The Trade Union Congress (TUC) in the UK recently suggested that the advancements in Artificial Intelligence (AI), Intelligent Automation (IA) and Robotic Process Automation (RPA) should enable workers to reduce the standard working week from five days to four days – with no associated drop in wages. That sounds lovely!

The TUC has noted that, unsurprisingly, a large proportion of workers would like to work four days per week instead of five, but few can afford to reduce their hours if their earnings were reduced. Who wouldn’t want to work fewer hours for the same reward?

Is it possible?

The TUC highlighted that unions had campaigned during industrialisation for a reduction in the standard working week from seven days to six, and later from six days to five. At the time, arguments for the reduction were based largely on productivity of workers i.e. if an individual gets two days rest per week, that same person will probably be as productive over five days as they were over seven. The business’s overall output remains the same with no corresponding increase in cost.

We are now on the cusp of a third industrial revolution. If the first was the introduction of machines – which transitioned production from cottage industry to factory industry, and the second was the introduction of production lines as an enabler and factory machine automation which leveraged the production line – the third is the introduction of computers as an enabler and office automation which leverages the computers.

The TUC argues that the four-day week is one of their key goals for the third industrial revolution. If IA, RPA, machine learning and AI can reduce the administrative burden on workers, and make processes more efficient with fewer key strokes and more concurrent activity, then this will free people up, right? Right! 100% accurate. But what will businesses do with that time? Let’s assume that a business adopts RPA, which results in a 20% reduction in the demand on staff thus freeing up one day per week per person across the organisation. Now let’s look at the available options to the business:

1. Do nothing and effectively allow an increase in unproductive time, which results in static productivity and resourcing costs.
2. Reduce headcount and make a 20% saving on resourcing costs.
3. Shorten the working week for staff while maintaining wages at the same level, which results in static productivity and resourcing costs.
4. Shorten the working week for staff whilst reducing wages on a pro rata basis resulting in static productivity and 20% saving on resourcing costs.
5. Expect people to do more work on the fifth day, thus increasing output by 20% while maintaining static resourcing costs.

Some of the options are already looking more attractive than others. This assumes there is no cost to implementing the new technology, which is obviously not the case in most circumstances. Let’s take that into account and look at those options again:

1. Do nothing, which results in static productivity and resourcing costs plus the cost of implementation – overall increased cost for the same output.
2. Reduce headcount and make a 20% saving on resourcing costs plus the cost of implementation – still an overall cost saving for the same output.
3. Shorten the working week for staff while maintaining wages at the same level, which results in static productivity and resourcing costs plus the cost of implementation – an overall increase in cost for the same output.
4. Shorten the working week for staff while reducing wages on a pro rata basis resulting in static productivity and 20% saving on resourcing costs plus implementation costs – an overall saving for the same productivity.
5. Expect people to do more work on the fifth day thus increasing output by 20% while maintaining static resourcing costs plus implementation costs – an overall increase in productivity whilst also increasing cost.

So, if a business’s objective is to cut cost, options two and four would contribute to achieving that objective. If the objective is to grow then only option five achieves that. While they may exist, we have not met anyone who controls an organisation’s purse strings who would accept options one or three, meaning the TUC’s objective of a four-day week without reduced wages is going to be very hard to achieve citing technology alone as an enabler.

What are the Benefits of Intelligent Automation and Robotic Process Automation for Workers?

Given recent reports that workers fear IA/RPA and AI, it’s great that the TUC seem to be embracing the concept and looking for the benefits for workers of which there are many. But, in our view, it would be more realistic to focus on improved job satisfaction due to people doing more of the tasks where they add value instead of menial admin; improved wages as people perform more creative and innovative tasks; improved business solvency, which helps protect jobs; and less stress resulting from pressure to more accurate/more compliant/quicker in the performance of administrative tasks.

That’s our view. It would be great to hear your views on the topic! Contact us via our website or on linkedin.