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Persuading Europeans to work more hours misses the point

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Persuading Europeans to work more hours misses the point

Europeans are spending less time at work, and governments would like them to get back to the grindstone. That is the thrust of measures German, Dutch and British ministers have been examining to persuade part-timers to take on more hours, and full-timers to embrace overtime.

But the evidence suggests it will be an uphill battle — and that authorities worrying about a shrinking workforce would do better to help people who might otherwise not want a job at all to work a little.

Rising prosperity is the main reason the working week has shortened over time, as higher productivity and wages have allowed people to afford more leisure. In Germany, for example, it has roughly halved between 1870 and 2000. Across the OECD, people are working about 50 fewer hours each year on average than in 2010, at 1,752.

Average hours have fallen more in recent years because the mix of people in employment has changed, with more young people studying, more mothers working, older people phasing their retirement and flexible service sector jobs replacing roles in the long-hours manufacturing industry.

The latest post-pandemic drop in European working hours is more of a puzzle. The European Central Bank estimated that at the end of 2023, Eurozone employees were on average working five hours less per quarter than before 2020 — equivalent to the loss of 2mn full-time workers.

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There has been a similar shift in the UK, where average weekly hours are 20 minutes shorter than in 2019 at the end of 2022. The Office for National Statistics says this was driven by lower full-time hours among prime-age men and was equivalent to having 310,000 fewer people in employment.

The trend appears to be a European one — there has been no such recent change seen in the US, which simply laid people off during the pandemic rather than putting them on furlough.

One explanation is that employers have been “hoarding” labour — keeping staff on in slack periods while cutting hours, because they are worried they will not be able to hire easily when demand picks up. The ECB thinks this has been a factor, along with a rise in sick leave and rapid growth in public sector jobs.

But Megan Greene, a BoE policymaker, said earlier this month that while there was some evidence of labour hoarding, it was also “plausible that . . . workers may just want a better work-life balance”.

Researchers at the IMF who examined the puzzle reached a similar conclusion. They said the post-Covid drop in working hours was in fact an extension of the long-term trend seen over the past 20 years, which reflected workers’ preferences — with young people and fathers of young children driving the decline. The biggest change was in countries where incomes were catching up with richer neighbours.

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Some economists, however, believe the experience of lockdowns has made people more willing to trade pay for a less pressured lifestyle, and more able to walk away from jobs with antisocial hours.

“A lot of people started to pay more attention to their health,” said one Frankfurt-based economist, noting that Germany, with one of the sharpest drops in working hours, suffered from high rates of depression and other mental health conditions, along with the UK.

Spain has traditionally been at the other extreme. It has some of the longest working hours in Europe — combined with a long lunch break that means many employees cannot clock off till late in the evening, with family life, leisure and sleep patterns all suffering as a result.  

But even here, habits are changing. Ignacio de la Torre, chief economist at Madrid-based investment bank Arcano Partners, thinks Spanish bars and restaurants have struggled to fill vacancies since the pandemic because former waiters have begun training for better jobs.

In many countries, unions have made shorter hours a focus of collective bargaining, and some employers are experimenting with offering four-day weeks — or more flexible working patterns — as a way of attracting staff.

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The shift in habits is a challenge for European policymakers. Since productivity growth has been weak, they fear that shorter hours will exacerbate labour shortages, fuel inflationary pressures, hold back growth and make it harder to fund welfare systems.

Unless productivity growth improves, de la Torre argues, the only way to boost economic growth is to bring more people into the workforce, embrace immigration or work longer. It is unrealistic to earn the same while working less: the outcome would be “a lower salary at the end of the month”.

But Anna Ginès i Fabrellas, director of the Labor Studies Institute at the Esade law school, cites evidence that young people are willing to accept this trade-off, valuing free time “when they assess the quality of a job”.

