Timesizing® Associates - Homepage

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Timesizing News in May 16-31, 2001
[Commentary] ©2001 Phil Hyde, The Timesizing Wire, Box 622, Cambridge MA 02140 USA 617-623-8080

5/31/2001  glimmers of Timesizing -

1. [The battle for an 1840-level workweek flares up in an unswept corner of the world's biggest and arguably, dumbest, economy -]
   AMSA: [U.S.] society's culture of safety extends to airline pilots flying too many hours but not young doctors performing surgery, US Newswire May 30 via AOLNews.
   [A disgraceful and dangerous pocket of Neanderthal conditions in a supposedly advanced nation -]
   RESTON, Va. - ...While the government regulates the work hours of pilots (no more than 16-hour shifts and mandated 8-hour rest periods), no government or industry agency actually regulates the number of hours young doctors - known as resident-physicians - work in teaching hospitals across the country. Residents are graduate medical trainees and typically work 36-hour shifts, with work-weeks of over 100 hours. Residents are often seen as a source of cheap labor to hospitals and are typically required to perform numerous functions not related to their status as trainees. The American Medical Student Assoc. (AMSA) is currently working to gain congressional support for limiting resident work hours to 80 hours per week, with any one shift no longer than 24 hours. ...AMSA and Public Citizen, a consumer advocacy organization, filed a petition with the Occupational Safety & Health Administration (OSHA). The petition iasked OSHA to regulate work-hours for residents based on unsafe working conditions that results in high rates of motor vehicle accidents, depression and pregnancy complications among rseidents who work excessive hours....
   [Not to mention acute danger to patients from error-prone, sleep-deprived people.]
   More information, including the text of the Public Citizen/AMSA petition to OSHA, can be found online at *www.amsa.org.
   Contact: Tim Clarke Jr. of AMSA, 703-620-6600x207 or 703-732-7021 cellphone, email prel@www.amsa.org

2. [another "advanced" society flirts with progress - but rejects it -]
   Swiss parliamentary summer session, June 5-22: Program, by Simone Meier, Bloomberg 05/30/2001 8:18 via AOLNews.
   BERN...- The following is a list of issues that Swiss lawmakers are scheduled to debate in the three-week parliamentary session starting Tuesday....
   [And selecting only the all-embracing top-priority issue -]
   Cut Working Hours
   The upper house will discuss a proposal to cut the average working week to 36 hours. Employees in industry, office personnel, as well as transport and technical workers currently put in a maximum of 45 hours, while all others are allowed to work up to 50 hours per week.
   Workers earning up to one-and-a-half times the average wage, or about 7,600 Swiss francs per month, wouldn't have to take a pay cut in exchange, according to the proposal.
   The lower house in its spring session rejected the move, saying companies would suffer competitive disadvantages.
   [How this proposal could pass without the approval of the lower house is a mystery. Consequently, it's a mystery why the upper house is bothering with it at this time. As for the "competitive disadvantages," the Swiss are simply keeping their economy focused on "working hard, not smart," and even on that outdated basis, they'd have a one-hour "advantage" over neighboring 35-hour France.]
   Time [of debate]: June 19, from 8 a.m....

• France's Communists may oppose layoff bill, derail the measure, by Simon Packard, Bloomberg 05/28/2001 11:39 via AOLNews.
  PARIS...- France's Communist lawmakers may vote tomorrw against a draft law designed to make it harder for companies to lay off workers, threatening to derail the measure because it fails to shield employees from "abusive" job cuts....
  [Same old story. The angry and impatient block small steps because they "don't go far enough," so we don't even get the small steps that would continue the transformation of the whole culture.]
  Following are the main points of the bill voted by deputies so far:
  • Doubling the minimum severance pay to a fifth of a month's pay for each year of employment.
  • Preventing companies from making job cuts unless they've applied legislation reducing the working week to 35 hours.
  • Tightening loopholes that allow employers to avoid layoff programs by firing small numbers of workers at a time.
  • Conducting studies on the eocnomic impact on the area in the case of "large" job cuts. Companies with more than 1,000 staff may pay a charge to help regenerate employment in the region.
  • Lengthening the period during which employees must be consulted about planned layoffs.
  • Making companies with at least 1,000 staff train workers for at least nine months to help them find a new job.
  • Allowing magistrates to block job cuts that fail to meet the legal requirements and force companies to rehire fired staff.

