The super power of longer work hours

'More hours' does different things at the level of individual, firm or country

N R Narayana Murthy made waves when he advocated 70 hours a week of work for the young.

The hours put in by an individual

There is much merit in high levels of intensity in work. The mass culture extols fun, the work/life balance, and the shallow hours spent consuming the creations of others. It fails to understand asceticism, the importance of concentration, and the importance of doing rather than watching.

The word “talented” is dangerous and misplaced. Virtually none of us is an Einstein or a Ramanujan. What comes of us is made by work, by marinating in ideas, through the influence upon us of clever people and good people. Edison famously said that genius is 1 per cent inspiration and 99 per cent perspiration. Age as measured in CPU seconds is a better measure than years of experience.

The hours per day through reading and working make skills and capabilities. The real puzzle of life lies in rising above that, to inventing and creating. There also the hours count. When Baba Allaudin Khan was young, he practised 16 hours a day. He was the greatest of teachers of Hindustani classical music, and a key part of his recipe for the children being taught was work/life imbalance. Amit Varma and I recently did a conversation about an unusual subject, Bruce Springsteen (https://bit.ly/EiEbruce). In his story we see a big role for gritty hard work.

Young people need to clock in long hours: Doing, reading, and thinking. Find the best master and become their apprentice. Surround yourself with clever and good people. The emotional environment matters: Being in the assembly line at Kota is harmful. Pursue the knowledge, not the rank in the exam (https://bit.ly/PaiShahJee).

The hours put in at a firm

There are firms where many key individuals work very long hours a day, where key persons are indispensable. Here, it is worth sounding an alarm on management. In a well-run firm, no person should be indispensable. In a well-run firm, there should be sound processes and not fire-fighting. When we see a firm mired in crisis management and long hours, something is wrong.

Fire fighting and long hours can be done for some years in the zeal to build an organisation. They cannot be sustained indefinitely. A weak firm can hang in there putting in extremes of inputs for some years, and when the intensity cannot be sustained, it will die. Or, the weak firm can graduate to genuine productivity, where it gets the requisite work done at sustainable levels of inputs.

The hours expended in a country

Consider a person doing accounting, law or medicine. Working 70 hours/week generates twice the billings when compared with 35 hours/week. So the individual stands to earn twice as much by working at twice the hours. Does that carry through to the country? Will the Indian GDP double if everyone worked twice as hard?

This kind of reasoning runs into the fallacy of composition. Imagine that all accountants work 35 hours/week. When one accountant goes up to 70 hours/week, other accountants have to lose roughly 35 billing hours/week. The choke point in India is that weak growth has given a stall in the labour market; we are stuck at about 420 million persons working. Each one person that is taught a skill tends to take away a job from another person. This is a foundational flaw in much of conventional 

humanitarian philanthropy.

Is brute hours of the essence in India’s becoming an advanced economy? Let’s wave a magic wand three times. We will go from 410 million persons working to 820 million persons working: A 2x in the labour. We will also double the hours per week. Thus, overall, there is a 4x in the labour. We will also do the commensurate 4x in the capital (with machines, offices, and infrastructure) so as to keep pace with the 4x increase in the labour. For example, in that India the market capitalisation of the stock market will be four times bigger than it is today.

It would take quite a magic wand to do these things! In history, there have been episodes where dictatorships imposed immense state cruelty upon a country and generated massive increases of the inputs. With all this huffing and puffing, we would muster a 4x gain in inputs, which gets us to a 4x gain in GDP. Does this get us to match the advanced economies?

No, it does not. The global frontier is the United States, with a per capita GDP of $70,248, which is 31.1 times higher than that in India. The most herculean and, admittedly, unrealistic scenario where inputs are mobilised to raise India’s GDP by four times do not take us near the US’s.

To add insult to injury, French labour law prevents the work week from being above 35 hours/week. French per capita GDP is $43,658, which is 19.33 times higher than that in India. Even with a 4x gain, we’d be far behind. India is very poor when compared with the advanced economies.

The lesson here is that India’s transformation requires higher productivity, not just more inputs of labour and capital. Why is India poor? The firms are poorly organised, and fare poorly on converting input into output. In building better firms, we face “how” and “why” questions. The “how” question is: What kinds of method of governance, strategy, and operations deliver better Indian firms?

And then, we have to go one level deeper to the “why” question. Why are firms currently constructed in India by rational owners of a lower quality? This story lies in institutions, in the workings of the state, in state coercion, and the rule of law. Vijay Kelkar and I wrote a book about this — In Service of the Republic: The Art and Science of Economic Policy (https://bit.ly/isotr).

The writer is a researcher at XKDR Forum