Weak-willed Politicians' Promise of Three-day Weekend Doesn't Add Up

Knesset members' calls for shortening the workweek are sure to prove popular with workers - but they're completely divorced from the business reality.

Finance Minister Moshe Kahlon, March 30, 2016.
Ofer Vaknin

Israel used to have a finance minister. In those days, if a Knesset member proposed reducing the workweek and adding vacation days, the minister would have thrown him out. But today we don’t have a finance minister. Moshe Kahlon may be a housing minister or a charity minister, but he’s certainly not a finance minister.

He is the “I have money” minister. He’s in favor of good and populist things. Not harsh reforms or painful cuts. His entire thinking is how to give more, how to hand out more, how to “do something that benefits the people.” He is looking for public adoration, not looking out for the good of the economy. And when that’s the case, it’s clear that Kahlon will be in favor of turning Sunday into another day off – once a month for seven months, initially, but with the intention of eventually expanding it to every Sunday of the year.

The public loves it. As far as they’re concerned, they can work less and enjoy more leisure time, without earning any less money. But is that possible? Well, only in a populist nation like ours, one where the laws of economics are tossed aside in favor of worthless prattle.

MK Eli Cohen (Kulanu) is the sponsor of this idea. Cohen tells us the number of working hours in Israel is higher than the average in other Western nations. That’s true. But more important is the fact that productivity in Israel is about 25 percent lower than in those same countries – so their GDP per worker is higher, as is the per-capita GDP, standard of living and wages.

Enthusiastic supporters of the extra vacation idea should remember that, as soon as we give ourselves more days off, total output will drop still further, which will lead to a drop in wages.

True, the average workweek in the West is about 41 hours, while in Israel it is about 43 hours. But some important and developed countries work more hours than we do. For example, The Netherlands, Great Britain and Ireland all work an average of 48 hours a week, while in Switzerland they work 50 (!) hours a week – and the whole world wants to be Swiss.

Cohen deceives us when he says it’s an accepted practice not to work Sundays elsewhere. Of course this is true, but he neglects to mention the fact that Friday is a full workday elsewhere, while here it’s a day off for many. In other words, in the Western world they make do with two days off a week, but we should switch to three. That makes no sense whatsoever.

The manufacturers oppose the idea. They understand that another day off means less output, and if they want to run their factories on a Sunday, they’ll be forced to pay workers double time. That will damage their competitiveness, harm exports and raise prices. Even Roi Cohen, the president of Lahav (an umbrella organization of small businesses and self-employed workers), strongly opposes the initiative. You won’t find a proposal like this anywhere else in the world, he says, and the mooted additional 15 minutes per workday is a "farce.”

Simple math shows that the proposal to work another 15 minutes each day to compensate for the extra vacation time is not serious. It’s inadequate and also, due to the law of diminishing marginal productivity, this 15 minutes will have almost no effect on output. Worse, Avi Nissenkorn, chairman of the Histadrut labor federation, has already announced that he favors the Sunday vacation but is against adding the extra quarter hour: “We will steadfastly oppose lengthening the workday, and will not hesitate to declare a general labor dispute,” he says.

The bottom line is that those who would benefit most from this extra vacation are workers in the fat and swollen public sector, the municipalities and government offices, which will simply close their doors on Sundays and lower the level of service they provide to the private sector and general public. After all, no one measures their productivity.

Despite all this, if the proposal does reach the Knesset, it will win complete backing. After all, our legislature is terrifyingly populist. But why should we complain about the Knesset members? After all, Kahlon’s the one who should have taken the issue off the agenda. But to do that, he would have first needed to be appointed finance minister.