## Dissecting the Decline in Average Hours Worked in Europe

_IMF Working Papers, January 12, 2024_

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## Bibliographic details
- Authors: Diva Astinova, Romain A Duval, Niels-Jakob H Hansen, Ben Park, Ippei Shibata, Frederik G Toscani
- Published: January 12, 2024
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798400261183.001

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### Key findings
- Three years after the COVID-19 crisis, employment and total hours worked in Europe fully recovered, but average hours per worker did not.
- The decline in average hours worked:
  - (i) is not cyclical but predominantly structural, extending a long-term trend that predates COVID-19,
  - (ii) mainly reflects reduced hours within worker groups, not a compositional shift towards lower-hours jobs and workers,
  - (iii) is driven by men—particularly those with young children—and youth,
  - (iv) shows that declines in actual hours match declines in desired hours.
- Overall assessment: there is scant evidence of slack at the intensive margin in European labor markets, and the trend fall in average hours worked seems unlikely to reverse.

### Drivers and distributional patterns
- Within-group reductions in hours are the main source of the decline, rather than changes in workforce composition.
- Demographic and household characteristics matter:
  - Men, especially those with young children, are a primary contributor to the drop in average hours.
  - Youth also play a prominent role in driving the decline.
- Actual and desired hours move together, indicating preferences or constraints have shifted alongside realized hours.

### Policy implications and quantitative impact
- Targeted policy reforms could raise actual hours towards desired levels for specific groups:
  - Reforms aimed at involuntary parttimers.
  - Reforms supporting women with young children.
- Estimated aggregate impact of such reforms on average hours would be limited to 0.5 to 1.5 percent.

### Scope, methods, and publication notes
- Subject areas: Gender, Labor, Labor force participation, Labor markets, Labor supply, Population and demographics, Women.
- Keywords used in the analysis include: Europe, full time worker, hours worked, Labor force participation, labor market, Labor markets, Labor supply, policy reform, scant evidence, summary statistics, Women, worker level, working hours.
- Pages: 44.

*IMF Working Paper No. 2024/002 (January 12, 2024).*

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_Source: https://www.imf.org/en/publications/wp/issues/2024/01/10/dissecting-the-decline-in-average-hours-worked-in-europe-542417_