Workplace flexibility has obvious appeal as an alternative to the traditional 9 to 5 day. Arrangements such as telecommuting and flexible working hours have been around for a while, with nearly a quarter of the U.S. workforce doing some work from home. But how much do employees value this flexibility? And how good are they at assessing the factors that contribute to their own happiness? The answers are not what you may think. Results reported in a National Bureau of Economic Research working paper, clearly indicate that, whatever people might say about their desire for greater scheduling choice, most employees aren’t willing to give up much pay to get it.
Does this mean that most job seekers don’t value flextime? If we assume that people have a good sense of what makes them happy, that is the survey’s main takeaway. Moreover, for the employees who do value flexibility, there may already be efficient sorting into jobs with more scheduling discretion. But research suggests that we might not be so adept at making decision about when, where and how much we work. In particular, people may not realize the cost – in terms of their happiness – of working harder to make more money.
A 2016 study in the journal of Social Psychological and Personality Science, based on surveys of thousands of Americans, found that while most respondents reported that they would prefer more money to more time, the ones favoring time were more apt to report being happy. This shouldn’t be surprising. Research has shown that money does indeed buy happiness, but only up to a point. If people overestimate their ability to buy happiness and underestimate the joy they derive from more time and freedom, flextime appears in a very different light.
Looking at today’s labor market, these findings point to both challenges and opportunities. Employers such as UBER and TaskRabbit allow people to make granular, hour by hour decisions about whether they want to work or play. And Skype and FaceTime make it easier to work from home. Of course, employees don’t make decision about when and where to work in a vacuum. Even when flextime is available, its attractiveness depends on how it is perceived by others, particularly by higher-ups. If they don’t put in enough face time at the office during business hours, will it put them at a disadvantage for a promotion?
The new labor market in the U.S. might develop in any number of directions. Will we converge on a world in which we all work 9 to 5 (and often longer) with little flexibility, or can we find a way to build everyday routines that are more accommodating, more flexible and potentially a lot happier?