Why Greeks are overworked while Germans go home early

A Madrid think tank called the Institute of Economic Studies (IEE, in Spanish) recently released the kind of provocative study meant to incite debate. Based on data from the OECD, it noted that workers in struggling Southern European countries like Greece, Spain, Italy, and Portugal put in far more hours per year than their Protestant work-ethic-infused counterparts in Northern countries like Germany and the Netherlands. Southern Europeans may have been suffering through an economic crisis, the IEE seemed to be saying, but they weren’t lazy.

“We work more hours, for example, than in Germany, the U.K., and the other so-called northern countries. But working more hours doesn’t mean that things come out better for us,” said Almudena Semur, IEE’s manager.

Greek workers put in 2,034 hours per year, and those in Spain, Italy, and Portugal worked around the OECD average of 1,765. In the North, however, German workers only managed to put in 1,397 hours, the Dutch 1,381, and Norwegians 1,420.

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The numbers offer a picture of the dual realities of European labor, and the markedly different responses to the financial crisis by employers in Southern and Northern Europe.

“If we talk of before the crisis, we see that the level of employment in Spain and Germany was more or less equal,” said Alfredo Pastor, a professor of economics at Barcelona’s IESE Business School. “In the crisis, what was most adjusted in Germany was hours worked, while in Spain it was the number of employees.”

In a paper from the Institute for the Study of Labor (IZA, in German) in Bonn, “Short-Time Work: The German Answer to the Great Recession,” the authors noted that while Germany’s GDP fell by 4.7% in 2009, the size of its working population remained at a record high because short-time work regulations, which offered wage supplements for those who suffered temporary work-hour reductions, helped companies avoid layoffs. Without the wide use of “short-time” work (
Kurzarbeit
, in German) unemployment in Germany would have risen by about twice as much as it did, the authors said.

“What the Germans tend to do is reduce hours worked and wait for a good day. And the good days have come back quite quickly. In Spain, that’s another story,” says Pascal Marianna, a labor economist at the OECD in Paris.

Many Northern European countries have also been making a long-standing push to increase the level of part-time work to help worker and business flexibility and to increase the participation of women in the workforce. In 2012, the percentage of workers working part-time was 22% in Germany, 38% in the Netherlands, and only 14% in Spain, according to OECD data.

“In Germany, during the last decade we have seen a major increase in part-time work, especially among women,” says the OECD’s Marianna. According to Marianna, the employment rate of women in Germany increased from 58% to 68% between 2000 and 2012.

And then, of course, there is the issue of productivity. According to OECD statistics, the GDP per hour worked in Germany, the Netherlands, and Norway were $58, $60, and $87, respectively, while in Greece, Portugal, Italy, and Spain, the numbers ranged from $34 to $50.

For IESE economics professor Pastor, the solution is obvious: Make Spain’s rigid and long siesta-split workday more flexible, and push more part-time work.

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“The work hours in Spain are very irrational. In Spain, we reward people who are at work many hours,” he says. “Without a doubt, it’s better to promote part-time work.”

At the end of the day, the IEE put out its findings to show that while Spain was near the OECD average and handily beat Germany in terms of hours worked per worker, that in itself was little to celebrate.

“What we have to do, in order to make our businesses more competitive, is to work better,” IEE manager Almudena Semur said. “Working more doesn’t help if you don’t work better.”