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Finland’s industrial and political sectors have given a mixed welcome to a government proposal that would see organisations rely more heavily on next-generation digital and artificial intelligence (AI) technologies, which could lead to a four-day working week.
The ministry of transport and communications, which is behind the plan, believes intelligent use of digital and AI technologies could be the catalyst to enable the labour market to move from a five-day, 40-hour working week to a four-day, 24-hour week.
The ministry has initiated an informal consultation process with employers’ groups and opposition political parties. Feedback is also being sought from leading IT and tech corporations Nokia and Tieto.
“If we look at how digitisation and AI are changing our lives, changing how products are made and sold and how society functions, then we should have a strong degree of confidence that, taken together, technological advances and productivity improvements have the potential to make shorter workdays a possibility in the future,” said Sanna Marin, Finland’s transport and communications minister.
Marin’s proposal has stirred up a national debate on government forward planning to accommodate the significant impact that new technologies will have on the national economy, industrial output, the labour market and society at large.
“New technologies, and the greater use of technologies to manufacture goods and services, have been the main driver in reducing working time over the past 100 years,” said the minister. “In each decade, technology has contributed to increasing labour productivity. Some may argue that it sounds utopian and unfeasible to make a living on four-day working weeks or six-hour working days. That said, the same fears were expressed about the transition to a five-day working week and an eight-hour working day in the past.”
The ministry is studying a range of productivity-focused schemes in Finland and Sweden, where positive outcomes have been documented from reducing working hours. Marin said preliminary results from these initiatives indicates that productivity can increase when working hours are shortened.
In fact, linking productivity gains to reduced working hours in business and industry is not new to Finland. In the mid-1990s, industry groups Nokia Tyres and KWH Pipes conducted a series of pilot trials that registered productivity improvements of 33% and 42%, respectively. In each case, unit labour costs either remained unchanged or fell as a result of the trial.
“Productivity gains mean companies will have no problems paying an eight-hour wage for six hours of work,” said Marin.
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But the ministry’s plan is somewhat at odds with the conclusions of productivity-related analysis from some of Finland’s leading think-tanks. ETLA, an economic research institute funded by employers, has rejected the entire basis for Marin’s proposal, countering that increases in working hours, rather than cuts, remain the most effective tools to measure and bolster competitiveness.
“The reduced working hours proposals mooted by minister Marin are completely unrealistic,” said Antti Kauhanen, ETLA’s research director. “If you cut working hours by lowering monthly earnings so that hourly earnings remain unchanged, you create fewer jobs and worsen employment prospects. Finland needs measures to increase the amount of work, both from policy-makers and from labour market organisations.”
In recent years, Finland has become something of a testbed for innovative and tech-driven labour market reform schemes. The Finnish government launched a Basic Income Scheme (BIS) pilot in 2017. Under the scheme, 2,000 randomly selected unemployed people received a monthly payment from the state of €560. The stipend was paid regardless of whether participants were receiving other forms of income or looking for work.
Preliminary results from the two-year BIS, which ended in spring 2019, concluded that although the scheme did not spur unemployed recipients to work more to supplement their earnings, it did improve their wellbeing and sense of confidence in their future employment and career opportunities. The Finnish government is currently awaiting final results from the BIS trial before deciding whether to implement the scheme, in part or whole, into a reformed social security system.
The ministry of transport and communications is looking at how the BIS, and its reduced working week proposal, could work within a new social security system model that was reconstructed to utilise more digital and AI technology to drive administrative and management systems.
Marin’s department is playing an increasingly important role as technology innovator within Finland’s conservative-left government. It is moving forward with initiatives to develop and deliver digital solutions that support more efficient transport and mobility systems.
Pushing digital agenda
Finland is forcefully pushing this digital agenda during its six-month rotating presidency of the European Union (EU). The ministry’s four core interconnected issues that are being elevated at EU level are digital transport services, safe automation, carbon-free transport and data economy.
Finland wants to accelerate efforts to achieve greater returns from the more effective use of data in digital transport services and automation, said Marin.
“Digitisation of transport is an important opportunity for Europe’s sustainable growth,” she said. “We must make full use of the opportunities digital transformation is opening up for us. Finland’s motto in our presidency, in the transport and communications sphere, is ‘Smart connections for sustainable growth’. This embodies the coming-together of transport and communications services in the digital era.”
But employers remain cautious about the plan for a shorter working week, while trade union chiefs fear the concept could further erode their diminishing role in the labour market.
Despite reservations, opposition parties have welcomed the ministry’s decision to trigger a national debate on a technology-enabled shortened work week, said Antti Kurvinen, chairman of the Centre Party’s Parliamentary Group.
“It’s a topic that is worth discussing in the fast-paced, technology-led digital age we live in,” he said. “However, rather than reducing the working week and working hours, Finland will be better served by maintaining the status quo.
“We need to reap the full benefits of boosting productivity and competitiveness through smarter use of digital and AI. We must focus more on promoting employment and entrepreneurship.”