1. Brazil considers declaring 4-day week to save power: Estado, Bloomberg 05/25/2001 8:00 via AOLNews.
   Sao Paulo...- Brazil is studying the possibility of declaring Mondays or Fridays public holidays to avert power blackouts and avoid "traumatising" the public, O Estado de Sao Paulo newspaper reported.
   [So, we don't mind traumatizing the public with unemployment and under-employment as we pour in work-saving technology without spreading and sharing the vanishing work, but we do mind traumatizing them with power blackouts. Bizarre, but - whatever accomplishes the sharing and spreading of the employment and payroll=spending power is OK with us.]
   Pedro Parente, who is leading the government's energy rationing plan, said the government is studying the idea of the four-day work week, originally proposed by Jose Augusto Arantes Savasini, a professor at Sao Paulo University, the daily said.
   According to power utility Cia. Paulista de Forca e Luz, the average energy consumption during the week of 60,000 megawatts falls 35% to 40,000 megawatts on Sundays, adding weight to arguments that long weekends would ease Brazil's power shortage, the newspaper said.
   [Yes but does it fall that much on Saturdays? - because a free Monday or Friday might be more like a Saturday than a Sunday in energy usage.]
   Reservoir levels in the southeastern and central-western regions of Brazil fell to 32% of capacity by April, compared with 59% a year earlier, Eletropaulo Metropolitana SA, Brazil's No. 1 power distributor, said. The shortage of water after a recent dry spell means many Brazilians will have to cut energy usage by 20% in coming months as 84% of the country's power is generated by hydroelectric plants.
   [Hey, at least they're talking conservation instead of building nukes, like us.]

2. Germany: Auto cutbacks, by Edmund Andrews, NYT, C2.
   Adam Opel AG, the German subsidiary of General Motors, announced that it would close its German factories far an additional two weeks beyond the normal two-week vacation break in August. GM Europe, which includes Vauxhall and Saab but is dominated by Opel, lost $257m last year and another $86m in the first quarter of this year. Opel has been losing market share to rivals like Volkswagen, but is also confronted with a steep decline in the German automobile market itself.
   [Well there you are. How many cars do people need anyway? How often so we have to update our car? Despite built-in obsolescence, car makers have not developed as efficient a scam as software makers, some of whom come out with new revisions quarterly. And even that scam is "gettin' old." Environmental concerns are pushing us to cut the built-in obsolescence and get back to building really lasting, durable products. So. Ever more urgently do we need a flexible system of sharing the vanishing work to provide Timesizing, not downsizing.]

