The bargaining power of employees has changed radically

PwC Hungary introduced a 4-day working week in its audit business this summer on a pilot basis. From June to September, the company's 280 employees work only from Monday to Thursday. Telekom and Libri tried it, but in the end they did not stick to the 4-day working week. Why hasn't this worked in Hungary, when in many Western countries it works perfectly well?

György Bőgel: It is a complex question. It seems to me that in Hungary we have quite a serious problems with labour productivity, i.e. how much GDP we produce per working hour. For some time now, we have been doing less well than other countries, and we are among the worst performers in Europe (we are ahead of only Romania and Bulgaria in the ranking - ed.) In order to have enough time to work in four days and to produce as many products and provide as many services in four days as a country or the majority of companies could in five days, productivity needs to increase. Unfortunately, productivity in our country is stuck, it is not increasing, and the spring figures show that the economy is not really willing to settle down, so I do not see much chance of introducing shorter working hours.

So the 4-day working week is bleeding to death. Is there a way of flexible working that could work in Hungary?

Covid has shown that a lot of work can be done quite efficiently from home. Obviously, it depends on the profile, where it works well and where it has caused problems, or where it doesn't work at all. I'm an advocate of introducing hybrid working in many places. Some companies require 2-3 days a week and employees can work from home the rest of the time. This also means that the working conditions are appropriate, for example the technical conditions, so that the work can be done safely from home. In Covid's time, many people tried this out of necessity. This had many advantages, such as saving the time and cost of commuting to work, saving the company on the cost of office rent and many other expenses. These were short-term benefits, but the long-term effects, such as the impact of isolation on knowledge sharing, innovation, work morale, people's mental state, will only become clear over a period of years, and not necessarily in a positive way. Perhaps that's why I see - at least in part -a backward-looking "let's go back to the office".

However, the "back to the office" slogan is not only being issued in our country, but also in more developed economies where GDP would allow working from home. Why?
It is a global trend. Covid was a constraint, not a natural situation. People have got it as an "acquired right" to work from home, and it is very difficult to take that back. But the disadvantages of the solution, as I said before, have slowly emerged. So to overcome them, the return is a bit forced, but it is being done - even in places where home office would otherwise work just fine. So I think hybrid will be the way of the future. Of course, the boundaries between how much on-site and how much remote  can work may change in the future depending on economic and other circumstances.

Some companies are worried about whether their employees are working at home enough, even though many certainly do not see home working days as days off. Could it be that the problem lies in inadequate measurement and monitoring of performance at home? 

I think flexibility is very important for an employee. This is not a new thing. I worked in the early 1980s in a ministry back office, in an industrial economics institute, where we already had flexible working hours. In an initial form, but they started to deviate from everyone working 8-16 hours. You could go earlier or later, the point was that you had to work 8 hours a day. However, there are a lot of jobs where it is uncontrollable who works how many hours. Obviously it does not necessarily means work if I go into an office and just stare ahead. Where performance is measurable, freer working hours can be given. 

The issue of working hours has recently been raised in many companies because of the need to achieve a work-life balance, which is increasingly demanded by employees. What should we look out for? Do you see any good practices?

In the past, there was also a need to feel comfortable at work, to work a suitable schedule and for employers to take care of our health. What has changed radically in recent years is that workers have a bargaining position that if these needs are not met, they will move to another job, because we are in a boom economy. Because this has been going on for at least 10 years, there is a generation that has grown up that is used to this. I was at a well being conference the other day and that was all they talked about. So it is in the air because of the demand and also because of the bargaining power. The workforce is strong right now because there is a labour shortage.  

You also hear at job fairs, at conferences, many employees have flexible working hours, at least partial home office...

For a lot of workers this helps a lot, especially in Generation Z or younger workers. They've just started working, they've just started a family, they're looking to get a flat, they need to stay at home with the child or take the child to nursery school. It was good for me when I had these problems. A lot of people wouldn't even be able to work if they didn't get this. For example, stay-at-home moms, if they work in a home office in a call center job, it's good for everybody. The company gets labour and she gets a job and an income. A worker over 50 with children out of the house obviously has completely different needs.

So what working arrangements can work in the economy that are viable?

The 4-day working week, hybrid working, teleworking, the introduction of core hours can all work in the right place. In the 1980s, sociological research led by Csaba Makó already looked at 'atypical forms of employment'. In some western countries, these were introduced much earlier than in our country. There are two extremes: one is that working hours last from 8 to 16 hours and you have to be in during that time. The other is that I assign tasks and the employee works the hours he can. There are places where this can be done, but not on a construction site or a car assembly line. In a software development company, on the other hand, it's okay to work at night because you can be more efficient.   

With the advent of Generation Z and slowly Generation Alpha, there are 4 generations in the workforce. How to integrate the generations well in the workplace?

I think this integration is not an easy task. It's not easy to have up to 4 generations working together in a large workplace and it's a lesson for managers, but it's also true I think that this topic is a bit exaggerated. I don't see much conflict in this, too much newness, perhaps the number of generations on the field at the same time is unusual. But in a larger workplace, young and old have worked together in the past. A good manager can 'chess' the tasks, which ones are entrusted to the older worker, which ones to the young and how these people can work together. Of course, you cannot use the same tools to motivate, manage and control workers of different generations. 

There is a lot of talk these days about artificial intelligence, with many experts predicting that it will disrupt the labour market, and many people fear that they will lose their jobs because of it. How realistic do you think this is?

I think it will make a big difference, but nowhere near as big as the buzz that this is creating. With new technologies, there is always this notion of the hype cycle, whereby technologies that have been developed at huge expense and promoted at huge expense are made to believe that 'if you miss out, you are left behind'. Of course, every major technological change so far has caused changes, sometimes radical ones - e.g. agricultural mechanisation has affected 70% of the workforce. A hundred years ago, 70% of workers were in agriculture, now it's only maybe 2%. I don't think AI will cause such changes, but it can certainly be used in many places. It could also create many new jobs. It can take over from people in medical diagnostics, quality control, supply chain management, customer services and many other areas, but I do not fear mass unemployment.

What are you working on these days, what topics are you interested in?

Innovation and entrepreneurship. Who are the people who are leaving secure jobs to go into business and why do we have fewer entrepreneurs than other countries? Why are there no Hungarian unicorns, no businesses with a market value of $1 billion, and do we even have a chance of that? What kind of innovations can be created in Hungary that can become a business? These are the things that interest me at the moment.