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Timesizing News in Feb. 16-28, 2001
[Commentary] ©2001 Phil Hyde, The Timesizing Wire, Box 622, Cambridge MA 02140 USA (617) 623-8080

2/28/2001  beams of intelligence -

2/27/2001  beams of intelligence -
2/24/2001  beams of intelligence -
  1. [The shorter workweek moves up in credits for French job creation - 4th paragraph!]
    French unemployment seen falling to 9.1% in January: Survey, Bloomberg Feb/23/2001 9:06 ET via AOLNews.
    PARIS...- The following is a survey of economists' expectations for French unemployment in January.
    Expected figures. The unemployment rate probably fell to 9.1% in January, its lowest level since March 1991, from 9.2% in December, according to the median forecast of 13 economists polled by Bloomberg News. The number of registered jobseekers is expected to show a decline of 20,000.
    Time. The Labor Ministry is scheduled to release the report on Feb. 28 at 8:45 am, Paris time.
    Behind the numbers. The French economy created a record number of jobs last year, as faster economic growth and the introduction of the 35-hour work week legislation pushed companies to hire. While recent economic reports have indicated that the euro region's second-largest economy can weather the slowdown in the U.S., unemployment is likely to decline less rapidly this year, as the effect of the shorter work week recedes....
    [No problem. Trim the workweek a couple more hours. There's no reason why EVERYBODY shouldn't find it very easy to support themselves in a high-technology society. In fact, our Timesizing program keeps the workweek flexible, slowly fluctuating, mostly downward, as our level of technology goes upward.]

  2. Brazil prison guards postpone strike, AP-NY-02-23-01 2317EST via AOLNews.
    SAO PAULO...- More than 20,000 prison guards in Sao Paulo state on Friday postponed a strike called for the [extended] Carnival holiday weekend, as jails across the state braced for a repeat of last weekend's violent rebellions...when 16 prisoners died in riots that spread to 29 prison facilities across Sao Paulo state, the country's biggest ever prison uprising.... The guards [were] demanding a 60% wage hike, shorter hours, 5000 new reinforcement prison guards and the installation of metal detectors at jail entrances....
    [Sounds a bit like shorter hours and more jobs = less workweek and more workforce = the Timesizing principle.]

2/23/2001  beams of intelligence -
  1. Texas Instruments idling chip factories, Bloomberg via BG, C5.
    ...[The firm] whose chips run 2/3 of the world's cellphones [is] temporarily shutting 5 chip plants through the second quarter to cut costs amid the slowing economy.
    [This is a very misleading mangling of the Bloomberg story on the part of the Boston Globe, which makes it sound like they're shutting 5 factories for 3 months. For the real story, we go to the original Bloomberg version, "Texas Instruments to cut production at 5 factories [to cut costs], WSJ says," Bloomberg Feb/22/2001 15:40 ET via AOLNews -]
    ...Texas Instruments is closing three plants for one to two weeks, depending on demand for products..\..the Wall Street Journal interactive edition reported.... The closings won't occur at the same time, but in a sequence through the end of the second quarter, the paper said.
    Texas Instruments is shortening the work week at two other plants, the paper said. The company closed plants temporarily during previous economic slowdowns
    , a spokeswoman told the paper.
    The first company facility to experience a temporary shutdown was an analog-chip plant in Merrimack, NH. About 300 people were idled in the two-week shutdown that began Monday.
    [In short, TI is practicing timesizing, not downsizing. This means they are preserving their skillset, their morale, their employee loyalty, and they are minimizing the spread of their own distress throughout the economy, not amplifying it as indefinite layoffs would have done.]