• Brockton nurses vow to strike over hiring, by Anne Barnard, Boston Globe, B1.
  A year and two weeks after nurses won limits on forced overtime in the St. Vincent Hospital strike [in Worcester, Mass.], Brockton Hospital [in Brockton, Mass.] could become the next battle zone for the national crisis in health care staffing.... [The strike will not be] over wages, say union leaders.... It's not exactly over forced overtime, since the hospital has already...agreed to limit forced overtime to four hours at a time, eight times a year.
  Rather, union leaders say, it's about the hospital's failure to promise - in contract language, subject to the grievance process - to hire enough nurses to avoid relying on overtime in the first place.
  It's an unusual situation: The nurses are trying to use a labor dispute to force through a solution to the understaffing of nurses, a nationwide problem that, analysts say, underlies public health problems from medical errors to emergency-room shutdowns....
  [This is not that unusual in the U.S. - see for example, "F.A.A. plans to enforce work rules - Warning to airlines on pilots' schedules," on 5/15/2001. And it is quite common in France. For example, in "French museums free during strike" on 5/12/2001 (scan down to date), we read, "Unions are seeking creation of hundreds of jobs to accompany the introduction of France's mandatory reduced workweek." And there are plenty of examples in earlier stories on these 'glimmers of timesizing' pages.]
  It's an argument being played out across the country, following a year in which nurses have vaulted their issues to the top of the national and state legislative agendas and emerged as public, and popular, faces of the health care crisis.
  ...Hospitals say they cannot hire more nurses because of a nationwide [nurse] shortage; [but] nurses' groups say 500,000 nurses...have been driven away by grueling work conditions due to staffing cuts.
  [Not to mention the staffing cuts themselves!]
  California [has] the nation's first law requiring hospitals to maintain certain nurse-patient ratios. The Massachusetts Nurses Assoc. [MNA], which represents nurses at Brockton and 80 other hospitals across the state, is pushing a similar law.... Fourteen states last year introduced legislation limiting mandatory overtime; Maine and New Jersey passed such laws, according to the American Nurses Association.
  [There should be no such thing as mandatory (or forced) overtime, and it is a testimony to our lazy and near-sighted management profession, spoiled rotten by the general labor surplus's flood of resumes, that this oxymoron has returned to erode our historical pre-1940 progress on sharing the technology-reduced human employment as it gradually disappears.]
  And as Brockton negotiates, nurses in Youngstown, Ohio and across British Columbia are on strike, partly over mandatory overtime. In Minnesota, 8,000 nurses may strike at the end of the month. Brockton is notable in that even after winning concessions from the hospital on mandatory overtime, the union is continuing to push for a broader commitment to higher levels of staffing.
  [That's because "concessions on mandatory overtime" are pure rhetoric without commitment to higher levels of staffing.]
  MNA spokesman David Schildmeier said that...without the contract language the union is pushing for,...the hospital can continue to rely on nurses' volunteerism to save money on hiring permanent staff.
  [That's why our Timesizing program ensures in Phase 2 that any overtime that occurs (and it must be completely voluntary, not mandatory) must trigger its own phase-out via overtime-targeted training.]
  There were 79 mandatory overtime shifts from November th[r]ough January, he said. According to the hospital, there were 9,600 hours of mandatory overtime in the last six months, or around 3% of all hours worked.
  [The MNA has recently distanced itself from the American Nurses Assoc. (ANA), partly because -]
  The ANA...opposes mandatory staffing ratios.
  [I.e., it's too wimpy.]
  But, said Rose Gonzalez, director of Government affairs [for the ANA?], the ANA is urging Senators Edward Kennedy and John Kerry to propose new Medicaid funds that require hospitals to increase nurse staffing. "You can give the hospitals as much money as they as for and unless there's some accountability...
  [I.e., mandatory staffing ratios, Rose?]
  ...we won't see it go to nursing."...
  [That's right, because nurses have been locked into a highly sexually differentiated industry of generally rich, commanding, male doctors and poor, compliant, female nurses. And nurses are finally fed up to the eye teeth with suffering in silence. And not a soul outside the deteriorating American healthcare industry blames them. The ultimate source of all these problems is the arrogance of American physicians, much of it symbolized by the gruelling, sick and self-hating initiation they put themselves through via years of megahours internship. It's all a load of sleep-depriving crap that the sick sick American medical profession needs to sweep away to even begin to adequately do its job and respect its coworkers and patients. American physicians, heel yourselves and then heal yourselves! You are grotesque freaks in the eyes of the world, an embarrassment to the nation, and a hellish source of sick, testosterone-poisoned, sleep-deprived, error-prone, chest-thumping posturing that has spread its poison to other professions and skills throughout the economy.]

1. French households tighten purse strings in April, by Joelle Diderich, Reuters 04:57 05-22-01 via AOLNews.
   ...as heavy rains dampened their appetite for clothing and household goods, but analysts said France remained the bright spot in an increasingly gloomy euro zone landscape. Consumer spending in the euro zone's second largest economy fell 0.8% in April, for a 3.2% rose year-on-year, according to figures published on Tuesday by the national statistics office INSEE.... April consumer spending fell most sharply in the clothing sector, where it was down 4.7% in the month, INSEE said.... "The rain and cold obviously don't help sales of our summer items"..\..Bernard Denet, chairman of the board of children's clothing retailer Du Pareil Au Meme...told the financial daily Les Echos..\.. INSEE also revised the scale of a spending jump in March to a 0.9% rise, down from a previous estimate of a 1.3% increase....
   France has withstood the impact of a U.S.-led drop in foreign demand for export goods better than most of its neighbors, thanks to strong consumer demand fueled by a steady drop in unemployment and tax reductions.... Emmanuel Ferry, economist at Exane...said that France continued to remain the star performer among core euro zone economies and he expected this to be reflected in the first quarter French GDP figures, due to be released on Wednesday....

