Madrid: Trade unions are organising protests throughout Spain on Thursday to pressure the government and the business sector into agreeing on a reduction in working hours. Prime Minister Pedro Sanchez’s Socialist government aims to reduce the working week by 2.5 hours from the current 40-hour standard, arguing that this will enhance productivity.

The proposal is part of a broader strategy to address productivity gaps within the European Union, highlighted by former European Central Bank chief Mario Draghi, who noted that Europe must compete with economic rivals like the United States and China. To gain employer support, the government has proposed a hiring bonus for small businesses with fewer than 10 employees, intended to offset the costs associated with the reduced working hours while maintaining service levels.

Madrid can implement this reduction without consensus from all parties, and a senior government source has indicated that a decision will be made before the end of 2024.

The government’s plan calculates the working week on an annual basis, allowing sectors with inflexible shift patterns, such as hospitality, to accrue hours that can later be compensated with holidays. Despite working more hours than many Europeans, with an average of 36.4 hours in Spain compared to the EU average of 36.1 hours in 2023, there is skepticism among business owners. They fear that the proposed changes may result in employees working fewer hours for the same pay.

Labour Minister Yolanda Diaz has asserted that reducing working hours could significantly increase productivity, an area where Spain has historically underperformed compared to its European neighbours. However, the impact of similar measures implemented in other countries remains uncertain. For instance, France introduced a 35-hour work week in 2000 with the expectation of creating numerous jobs, but data subsequently revealed that the cost of labour increased, rendering French workers relatively more expensive and negatively impacting competitiveness.

As protests loom, the outcome of this initiative will not only affect the Spanish workforce but also set a precedent for future labour policies within the EU. The balancing act between employee well-being and business viability will be closely watched in the coming months.