work…is it's going to be next to impossible to try and measure a job in terms of hours because what's happening with remote work is we're measuring it in terms of tasks," he said.
"I need you to do X, Y, and Z. If it takes you 15 minutes or 10 hours to do it. That's up to you. So how do you measure that in a four-day versus five-day workweek?"
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Along with other developments in the modern work landscape, time will tell what impact changes like those proposed by the Maryland legislature will have. Nonetheless, economic experts like Bianco fear the cost a four-day workweek will have.
"In general, you're just raising the cost of employment. And that's not exactly what we want to do right now."
Fox News' Aaron Kliegman and FOX Business' Austin Westfall contributed to this report.