Some policymakers think shorter hours and greater wellbeing should be the goal. Spain’s minister of labour, Yolanda Díaz, caused uproar earlier this year by suggesting restaurants should no longer open into the small hours, and the governing coalition has pledged gradual cuts to the legal maximum working week.

The IMF’s researchers made a more pragmatic argument.

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Governments can and should do more to help people who want longer hours, they said, including supporting retraining, job-hunting and childcare, as well as promoting flexible work and removing perverse incentives in tax and benefit systems.

This will have only a small effect, the IMF estimates. Some policies will simply “reshuffle hours” between mothers and fathers. But in general, most people will want to work slightly less provided their living standards advance. That means there’s a limit to what policymakers can do. 

A more realistic goal, the IMF reckons, is to raise the total number of hours worked across the economy, not least through better parental leave policies that could bring more people into work in the first place. Recent trends in the EU are promising: participation in the workforce has risen since 2020.

This feels like the better approach. If employers offer better part-time and flexible roles, people who might otherwise stay outside the labour force entirely might at least work a little — and be happier for it. That would be more productive for governments than pushing against the tide.

delphine.strauss@ft.com

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Macron’s party at risk of wipeout, say election projections

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Macron’s party at risk of wipeout, say election projections

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President Emmanuel Macron’s centrist alliance could be facing a wipeout in snap parliamentary elections after France’s leftwing parties struck a unity pact.

New projections suggested only around 40 of Macron’s MPs would qualify for the second round vote on July 7, in run-off races that would predominantly be fought between candidates fielded by the far right or the leftwing bloc for the 589-strong assembly, according to two studies for Le Figaro and BFM TV.

The findings suggest Macron’s gamble to dissolve parliament and hold early elections in the hope of stopping the rise of the far-right Rassemblement National party could backfire badly.

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They also underscore how the outcome of the two-round vote on June 30 and July 7 could be determined by the left.

Four normally fractious left-wing parties on Thursday night struck a deal to run as an alliance, with an agreement on candidates and a joint programme. It was endorsed by former president François Hollande, a socialist.

The accord did not specify who would be their candidate for prime minister. Jean-Luc Mélenchon, leader of the far-left France Insoumise (France Unbowed, LFI) party and a deeply polarising figure in French politics, hinted earlier on Thursday that he wanted to the job.

LFI secured the largest proportion of candidates on the joint list with the centre-left, Socialists, Greens, and Communists.

If the left parties had ran multiple candidates for each seat, Macron’s centrist alliance would have had better chances of piercing through to the second round. To qualify for a run-off, a candidate needs to have won the backing of 12.5 per cent of registered voters.

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By extrapolating results from last week’s European parliamentary election to the upcoming first round in the French legislative poll, RN would come first in 362 seats and the left would come top in 211, according to Le Figaro’s calculations.

Some analysts cautioned against extrapolating from European parliament elections, which take place in a single round according to proportional representation. They often have low turnout and are used as a protest vote against the government.

Mathieu Gallard, a pollster at Ipsos, said predicting seat share at this stage was “just a matter of intuition”. Candidates have not yet been selected and incumbent MPs often command considerable local loyalty. Margins of error for voting intentions across two rounds, the close contests in many constituencies and doubts over turnout made the “outcome highly uncertain at this stage”.

Still, the forecasts add to a series of gloomy surveys for Macron’s camp this week, suggesting they could lose at least half of their 250 seats in the assembly.

Asked about the difficult poll numbers, an adviser to Macron’s alliance said: “There is a narrow path forward, and we’ll see how dynamics shift in the coming days. It is hard but not impossible.”

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An Elabe poll for BFM and La Tribune Dimanche put the RN on 31 per cent (with 4 for the rival far-right party Reconquête), the leftwing alliance on 28 per cent, Macron’s centrist alliance on 18 per cent and the centre-right Les Républicains on 6.5 per cent.

The adviser said the 18 per cent for Macron’s alliance suggested it had new momentum after Sunday’s European vote, when it scored 15 per cent. The adviser pointed to polling showing that almost two-thirds of the French public supported Macron’s decision to dissolve parliament.

