Most firms in the UK could afford to switch to a four-day (32 hour) working week, according to a new study.
The research by think tank Autonomy is based on profitability statistics on over 50,000 UK firms, with a simulation of best- and worst-case scenarios regarding profit rates under a sudden imposition of a four-day week.
It found that under the best-case scenario, a reduction in hours would be fully offset by increases in productivity and price increases.
Even under the worst-case scenario, a four-day week with no loss of pay would be affordable for most firms once the initial phase of the Covid-19 crisis has passed, it said.
However, the organisation warned that some firms in industries with high labour costs could experience cash flow problems if a four-day week was implemented too quickly.
The report recommends that the public sector should lead the way in adopting shorter working hours.
A shorter working week would boost wellbeing, improve productivity and give employees a much better work-life balance, according to Peter Dowd, Labour MP for Bootle and former Shadow Chief Secretary to the Treasury, who welcomed the findings of the study.
“For the large majority of firms, reducing working hours is an entirely realistic goal for the near future,” said Will Stronge, director of research at Autonomy.
“Any policy push will have to be carefully designed, and different strategies would need to be deployed for different industries,” he added. “However, what is remarkable is that if it happened overnight, with no planning, most firms would still remain profitable.
“The four-day week is picking up momentum across the world post Covid-19 and we’re calling on the government to begin investigating the best options for rolling it out.”