Économie et Statistique n° 359-360 - Business Cycle Report
The Shorter Working Week and the Strain on Inputs
From 1997 to late 2000, the upturn in the French economy's performances was accompanied by increased strain on inputs. Although such strain is normal in a period of high production growth, it is interesting to analyse the extent to which the application of the 35-hour working week may have increased the constraints on production capacities in these circumstances. Businesses' answers to the quarterly industrial situation and outlook surveys show that companies applying the 35-hour working week for less than a year have more constraints than companies that are comparable in terms of size, turnover, activity sector and business-specific characteristics constant over time, but which have not reduced their working week. Of these short-run constraints, the establishments that have switched to 35 hours have more recruitment problems when the recruited manpower is skilled. These establishments also have more production bottlenecks. However, the difference disappears in the medium run and this absence of particular constraints does not appear to be due to a downturn in orders. Yet the possible existence of selection biases among the companies that have switched to 35 hours calls for these findings to be qualified.