2. French police fire teargas to break up jobs protest, Reuters 07:31 05-22-01 via AOLNews.
   ...a demonstration against mass job cuts outside the French parliament on Tuesday. Scuffles erupted when police chased several hundred protesters away from the National Assembly ahead of a debate on labor reforms. The debate and protest follow a spate of company [layoff] plans that have sparked an outcry in France....
   Socialist P.M. Lionel Jospin's government has attacked the [layoffs] as sacrificing employee rights at the altar of "shareholder value." It says it wants to introduce new laws providing workers with greater protection. Measures under discussion include requiring firms to consult worker representatives more closely before deciding anything that could affect jobs, and committing firms in some sectors to continuous retraining of staff.
   [Now there's a good idea.]
   But the government is resisting pressure from its Green and Communist coalition allies for tougher measures, including an all-out ban on [layoffs] by profitable firms. "We cannot ban [layoffs], be it with administrative or legal means...
   [Yes we can if we substitute hours cuts for job cuts, and we eventually will ban them worldwide except immediately prior to corporate liquidations.]
   ...because that would damage jobs in the short and medium term," said Labor Minister Elisabeth Guigou.
   [Nonsense, quite the contrary.]
   With elections less than a year away, the government can ill-afford to ignore the working class vote, and Guigou's ministry announced additional measures to beef up the bill just ahead of its second reading in parliament.
   [Evidently the working class vote in France is not being bamboozled by a herd of rightwing talkshow hosts as it is here in the U.S.]
   The new clauses would legally oblige firms to examine how...new work..\..could be found [for] employees...when a company restructures its operations. They would also increase the compensation that had to be awarded to people ultimately [laid off]. "(Staff) should have the right to contest the economic logic of thse [layoffs], particularly in companies making huge profits," said CGT trade union chief Bernard Thibault....
   [Then we finally get to the mention of the shorter workweek in the second-last of the 14 paragraphs, but it is exactly the same statement that we quoted and commented on in the Reuters article yesterday - see below. Nice last paragraph though -]
   With joblessness at an 18-year low of 8.7% in March, officials say the French labor market is one of the healthiest in continental Europe and expect unemployment to fall from some 2.3m to under two million by the end of the year.
   [Nice, but - this diverges from another article we noticed from the day before giving jobless rates across Europe. The article is "Global economy watch: GDP, inflation, deficit, jobs, yields," by Karen Kersting, Bloomberg 05/21/2001 13:40 via AOLNews, which gives various European jobless rates as follows - Germany 7.7%, France 8.8%, and Italy (we are not making this up) 9.9%, and then U.K. 10.10% - just kidding, UK's is 3.2% because they undercount as much as the U.S., Russia 11.4%, Austria 3.6%, Belgium 6.8%, Denmark 5.6%, Ireland 3.6%, Netherlands 5.24%, Spain 13.6%, Sweden 3.7% (defined as "open jobless" whatever that means), Switzerland 3.48%, Turkey 7.3%. Of course, the low rates may just be defined to be low, as ours is.]