Elabe projects the RN winning between 220 and 270 seats, the left 150-190 and Macron’s alliance 90-130. The centre right would take 30-40.

The opinion polls this week suggest the mostly likely scenario is a hung parliament, but if the RN wins by a big margin, it will have a claim on the office of prime minister and the right to form a government.

Video: Why the far right is surging in Europe | FT Film
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Phoenix police have a pattern of violating civil rights, Justice Dept. report says

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Phoenix police have a pattern of violating civil rights, Justice Dept. report says

Darrell Kriplean, president of the Phoenix Law Enforcement Association, which represents about 2,200 Phoenix officers, stands at a lectern with microphones to take a question during a news conference Thursday in Phoenix. A Justice Department report said Phoenix police discriminate against Black, Hispanic and Native American people, unlawfully detain homeless people and use excessive force, including unjustified deadly force.

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PHOENIX — Phoenix police discriminate against Black, Hispanic and Native American people, unlawfully detain homeless people and use excessive force, including unjustified deadly force, according to a sweeping federal civil rights investigation of law enforcement in the nation’s fifth-largest city.

The U.S. Justice Department report released Thursday says investigators found stark racial disparities in how officers in the Phoenix Police Department enforce certain laws, including low-level drug and traffic offenses. Investigators found that Phoenix officers shoot at people who do not pose an imminent threat, fire their weapons after any threat has been eliminated, and routinely delay medical care for people injured in encounters with officers.

The report does not mention whether the federal government is pursuing a court-enforced reform plan known as a consent decree — an often costly and lengthy process — but a Justice Department official told reporters that in similar cases that method has been used to carry out reforms.

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Phoenix police didn’t immediately comment on the report, referring questions to the city. But a top police union official called the Justice Department investigation a “farce,” and warned that a consent decree would hurt officer morale.

“The Department of Justice is not interested in making local police departments and the communities they serve better,” said Darrell Kriplean, president of the Phoenix Law Enforcement Association, which represents about 2,200 officers. “This action demonstrates that they are only interested in removing control of local police from the communities that they serve through consent decrees.”

Phoenix Mayor Kate Gallego said in a statement that city officials would meet June 25 to get legal advice and discuss next steps.

“I will carefully and thoroughly review the findings before making further comment,” she said.

Attorney General Merrick Garland called the report “an important step toward accountability and transparency.” He said in an email that it underscores the department’s commitment to “meaningful reform that protects the civil rights and safety of Phoenix residents and strengthens police-community trust.”

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‘Overwhelming statistical evidence’ of disparities due to discrimination

The Justice Department said Phoenix officers enforce certain laws — such as low-level drug and traffic offenses, loitering and trespassing — more harshly against Black, Hispanic and Native American people than against white people who engage in the same conduct.

Black people in the city are over 3.5 times more likely than white people, for example, to be cited or arrested for not signaling before turning, the report says. Hispanic drivers are more than 50% more likely than white drivers to be cited or arrested for speeding near school zone cameras. And Native American people are more than 44 times more likely than white people — on a per capita basis — to be cited or arrested for possessing and consuming alcohol.

Officers investigating drug-related offenses also were 27% more likely to release white people in 30 minutes or less, but Native Americans accused of the same offense were detained longer, the department said. And Native Americans were 14% more likely to be booked for trespass, while officers cited or released white people accused of the same offense.

There is “overwhelming statistical evidence” that the disparities are due to discrimination, the Justice Department said.

Assistant Attorney General Kristen Clarke, who leads the Justice Department’s Civil Rights Division, criticized Phoenix for “over-policing” homeless people, including arrests without reasonable suspicion of a crime. More than a third of the Phoenix Police Department’s misdemeanor arrests and citations were of homeless people, the report says. The DOJ investigation began in August 2021.

