Saturday, October 22, 2016

Are American Workaholics Better Off Than Europeans? Absolutely Not!

 Workaholic Americans could take a lesson or two from the Europeans who refuse to live to work, opting instead to do the reverse .  A new study has measured precisely how much more Americans work than Europeans, overall. The answer: The average person in Europe works 19 percent less than the average person in the U.S. That’s about 258 fewer hours per year, or about an hour less each weekday. Another way to look at it: U.S. workers put in almost 25 percent more hours than Europeans.

The study was done by economists Alexander Bick of Arizona State University, Bettina Bruggemann of McMaster University in Ontario, and Nicola Fuchs-Schundeln of Goethe University Frankfurt.  One of the more unusual findings was that Swiss work habits were most similar to Americans’, while Italians are the least likely to be at work, putting in 29 percent fewer hours per year than Americans do.  The Swiss finding really isn't that mysterious given that Geneva and Switzerland itself was the springboard for Calvinism and its rigid work ethic.  (Much of which was also transported to the U.S.)

Is it any wonder then that with all the overwork (even more than the Swiss) we have a nation featuring twenty percent of citizens with moderate to severe mental disorders, nearly half of those suffering from explosive reaction syndrome, and another 5 percent with borderline personality disorder or paranoid psychosis? The latter who, when pushed to the limit,  blow up, kill fellow workers, or go berserk in other ways. As reported in one 2014 SciAm piece, after a survey of American workers, "half of the surveyed workers  confessed that they were reaching a breaking point after which they would not be able to accommodate the deluge of data."

Well, how about taking a vacation? A holiday? Time away from the damned job?  I mean real time, with no company connections, no email checking. And we're talking here of white collar workers on their electronic tethers in assorted information fields. What about the havoc in the lives of the rest of the overworked citizenry? Well, start with drug, opioid and alcohol addiction, then move on to neuroses and psychoses driven by overwork (50-60 hrs./ week)  and also (often) trying to be caretakers at the same time they meet the bosses' demands.  How do we know Americans are overworked to mental oblivion, apart from the actual hours put in?

- Over  $150 b "left on the table" each year in terms of unused vacation days

- 577 million unused vacation days each year

- 55 percent of vacation days that are taken always occur with office work taken along

WHY are Americans risking their mental health for the capitalist 0.001 percent? So the high fliers can eat even more foie gras and enjoy 18 holes on St. Kitts every month, as their wives lavish in rose wine wraps every day?  Of course, most workers will cite "fear" as the prime reason, meaning that if they take those days then they may likely return to find themselves without a job, never mind they might get ill from the added stress.

The  new study was designed to make it easier to compare countries to each other, by capturing the overall hours per person, not just for people with jobs. That incorporates not just the length of the typical workweek but also retirement, vacation, unemployment, and other time spent out of the workforce.

We also know not all time spent at the office, shop, or factory is time well spent. Output is also critical to the productivity equation, but difficult to quantify. Besides, let's not mince words, once you are in the work place you are being monitored by cameras every second you are there, whether you are a postal worker or a paper pusher. (In the latter case, keystrokes may also be measured per hour).  So it's not like you can just take 'five' every ten minutes without the boss catching on to you. In other words, if you have any sense you better be 'on' every minute you're at work.

Nevertheless, it’s important to have a reliable calculation of hours worked per person to accurately measure productivity, the amount of economic value nations get out of each hour their citizens spend working. The study’s detailed data could help researchers figure out why Americans toil so much longer than Europeans and which factors most influence productivity.

One theory is that Americans work longer hours because their additional effort is more likely to pay off. People earn a wider range of incomes in the U.S., so “workers have an incentive to try harder to move up the job ladder because a promotion is worth more,” according to Dora Gicheva, an economist at the University of North Carolina-Greensboro, citing a study that compared the U.S. with Germany.

But our long time German friends,  Reinhardt and Elli (see photo below), dispute that take.

Near Garmisch-Partenkirchen Germany in 2013.L-R: Me, Elli, Janice and Reinhardt

At the time we had discussions in May, 2013 with Reinhardt about the relative merits of the German and American work forces,  he'd been emphatic that the idea that promotions were "worth more" in the USA was nonsense. "Workers have just as great an incentive here in Germany", he said, because seniority is based on the quality of one's work and "that same seniority determines one's pension."  When I pressed him further he agreed that Germans aren't ruled 'by the buck' (or euro), "Jawohl, it is true that we do not consider the money to be the main determinant of our lives. We treasure time to be with family also to travel and see the world later on."

He did agree also that higher taxes are part of it and enable benefits like higher pensions, more widely distributed social insurance and child care provisions in Germany, as well as a less profit oriented healthcare system. He acknowledged that taxes in the U.S. are substantially lower than in Europe but made it clear that translated into more social benefits for Europeans. "It is interesting" he said, "but if Americans were willing to pay higher taxes they might have to pay less in healthcare costs because they could have a system more like ours, less based on profits!"

Too true!

Other studies have suggested that this higher tax burden reduces the incentive to earn more by putting in extra hours. According to Lee Ohanian, an economist at the University of California-Los Angeles.