• French minister denies govt to ban redundancies [layoffs], Reuters 10:30 05-21-01 via AOLNews.
  PARIS...- Labour Minister Elisabeth Guigou said the government would not ban mass redundancies [US: "layoffs"] in France, but it would require companies to offer better social packages for unwanted staff, a French newspaper reported on Monday.... Guigou, a centre-left ally of..\..Prime Minister Lionel Jospin...said a draft law to be studied by parliament this week would not go as far as actually preventing profitable firms from [doing layoffs], as some on the left of the coalition have proposed.
  [Eventually, although individual firing for cause on a case-by-case basis will become easier, corporate mass layoffs will in fact be completely banned except immediately before corporate liquidation. Why? Because they are the very mechanism of economic downturn. They induce recession. They operate to dampen consumer spending and concentrate income into unspendably huge amounts in relatively few hands. The reason France is not going further with such a ban today is that neither the government nor French companies yet realize what a flexible and versatile strategy the alternative is - trimming hours instead of trimming jobs, timesizing not downsizing. Our case studies page indicates some of the diversity of application.]
  "It's not a case of banning layoffs, but of asking company directors to make extra efforts in terms of finding alternative employment and listening to their employees' representatives," she told business daily Les Echos.
  [Oh that's really going to weigh with them - nothing like a moral appeal to businessmen. One wonders when the French government is going to smarten up and start showing them the numbers in terms of damage to their own markets via the downward multiplier effect = the vicious circle of layoffs, less consumer spending, more layoffs, less consumer spending....]
  Guigou said she had been "deeply touched" by the fate of employees, who discovered they lost their jobs as a result of what she called "brutal" corporate downsizings....
  [Betcha that sounds really beautiful in French too = "profondement touchee" etc.]
  Economists have raised concerns that left-leaning structural reforms adopted by the Jospin government - notably the introduction of the 35-hour working week - could discourage foreign investors and hinder the fight against unemployment....
  [Clearly these birds have never heard of "working smart, not hard." These screwed-up chicken little's neither know their own past nor their present. Shorter workweeks were championed by the right-of-center UDF party on a voluntary basis in France in 1996-97, and by the Republican Party in the United States from the 1860s to the early 1930s. Nixon suggested a four-day week in 1956 before getting gagged by Eisenhower. There's nothing left-leaning about shorter workweeks because they are so central and market balancing that market forces alone can take care of all the detailed adjustments instead of socialist-style government micromanagement. Them's the facts of past history. As for the present, the 35-hour-borne strength of domestic demand in France is in fact making it the most attractive economy in Europe for investment, as mentioned in several articles below, for example, on 4/07/2001, "Analysis - Layoff outcry masks better French business climate" which includes the in-text subhead, "France lures investors."]
  But Guigou said that despite recent layoffs, the jobs market was in fact buoyant.... French joblessness stood at 2.3m people in March, for an 18-year low of 8.7%.

5/20/2001  glimmers of Timesizing -

• ['every cloud has a silver lining' dept. -]
  US manufacturing slowdown test steel industry, by Will Edwards, Boston Globe, G5.
  ...The slowdown has led steelmakers to cut payrolls. The number of those employed in the steel industry as of February fell to 148,000, down from 153,000 a year ago, according to the AISI [American Iron & Steel Institute]..\.. Higher energy costs and price competition from overseas have also sapped industry profits, helping bankrupt at least 17 companies over the past 18 months, according to the AISI. "Economic conditions in the domestic steel industry are the worst in 25 years," said John Correnti, chairman and CEO of Birmingham Steel Corp..\.. US raw steel production has fallen by about 20% over the past 12 months as the slowing American economy dampened demand for automobiles and appliances.... Steel mills operated at just 76% of capacity in the week ended May 5, compared with 93% in the same week a year earlier, the AISI reported..\..
  Industrial production [in general] in the US fell 0.3% in April, the seventh monthly decline in a row, the Federal Reserve reported. The plant-use rate fell to 78.5%, the lowest since the end of the last recession in April 1991....
  [So where's the silver lining, you ask? Right at the end -]
  The weakness is widespread. Even Nucor Corp., the industry's most profitable last year, hasn't been spared. The Charlotte [N.C.] steelmaker reported a 60% drop in first-quarter earnings last month.
  [So what's so great about that? Note the phrase "Nucor Corp., the [steel] industry's most profitable [corporation] last year." Nucor Steel is one of our poster firms for timesizing. See our working models page. Evidently the flexibility lent Nucor by telescoping its workweek instead of its workforce is paying off - as much as it can given America's current unwillingness to save its steel industry. Hey, we didn't save shoes, ships or many other kinds of American manufacturing. Why would we save steel (besides that it's strategic)?]