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Litigation is an option if the Justice Departments’ efforts to secure a consent decree are unsuccessful.

“We remain very hopeful that we can build on the track record of success that we have had in other jurisdictions across our country and put in place a consent decree that contains the strong medicine necessary to address the severe violations identified,” Clarke said.

Phoenix Police officers in helmets and face shields and holding large body shields labeled

Phoenix Police officers watch protesters rally on June 2, 2020, during demonstrations over the death of George Floyd.

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Similar DOJ investigations in Albuquerque, Baltimore and elsewhere have found systemic problems related to excessive force and civil rights violations, some resulting in costly consent decrees that have lasted for years.

In Phoenix, a 2020 case accusing 15 protesters of being in an anti-police gang was dismissed because there wasn’t credible evidence; in 2017, a “challenge coin” was circulated among officers depicting a gas mask-wearing demonstrator getting shot in the groin with a projectile; and in June 2019, cellphone video emerged showing officers pointing guns when they confronted an unarmed Black couple with two small children they suspected of shoplifting.

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Poder In Action, a Phoenix group that advocates for people of color and workers, said the findings were no surprise.

“We never needed a DOJ investigation to tell us this,” the group said in a statement. “The data and the stories from residents have been telling us this for years.”

The report said some police shootings happened because of officers’ “reckless tactics,” and that police “unreasonably delay” providing aid to people they have shot and use force against those who are unconscious or otherwise incapacitated.

In one instance, police waited more than nine minutes to provide aid to a woman whom officers had shot 10 times, the Justice Department said. The woman died.

The investigation zeroed in on the city’s 911 operations. Even though Phoenix has invested $15 million to send non-police responders to mental health calls, the city hasn’t given the 911 call-takers and dispatchers necessary training.

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Officers assume people with disabilities are dangerous and resort to force rather than de-escalation tactics, leading to force and criminal consequences for those with behavioral health disabilities, rather than finding them care, the Justice Department said.

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Tesla shareholders approve Elon Musk’s $56bn pay deal and Texas move

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Tesla shareholders approve Elon Musk’s $56bn pay deal and Texas move

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Tesla shareholders voted to reapprove chief executive Elon Musk’s $56bn pay and to reincorporate the electric-vehicle maker in Texas, handing him significant victories as he seeks to reassert control over the company.

The preliminary results, announced at Tesla’s annual meeting in Austin on Thursday, will strengthen the company’s hand as it attempts to overturn a January decision by a Delaware court to void the 2018 package of stock options — the largest in US history — due to concerns about its size and the independence of the board.

While the vote does not supersede the court’s decision, the ratification could prove instrumental in persuading the judge to reverse or amend her stance. Musk’s grip on the company would be tightened, boosting the chief executive’s stake to more than 20 per cent from his current 13 per cent.

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Musk and the board have for the past few months led a campaign to rally Tesla’s retail shareholders — who own about 30 per cent of the company — to back the two resolutions in what amounted to a referendum on the mercurial leadership of one of the world’s richest people.

They also lobbied institutional investors to go against the guidance of proxy advisers ISS and Glass Lewis, who opposed the “outsized” and “excessive” pay package.

Two of Musk’s crucial allies on the board were also re-elected despite opposition from proxy advisers: former 21st Century Fox chief executive James Murdoch and Musk’s brother Kimbal.

After the polls closed just after 4pm in Austin, Musk emerged on stage to address a rapturous crowd chanting his name, jumping up and down in front of a blue and pink neon sign in the shape of Texas advertising the “cyber roundup”, as its annual meeting is branded.

“Hot damn I love you guys,” Musk said to the carefully-selected audience of retail investors. “We have the most awesome shareholder base of any public company . . . we are not starting a new chapter, but opening a new book.”

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The victories were not unexpected after Musk posted on X on Wednesday night that both resolutions were “currently passing by wide margins!”

Tesla shares rose 3 per cent on Thursday after his post, but have fallen 27 per cent so far this year.

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