  2. Minorities behind in economic boom, by Geralda Miller, AP-NY-02-22-01 1525EST via AOLNews.
    DETROIT - Dina Owens has already spent two weeks without a job this year, the result of a temporary layoff by DaimlerChrysler AG. She doesn't like how it feels....
    [A two-week furlough is not being "without a job." It is no "worse" than a standard American vacation. And she may not like how it feels, but we bet it doesn't feel as bad as really being without a job.]
    DaimlerChrysler wants to retain its top talent by looking at documented performance and worker skills as it cuts its payroll, but a diverse work force also is important, said Monica Emerson, director of staffing development and diversity for the German-American automaker. "We believe that in our recruitment effort that we have cast a very wide net and attained a very capable diverse talent," she said. "In making the reduction, we will not erode the gains that we have made in diversity"..\..
    [And the same article mentions another company that is cutting worktime instead of workforce -]
    James Phillips...from Dayton, Ohio, has worked as a solderer at Dayton Thermal Products for the past five years. The company manufacturers heating and air conditioning systems for automobiles. Phillips...was laid off briefly this month, and he fears he will be sent home again because the company is rotating the furloughs. He has started looking for a part-time job.
    "I'm very much worried about the future," said Phillips, who makes $11.50 an hour. "It's very, very scary right now. Cars are not selling. I'm hitting the streets."
    Phillips and his wife, a schoolteacher, have five children ages 6 to 18. They own a home and cars. He said he is now worried about mortgage payments.
    'What if I don't get called back? Then the car goes," he said. "The bills keep coming. The kids need food. They want clothes. My heating bill just doubled. It's a scary situation."...
    [But at least he knows that his company values its employees enough to get involved in "furloughs" - timesizing, not downsizing. It would be better if they just adjusted their company workweek a couple of hours downward (or back upward) every week, but still, they are practicing a primitive form of work spreading and sharing, of which Timesizing is probably the most flexible and advanced form.]

  3. [And in France with its new 35-hour statutory workweek, one company "deals with it" -]
    Société Générale 2000 profit beats forecasts, by David Clarke, Reuters 04:24 02-22-01 via AOLNews.
    PARIS...- French bank Société Générale posted a better-than-expected 36% rise in 2000 net profit to a record 2.689 euros ($2.24B), despite a drop in 4th-quarter retail banking profits....
    [Yet another counter-example to the "sky is falling" predictions of conventional, time-blind economists who thought that France's workweek reduction would kill the economy and every firm in it. And here's how Société Générale dealt with it -]
    Net profit at Société Générale's retail branch rose 17% in 2000, but there was a 20% drop in Q4. The bank said while net banking income rose 6% there was an exceptional 11% jump in operating expenses. It said it had booked the majority of 2000 costs related to the reduction in the legal work week to 35 hours in the fourth quarter and full-year provisions for the group's employee profit sharing scheme were also charged to fourth-quarter accounts....
    [So these conservative bankers are "crying all the way to the bank." There are many folks who just have to get dragged, kicking and screaming, into heaven. And they're still predicting gloom -]
    At 2.689 billion euros, the bank's net attributable profit is already near its 2002 target of 2.7 billion euros. However, the bank said in November this was a conservative estimate, based on the assumption the economic environment was unlikely to be as favourable as during the 1999/2000 period.

2/22/2001  beams of intelligence -
  1. 5,000 furloughed, Bloomberg via BG, C9.
    Tyco International Ltd...the world's biggest maker of electronic connectors..\..which has offices in Exeter, NH [is temporarily] laying off about 5,000 workers at the company's electronics operations because of lower demand from the US automotive, consumer electronics and computer industries. The two- to three-week unpaid furloughs, which have been taken by about 80% of the employees notified, are taking place in Penn., Mass., and Calif....
    [Again, 'timesizing, not downsizing' - an example of rather unusual valuing of employees by Tyco. Here are more details from "Tyco puts 5,000 workers on unpaid leave - report," Reuters 08:04 02-22-01 via AOLNews -]
    ...The furloughs are not expected to affect earnings.... Tyco does not have any plans for permanent job cuts or layoffs, nor is it instituting furloughs in any other divisions..\..compay spokeswoman Judith Czelusniak was quoted as saying....