1. French economy added 124,400 jobs in first quarter, Bloomberg May/18/2001 4:10 ET via AOLNews.
   PARIS...- French company hiring slowed in the first quarter as weakening exports led firms to rein in recruiting at the same time as they cut production. Payrolls, excluding government and farm employment, grew by 124,400 jobs, or 0.8%, to 14.855m, an initial Labor Ministry estimate showed. That followed a revised figure of 136,600 jobs created in the fourth quarter of 2000 - the highest since records began in 1970 for the second-largest economy in the 12 countries sharing the euro....
   Expansion Plans
   "In the past four years, we've goine from 200 employees to more than 1,000," said Alain Monoukian, the chairman of clothing chain Alain Manoukian SA. He said he expects to open another 20 stores in France and hire another 300 staff this year. Elsewhere, BNP Paribas SA says it plans to open two new call centers in Orleans and Paris, creating 500 jobs as part of its expansion plans. The bank, France's biggest, plans to hire 2,500 more staff altogether this year.
   As exports, consumer spending and investment rose, France's economy grew at an annual rate of around 3% from mid-1997. In the same period, the jobless rate declined from a post-war high of 12.6% to an almost 18-year low of 8.7% in March.
   Job creation is running at record levels in France as successive governments have introduced greater flexibility to the labor market, notably by cutting payroll taxes for unskilled low-income jobs.
   [Yes, flexibility is good, but what this article withholds until the 19th of 21 paragraphs is sharing the vanishing work via workweek reduction. Astoundingly, mainstream analysts and economists at the dawn of the Third Millennium have placed themselves squarely at odds with common sense and the first two thirds of the history of the Industrial Revolution when working hours went down and wages went up. Why this reversal of the common sense of the Puritan work ethic? One word. Technology. It's whole purpose is to do more with less. To produce more output with less input of manhours. And though near-sighted industrialists did cut jobs during the first two thirds of the Industrial Revolution, the general trend must have been to cut working hours, because at the beginning of the Industrial Revolution we were working from dawn to dusk, averaging 80-84 hours a week (longer in summer, shorter in winter with the varying duration of daylight), while by 1940, most industrialized economies had come down to 40 hours a week. But FDR held a very successful propaganda campaign against sharing the vanishing work in the 1930s, with the result that most smart people since then have become totally time blind where time management impacts aggregate working hours per economy and per person. Supposedly sophisticated gurus from Steve Roach, chief economist and would-be futurist for Morgan Stanley in New York to Lester Thurow, chief pontificator for MIT's Sloan School now that Paul Samuelson's voice weakened with age, routinely ignore workweek length as an economic control variable (or even just an economic variable) or even dismiss it as "tried and failed." (Exactly where and when was that "failure," Lester???) Meanwhile the feisty and vain and wannabe Euro-leading French are the only economy in the world that has the guts or the madness or the intelligence or the vision to try workweek reduction on an economy-wide scale, bless'em. And they're succeeding, no thanks to the poohbahs who repeatedly ignore or downplay the uniqueness and courage of their experiment. And catch this intriguing angle -]
   Labor Ministry economist Frederic Lerais said in a study published in February that, while in the 1980s the economy needed to grow at 2.3% for jobs to be created, the minimum required growth dropped to 1.3% in the last decade.
   Yet signs of an export-led slowdown have brought factory closures and job cuts. In March, industrial production [drawn down by falling demand] declined 0.2% from a month earlier. The job cuts prompted the Socialist-led government to tighten legislation and make it more difficult for profitable companies to ax staff. Parliament will debate a law to this effect [starting] from Tuesday.
   [They always try to zing the key workweek-reduction approach by labelling it "socialist," but the truth is, in France in 1996-97 the rightwing UDF implemented a voluntary company-level version of it for nearly two years. Called the Robien Law, it was very successful as far as it went - in the first six months, 105 firms had taken advantage of its proferred taxbreaks and cut hours to create jobs or avoid layoffs. But unemployment was still up around 12.6%, and despite the squeals of employers, something more sweeping appeared to be necessary. Ergo a four-hour drop in the 39-hour workweek which had already been trimmed one hour from 40 back in 1982. Most of the French are completely oblivious to this fact but this is the most significant area of French leadership in their entire history, and the thing they will be most remembered for, so fundamental and omni-influential is the evolving technology of human sharing.]
