The Workweek Reduction Equivalent: a measure of potential
Every quarter, government statisticians announce how much productivity
has been increasing. This is measured in GDP per hour worked. Because there
is no longer a correlation between income and individuals' satisfaction,
a more relevant statistic is called for.
The Workweek Reduction Equivalent uses the same data, but presents it
in a more meaningful way. It is the number of weekly hours that an
average full-time worker could reduce his workweek, if productivity
were applied to time rather than increased GDP.
For instance, output per hour in the US increased 4.5% in 2003, as
calculated by the US Bureau
of Labor Statistics. At an average workweek of 45 hours, the WRE is
2.0 hours - just for a single year. 2003 was higher than most years,
but the average recently has been 1.2 hours per year. Over even just a
decade, this really adds up.
This table shows productivity increase and WRE for recent years:
1996 2.8% 1.2 hours
1997 2.3% 1.0 hours
1998 2.6% 1.1 hours
1999 2.6% 1.1 hours
2000 3.0% 1.3 hours
2001 1.1% 0.5 hours
2002 4.8% 2.1 hours
2003 4.5% 2.0 hours
Of course, what productivity really measures is another issue - not all
increases in GDP are good - but, like other alternate economic measures
such as the 'Genuine Progress Indicator', the WRE could be a constant
reminder of our misplaced priorities.