Americans are indeed richer than Europeans, and one reason why is because of taxes that depress the incentives to work in Europe,”

But that depends on your definition of being "richer", i.e. whether in terms of time or money. Most of our European friends value wealth in time over money wealth. As our Czech friends Martin and Gabriella told us while we dined out in Prague: "You can't take the money with you. But time can provide you with the opportunity to make real social contacts and travel, enrich your family and your life."

Czech friends Martin and Gabrielle in Prague last summer. Each of them gets up to eight weeks off from their respective jobs.

Martin told us a large part of the more civilized holiday structure in Europe was due to the relatively stronger labor unions there, along with other worker protections.  As Gabrielle, Martin's gf,  put it: "Here in Europe the companies cannot work us to death or insanity like they do people in your country. That's why we can travel our continent for weeks at a time. Your countrymen would probably feel they have to check their cell phones or emails every day or twice or more a day!"

Their views appear to be supported. Economists at Harvard and Dartmouth concluded in a 2006 study that:

 “The data strongly suggest that labor regulation and unionization appear to be the dominant factors explaining the differences between the United States and Europe,”

Meanwhile our German friends Reinhardt and Elli both agreed that generous pensions in Europe are also a strong factor in discouraging older people from working. Compare Germany where very few citizens are still on the job to the U.S., with more people over 65 working than at any point in the past 50 years.

But don't ascribe that to a "desire" of elders to go out there and hoof it until their bones break. It's because Germans still retain a proper pension system, provided by their companies (like Reinhardt's architectural design firm - allowing him to leave work at 55). Meanwhile, U.S. companies have gone from the defined benefit plan to the 401k as an ostensible alternative. But this has always been absurd.

William Wolman and Anne Colamosca in their book 'The Great 401k Hoax', (2002),  assert that the 401k was never designed as an "investment" vehicle but as a purely savings medium. It was meant to salt your money away in safe, low risk abodes - while being matched by your company to some degree- and all the while sheltered from taxes. But almost from the start of the plan, named after the section in the tax code, workers were driven to put money into stocks, mainly equities, and other high risk instruments.  Little wonder, that small fry investors in 401ks have been fried and refried, over and over again. Under such conditions, the small investor risks his money and security.

Little wonder also, with this deplorable 'bait and switch' - elders have been forced to put the pedal to the metal longer and longer. (Which, btw, IS a bad thing because their  retention of jobs means less opportunity for younger workers.)  So make no mistake that the U.S.’s shift from traditional pensions to 401(k) plans made it harder for Americans to know when it was safe to retire. At the same time, the constant drumbeat of the financial media to "have at least $1 million" on hand, has postponed practical retirement for too many, which they could enjoy if they just had more realistic spending expectations. In Europe they do.

One thing is clear: The difference in hours worked between Americans and Europeans is more than a difference in cultures. As recently as the early 1970s, according to several studies, people in the U.S. and Western Europe worked about the same number of hours per week. So why the change in the U.S.?  Basically, because the twin phenomena of Neoliberalism and globalization in the U.S. eroded too much worker security.

Neoliberalism, arguing that citizens must not expect economic security (including from pensions and "entitlements") reared its ugly head in the 1980s. Most won't say it, but it was Neoliberal ideology that drove the impetus to withdraw the defined pension and offer the 401 k in its place. Enough of guaranteed retiree security at the hands of companies! Then in the 1990s the globalization aspect took hold with the signing of the NAFTA deal and we know where that's led. See e.g.

It is also the U.S. Neoliberal mind virus driving the demand to cut Social Security, just as it is Neoliberal economics which is using a false measure of inflation to cut retirees' Social Security COLAs - effectively translating into a significant Medicare premium hike for many. So no wonder many seniors have to go back to work.  But not Reinhardt! With his $8,000 euro/month pension he is free to pursue his many hobbies, including horticulture, as well as visit many different places with wife Elli.

Another American work aspect which galls both Martin and Reinhardt is the lack of off time for illness. In contrast to the European Union, which mandates 20 days of paid vacation (the Netherlands has 26), the U.S. has no federal laws guaranteeing paid time off, sick leave or even breaks for national holidays. This is disgusting! Or to use Reinhardt's phrase: "Shrecklich!"

Both were also nonplussed to learn that  a survey by Harris Interactive found that, at the end of 2012, Americans had an average of nine unused vacation days. And in several surveys Americans have admitted that they obsessively check and respond to e-mails from their colleagues or feel obliged to get some work done in between occasional swims, and going on a sightseeing junket.

Unfortunately, it is more likely most Americans will simply use the new study to justify their workaholism, as opposed to fighting it. While we need most average American workers putting their feet down and saying 'NO More!', the odds of that happening are about the same as Trump asserting he will accept the results of the election before Nov. 8th.  So we have to face the fact that most Americans would rather remain half-sick, mentally unstable worker drones than seize that precious commodity of time to anchor their lives and families. 

Alas, because of this misplaced value system, we can expect many more to come apart at the seams in the years ahead!

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