   Skills Shortage
   [When, when will we ever learn?! - There's no such thing for the planet's most versatile and intelligent species as a "skills shortage." There is only and always a TRAINING SHORTAGE!]
   The fall in unemployment has highlighted a "skills" shortage [our quotes - ed.].
   [No, we would say it has highlighted the laziness and spoiledness of CEOs in the pervasive labor glut of rampant technological advance crashing against a frozen human workweek. Training has long been the first budget line to get cut in a crunch. It's the bastard child of pompous dot-coms and other self-styled "cutting-edge" companies. After all, they've frequently been flooded with resumes/CVs - why should they bother to - ugh - train?]
   While 2.3m people are still unemployed and the jobless rate is more than double that of the U.S...
   [but then the U.S. unemployment rate is defined so that it doesn't really count anything]
   companies in France still report difficulties finding skilled or qualified staff, particularly in construction, electrical engineering and computing.
   [France has implemented a primitive version of workweek reduction with a rigid target (35 hrs/wk instead of fluctuating vs. under-employment) and no automatic overtime-to-training conversion. Reveillez-vous, les français! Wakey wakey, there's a better way.]
   Bank of France Governor Jean-Claude Trichet has warned that this in turn could engender inflationary pressures as companies raise pay to attract recruits.
   [Yes, it could also centrifuge income out of the unspendable excess of the top 5%, Jean-Claude, spur increased demand and production, and reduce the much-lamented "income gap," not to mention the impact on taxpayers occasioned by people who have difficulty supporting themselves under "les horreurs economique." We have never understood how bankers think industrial production is going to increase without increased demand, and why that increased demand should not be signaled to slow-moving production planners by rising prices that they can get for their output.]
   A separate report released today showed that base pay rose 0.9% on a quarterly basis in the first three months of the after a 0.4% rise in the fourth quarter. On an annual basis, that amounts to a rise of 2.4%, the report showed. Those increases were more than the 0.2% rise in consumer prices during the first quarter and than the rise in the cost of living of 1.3% in March from a year earlier.
   [Tut tut tut. Always the paranoid inflation chicken-littling. Slow inflation is nature's way of eroding the unimaginably astronomical stores of unspendable spending-power hoarded by the top income brackets. As Keynes pointed out, inflation can chug along, and not one man in ten will be able to figure out what's going on. But as long as it's not destructive hyper-inflation, what's going on is - the playing field's getting levelled bit by bit. And if France implements overtime-to-training&hiring conversion, especially for individuals, they'll find they have a built-in inflation control as deflationary incentive is harnessed into the job market to balance inflation incentive. But at least one analyst sees the "other side of the story" on inflation -]
   "This is partly a catch-up after the weak fourth-quarter [inflation] figures and is good for consumer spending in the short term because it represents a boost to real incomes," Deo at UBS Warburg said.
   [But then s/he spoils it with -]
   "It's clear danger for future job creation."
   [How the H can consumer spending possibly be a "danger for future job creation"?! It's the very BASIS of job creation. Anyway, after a forgettable paragraph on the EU Central Bank's inflation paranoia, we finally get to the paragraph on the key, all-points-priority, critical strategy -]
   Prime Minister Lionel Jospin's government has cut the workweek to 35 hours from 39, prompting labor unions to scale back wage demands. The law already applies to large companies and will affect those with fewer than 20 employees as well as government departments next year.
   By Feb. 22, the government said the law has saved or created 347,000 jobs.
   [And many more via the multiplier effect, the added, purse-opening security of French consumers, and the fact that people now have time to shop. See story below on 5/16.]
   Today's report showed that the number of jobs created in the 12 months to the end of the first quarter rose 3.5% to 505,300. The figures cover about three quarters of France's workforce and exclude workers in "non-competitive" sectors, such as the civil service, education and health care.