  2. General Motors plans temporary closings of plants, Bloomberg via NYT, C4.
    ...intermittent closings of 14 plants through mid-June. The temporary closings will affect almost half of the automaker's 29 plants in North America. GM...also plan[s] to slow assembly at four plants. GM and other automakers have been idling factories and [furloughing] workers to reduce inventories as demand drops after record sales in 2000. The 14 factories are being idled for one to five weeks.
    [So, an unspecified number timesized but not downsized. This shows the advantage of adjusting the workweek an hour or so at a time instead of more dramatic/traumatic week-at-a-time adjustments.]

2/21/2001  beams of intelligence -
2/17/2001  beams of intelligence -
there are 3 English-language AOLNews articles mentioning "shorter workweek" today, all betraying the English-language economists' prejudice against the whole approach by raising the subject only in the second half of the article and in no case earlier than the 10th paragraph -
  1. [the earliest in the day -]
    French economy adds 121,200 jobs in fourth quarter, Bloomberg Feb/16/2001 3:02 ET.
    PARIS...- French payrolls expanded faster in the fourth quarter, boosting the number of jobs created last year to an all-time high, as factories stepped up production.
    [They might well have gone on to add, "and as consumers stepped up demand, and as employers stepped up hiring, and as government cut the statutory workweek by four hours," but alas, the first mention of the shorter workweek is delayed to the 10th of its 16 paragraphs -]
    French workers' hourly wages rose 0.6% in the fourth quarter, 0.2 percentage points of which resulted from reduction of the statutory workweek to 35 hours from 39 without a loss in pay, today's [preliminary Labor Ministry] report said.
    [That's cutting it rather fine. We wonder how they size and where they assign the other 0.4 percentage points.]
    Shorter week. Today's report also showed the pace of job creation peaked at 1.1% in the first quarter of last year. Shorter workweek legislation saved or created 100,000 jobs last year, according to the Social Affairs Ministry. That represents about a fifth of new jobs created.
    [What about the increased demand that the worksharing generated by spreading wages? What about the multiplier effect?]
    "Job growth last year was very much boosted by the 35-hour-week," said..\..Gwyn Hacche, and economist at HSBC Bank Plc in London....
    [That's a big admission coming from an English-language economist, but she soon makes up for it -]
    "That effect will go."
    [In other words, "wear off." But it won't wear off if France keeps its workweek flexible and continues to adjust it downward if more job growth is wanted. They don't even have to specify "without a loss in pay" as the labor surplus is absorbed by the job market, because market forces will take care of it just as they did for the 150 years of workweek reduction and rising pay before the world followed the US in freezing its workweek at 40 hours or more in 1940.]
    Many companies were persuaded to implement the law in advance of the deadline this year because of incentives, such as payroll tax cuts [for] hiring additional workers and greater scheduling flexibility. Companies with fewer than 20 employees have until the end of this year to comply.
    Unemployment held at a 9½-year low of 9.2% in December, as job creation expanded for the 17th consecutive quarter at the end of last year....

