Main Street Macro: The shrinking work week

Are you working fewer hours now than you did before the pandemic? If the answer is yes, you have a lot of company.

A new analysis from the ADP Research Institute finds that even though more people are working than ever before, hourly workers as a group are putting in less time. Here are three things you should know about the new time clock at work.

Why we’re interested in hours

Labor inputs to the economy rely not only on the number of people employed, but how much time those people devote to their jobs. The number of hours people work is related to how productive the economy is and how fast it can grow. 

In the last four years, we’ve seen new job opportunities that offer workers flexibility over their time. Historically high post-pandemic pay gains in some sectors gave people the opportunity to put in fewer hours without sacrificing income.

Employers, too, adjusted to a changing economy. For some, that meant cutting back on employee hours instead of cutting back on employees.

How we measured hours worked

Bureau of Labor Statistics surveys ask people how many hours they worked each week on average. But the data doesn’t say much about individual workers and how many hours they put in.

To learn more, we examined 13 million individual jobs that paid workers weekly or bi-weekly between October 2019 and December 2023. We measured average weekly hours worked within a given month for each job, then calculated the median of those observations.

What we found

Over the last four years, the median number of hours worked fell from 38.4 to 37.7 a week, a decline of almost 2 percent.

The people driving this decline in hours worked fall into four main groups: Women, young adults, highly paid workers, and employees at small businesses.

Though the unemployment rate is about the same as it was four years ago, a lot has changed. The pandemic affected the labor market in ways small and large, including how much people work.  We’ll be watching this data closely to see how it evolves.