Policy proposals like the four-day workweek have gained momentum in the aftermath of the Covid recession, raising the question of how many hours people would choose to work. This column uses survey data to establish people’s willingness to pay for additional leisure time in terms of forgone earnings, and vice versa. The findings suggest that many workers in Germany and the UK would happily pay for more leisure and that, thanks to productivity gains, tighter hours caps might bring net positive welfare effects even after accounting for a smaller tax base and reduced capital returns.
How much time people work is shaped by a variety of constraints. Some of these are explicit regulations, while others reflect long-standing customs and habits; still others reflect technological and organisational forces. Either way, it appears fair to posit that few people are truly free to choose how much exactly they would like to work on their job.
A natural question, then, is how hours worked (Boppart 2016) contrast with hours wanted, or desired hours worked. The resulting answer can inform discussions on a shorter workweek that are taking place in numerous countries. Policy proposals like the four-day workweek have gained momentum in the aftermath of the Covid recession and have led to various trials aimed at curbing working hours.
Our paper (Jarosch et al. 2025) demonstrates how the evidence on desired hours can inform the policy debates on a shorter workweek. We use survey data that directly elicit desired hours on an individual’s current job – under the hypothetical scenario that earnings would move up or down in proportion to hours worked. In other words, the survey respondents report desired hours recognising that they would ‘pay’ for any additional leisure time in terms of forgone earnings, and vice versa. We contrast the resulting willingness to pay calculations from the workers’ side with several costs and externalities that lower work hours might induce.
Empirical evidence on overwork
Through the lens of the desired hours question, European workers appear overworked: they report a desire to work fewer hours than they do. American workers, in contrast, report a preference for more hours than they currently work. In German data spanning nearly four decades, more than two-thirds of full-time workers consistently wish to reduce their hours, with the mean gap between desired and actual hours hovering around five hours per week. Similar patterns emerge in UK data. Figure 1 illustrates this pattern for German full-time workers in 2019.
Figure 1 Hours worked and hours wanted in Germany
Notes: Panel A shows the cumulative distribution of usual hours worked (red) and desired hours (blue) for full-time workers in Germany in 2019. Workers report what hours they would desire if their earnings changed proportionally with hours. Panel B shows the distribution of the difference between desired and actual hours at the individual level. More than two-thirds of workers prefer fewer hours than they currently work, while fewer than 10% want more hours. Source: SOEP.
The trend for overwork is pervasive across demographic groups but displays meaningful patterns. Women report larger gaps than men, middle-aged workers larger gaps than their younger or older counterparts, and white-collar workers larger gaps than blue-collar workers. High-income workers demonstrate particularly large hours gaps, with those earning around €5,000 monthly reporting weekly gaps exceeding eight hours – far more than those with lower earnings.
Welfare cost of overwork
These patterns suggest possible welfare gains from tighter weekly hours caps. We use a simple, static model of labour supply (MaCurdy 1981) to assess the welfare cost of both the observed and counterfactual hours gaps via willingness-to-pay calculations. The welfare cost of the observed misalignment between desired and actual hours amounts to approximately €28 per worker per week in Germany, or roughly 1.2% of GDP. We then assess policies that tighten hours caps.
Specifically, our counterfactual analysis examines the welfare effects of gradually reducing the weekly hours cap from the current German legal limit of 48 hours per week. Figure 2 presents the average willingness-to-pay for different hours caps under three alternative implementation scenarios. 1
Figure 2 Average willingness to pay for a shorter workweek
Notes: Mean willingness-to-pay (in 2015 euros per worker per week) in 2019 for a workweek capped between 30 and 48 hours under three different implementation scenarios.
Source: Analysis of SOEP dataset.
Across all scenarios, the optimal length of the workweek in Germany would be 37 hours. The welfare gains from such a policy would range from €12.5 to €23.5 per worker per week. Importantly, even a 32-hour workweek (effectively, a four-day week) would still yield positive welfare gains compared to the status quo in all scenarios.
The gains from such a policy are particularly pronounced for women, college-educated workers, those in the middle of their careers, and high earners. This last point suggests that policies that tighten hours caps have a regressive flavour.
Productivity implications and resource feasibility of a shorter workweek
A basic premise of this exercise is that reducing hours and earnings in proportion is resource-feasible. The empirical relationship between hours and wages in the cross-section in Germany suggests this is sensible, as it peaks at 34-36 hours and declines thereafter. This pattern suggests that the counterfactual allocations where workers reduce hours from current levels could actually increase hourly productivity, an observation that aligns with recent research showing that productivity often increases when working hours are reduced (Shangguan 2021, Cette 2023). When we incorporate this empirical hours-wage relationship into our welfare calculations, the net gains from a 36-hour workweek increase substantially, potentially reaching 3.6% of GDP.
Our analysis also considers external effects of reduced working hours that are particularly relevant for policy. When aggregate hours fall, both tax revenue and the returns to capital fall along. We calculate that if hourly productivity remains unchanged as hours fall, the external losses could outweigh the direct worker benefits for hours caps below 43 hours. In this scenario, a shorter workweek would still deliver large gains to workers, but in a redistributive fashion, at the cost of capital owners and tax and transfer recipients. However, the empirical hours-wage relationship suggests productivity improvements that more than offset these external losses, yielding net positive welfare effects even after accounting for a smaller tax base and reduced capital returns.
Cross-country heterogeneity
Importantly, the overwork phenomenon in Europe contrasts sharply with American workers’ preferences. Figure 3 illustrates this international difference in desired versus actual hours. This transatlantic divide in hours preferences parallels the well-documented gap in actual hours worked between Europe and the US (Bick 2016).
Figure 3 Overwork and underwork over time in different countries
Notes: Panels show the fraction of full-time workers in each country reporting a preference for fewer hours (green), same hours (orange), and more hours (blue) over time. Data come from the SOEP for Germany, BHPS for the UK, and CPS/RTP for the US. The stark contrast between European and American workers highlights important cross-country differences in labour market institutions and preferences.
Source: Analysis of SOEP, BHPS, CPS, and RTP datasets (Jarosch et al. 2025).
Conclusion
Our approach towards identifying over- or underwork, and hence a role for changes in hours regulation, is extremely simple. It basically just asks workers how much they want to work, recognising that more leisure comes with a (about proportionate) cost. Our findings suggest that many workers in Germany (and the UK) would happily pay for more leisure and that, consequently, tighter hours caps might bring welfare gains.
Source : VOXeu
