Overall working time must increase to ensure future economic growth
Ippubblikat: 27 June 1999
An analysis conducted by the Danish Employers' Confederation (Dansk Arbejdsgiverforening, DA), of the development of the total labour market participation rate in Denmark since 1950, has prompted the organisation to conclude that Danish GDP could have been much higher than it is today. The analysis is contained in DA's annual labour market report for 1999 [1].[1] http://www.da.dk/nyhed/amrap99/samfat99/index.htm
Average working time in Denmark has been reduced during the past 50 years, while the labour market participation rate over the same period has increased sufficiently to create only a slight growth in GDP. It will therefore be necessary in future to increase the number of working hours or the participation rate in order to ensure continued economic growth, concludes the DA employers' confederation in its annual labour market report for 1999.
An analysis conducted by the Danish Employers' Confederation (Dansk Arbejdsgiverforening, DA), of the development of the total labour market participation rate in Denmark since 1950, has prompted the organisation to conclude that Danish GDP could have been much higher than it is today. The analysis is contained in DA's annual labour market report for 1999.
The average working week for a person employed full time in Denmark fell from 48 hours in 1950 to 37 hours in 1997, while at the same time, annual holidays increased from two to five weeks. This corresponds to an approximate 30% overall fall in the number of working hours in the private sector. At the same time, the total number of hours worked in the public sector has more than trebled, says DA. This is due to an increase in the number of employees in the sector.
Between 1950 and 1998, an extra 600,000 people obtained employment. According to DA, since 1960 this growth in the workforce, seen in isolation, has increased economic growth by 0.7% annually. However, it is claimed that this growth has almost been swallowed up by the continuing reductions in the average number of working hours, which during the same period have reduced economic growth by 0.6% annually. Since 1950 the total number of hours worked has fallen by 9% because the average number of working hours has been reduced so dramatically.
DA's point of departure is that increased production creates increased welfare. A larger workforce could have made higher production possible and thereby provided better public services and a lower tax burden. If the labour market participation rate and the number of working hours are not increased in the future, the overall amount of employment will fall in coming decades, which DA concludes could mean lower economic growth.
Il-Eurofound jirrakkomanda li din il-pubblikazzjoni tiġi kkwotata kif ġej.
Eurofound (1999), Overall working time must increase to ensure future economic growth, article.