  2. [Then we have a later article that covers the same general ground, but here the shorter workweek isn't mentioned till the 13th of 21 paragraphs -]
    European economies: French job creation accelerates, Bloomberg Feb/16/2001 9:03 ET.
    PARIS...- French companies created a record number of jobs last year and the nation's manufacturers said they plan to boost investment in 2001, suggesting there's no let-up in growth in the euro zone's second-largest economy.
    Companies created 517,400 jobs, including 121,200 in the fourth quarter, the Labor Ministry said. Industrial companies plan to boost investment 9% in 2001, according to a separate government report, based on a survey of 2,500 companies....
    France's exposure to the U.S. slowdown is limited as the U.S. buys less than a tenth of the nation's exports....
    While the region's economy as a whole will probably slow this year - to about 2.8% from more than 3% - the pace of expansion is likely to outstrip that of the U.S. for the first time in a decade, analysts said....
    "The fundamentals of the European economy are good," Italy's Treasury Minister Vincenzo Visco said in an interview. "It's the only balanced economic area in the world."...
    [Well, the Italians aren't doing squat to generate this balance by cutting their own workweek, but at least they're in on the general European trend to cut the workyear by having long vacations and it's great that some Europeans aren't afraid to shoot off their mouths and stick it to the English and Japanese-speaking economies (except Australia) for being stupid enough to think they can build stable investment on pre-technologically long workweeks and consequently unstable jobs and straitjacketed consumption.]
    Rising employment. Rising employment is likely to underpin consumer spending, which accounts for about 55% of the French economy, analysts said....
    [For example,] GFI Informatique SA, a computer services and software company...plans to hire 1,500 people in 2001.
    [Now at last, in paragraph 13 with plenty of built-in skepticism -]
    The government claims its policies have helped to reduce unemployment. The reduction of the statutory workweek - to 35 hours from 39 - saved or created 100,000 jobs last year, the Social Affairs Ministry said.
    Many companies were persuaded to implement the shorter workweek last year, and hire more workers to make up for the labor shortfall...
    [So much for Juliet Schor's contention that worktime reduction has been "a disappointing strategy for creating employment" because of the frequent productivity rise that follows (p. 155, The Overworked American). If output generally rises as worktime is cut, then zero worktime would produce infinite output. We rest our case.]
    ...to take advantage of tax breaks designed to smooth the transition to the new labor law.
    [which apparently rules out a commensurate reduction in pay in its present form.]
    Some economists, however, said that the shorter workweek could lead to slower job creation in coming years, as it may deter foreign investment.
    [With French industrial companies planning "to boost their own investment 9% in 2001" (see beginning of article), WHO CARES about foreign investment?! And besides, France can always speed up job creation by reducing the workweek even further. The USA, in a brief "attack" of common sense, passed a 30-hour workweek through the US Senate in 1933.]
    Unemployment rate declines. While a report last month showed that France's jobless rate had declined to 9.2% by the end of last year, from a post-war peak of 12.6% in June 1997, the nation's unemployment is still more than twice as high as that of the U.S....
    [Well, that may be because the U.S. unemployment rate undercounts the problem. We've probably got the most watered-down unemployment rate in the world next to South Korea's.]

  3. [And lastly, we have a slightly earlier story from Reuters that succeeds in avoiding any mention of the shorter workweek until the 15th of 19 paragraphs -]
    France invests to keep economy steaming ahead, by Matthew Green, Reuters 06:49 02-16-01.
    [The emphasis on what amounts to reinvestment in their own markets is a nice feature of this article -]
    French firms have adopted more ambitious investment plans this year, bolstering the prospect that corporate France will sidestep the blow from a U.S. slowdown and sustain record-breaking job creation....
    Investment is needed to boost growth potential at a time when many firms are straining at full capacity, raising France's hopes of achieving the rapid growth and low inflation witnessed in the United States in the last decade....
    [France would be smart not to imitate the hollow growth (bubble) of the U.S. last decade. Hardly anybody is "straining at full capacity" over here right now.]
    The latest picture was in sharp contrast to the early 1990s, when high corporate debt levels, an economic slowdown and gloomy profits meant France fell behind in the race to modernise.
    According to official figures, French investment levels rose 24% in absolute terms between 1997 and 2000, having fallen by 4.7% between 1992 and 1997....
    [And finally, the shorter workweek mention with all kinds of skepticism -]
    However, some voices in industry were concerned that government efforts to aid job growth by cutting the workweek to 35 hours from 39 would constrain output capacity, warning that labour shortages could brake expansion.
    "Industry heads are reserved about launching new investments," said Francis Lemor, head of the Stef-TFE (STF.PA) refrigerated transport group. "We're finding that there are opportunities that we cannot seize because we cannot find enough trained people to run the operation," he said.
    [Then TRAIN 'EM, refrigerator brain! And your own whining about new investment restraint is contradicted by the manufacturers and industrialists mentioned at the beginning our previous article who plan to boost investment 9% in 2001. Coupling workweek reduction with the automatic conversion of overtime into training and hiring is a smart feature that France's primitive version of worksharing has not yet implemented.]

2/16/2001  beams of intelligence -
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