2. French lawmakers debate draft law raising firms' layoff costs, Bloomberg May/18/2001 6:30 ET via AOLNews.
   French deputies [i.e., MPs, members of parliament] begin debating a draft law next week to make it more expensive and difficult for profitable companies, like Danone SA [570 jobcuts], to lay off workers.
   [These are the near-sighted CEOs that want to "play the float" between when they implement headcount cuts and when those cuts ricochet around and cut their own markets.]
   Social Affairs Minister Elisabeth Guigou last month modified the "social modernization" bill being examined, adding measures to ensure that companies pay as much as 80% of dismissed staff's pay for up to 10 months.
   [The future of this trend is probably to make companies pay ALL the costs of their jerking around their own consumer base, and selling short human versatility by stinting retraining and cross-training.]
   ...The first draft of the modernization law sought to ensure that a company can't lay off workers if it hasn't adopted legislation shortening the workweek to 35 hours. The government amendment now...doubles the minimum severance pay, lays down a longer notice period for job-cut plans and obliges firms closing factories or offices to attract new employment to affected localities....
   [That last one's a bit much. We believe mass layoffs will eventually be completely replaced by hours cuts, except prior to liquidation, while individual firing for cause on a case-by-case basis will become clearer and easier.]

• The Philadelphia Fed releases May business outlook survey, PRNewswire 05/17/2001 10:00 EDT via AOLNews.
  The Federal Reserve Bank of Philadelphia today issued the following:
  May 2001
  Manufacturing firms in the region report continued weakness in business conditions this month. Indiactors of current manufacturing activity suggest no improvement in demand for manufactured goods, and respondents reported reductions in employment...
  [bad]
  and work hours...
  [good - that's the whole point of technology]
  again this month....
  [If all firms trimmed work hours instead of jobs, there'd be no vicious circle of weakening demand and further jobcuts and further weakening demand and further jobcuts and....]

1. French GDP to grow 0.5% in 2nd qtr, central bank says, Bloomberg May/16/2001 10:20 ET via AOLNews.
   PARIS...- The Bank of France cut its forecast for French economic growth this quarter, citing slower sales of manufactured goods at home and abroad, as well as rising stockpiles at factories.... Employment adjustments are being made through short-term contracts and a flexible use of the working week, the bank said....

2. France's 35-hour week prompts long weekends in May, FT says, Bloomberg May/15/2001 21:42 ET via AOLNews.
   LONDON, May 16 - France's new 35-hour week has prompted some workers to take long weekends this month, the Financial Times [FT] said without citing any evidence. Several public holidays take place in May, either on a Tuesday or Thursday, and the French are taking more "bridge days" between the holiday and the weekend because the 35-hour week lets them take days off for overtime, the FT said.
   [To bridge between a weekend and a holiday with 1-2 workdays between is called in France, "faire le pont" = "do/make the bridge."]
   The 35-hour week's effect is "neutral to positive" so far, according to Christel Rendu, an economist at Morgan Stanley Dean Witter & Co.
   [Boy, mainstream economists don't want to give an inch on this, do they?! "Neutral to positive" indeed! And the English-speaking media are going to highlight the least positive assessments they can find.]
   Many companies negotiated more flexible working, low pay increases and shorter breaks in return for implementing the new limit, the FT said. LVMH Louis Vuitton Moet Hennessy SA, the luggage maker, has suffered shortages of goods because of a lack of skilled labor as a result of the 35-hour week, the FT said.
   [Can LVMH spell t-r-a-i-n-i-n-g? The best approach is to make any incidence of overtime trigger, target and fund its own resolution. Overtime-to-training conversion is an obvious feature France should pick up. Right now, France is only implementing among the most primitive designs of workweek reduction. Timesizing is among the most advanced.]

3. Channel ferry line blocked by French strike, Reuters 07:51 05-16-01 via AOLNews.
   RENNES, France...- Five cross-Channel ferries have been blocked in French ports since Monday because of a strike by workers over plans to cut the work week, their operator, Brittany Ferries, said on Wednesday.
   Several dozen passengers and trucks were stranded in the ports of Ouistreham, Cherbourg and Roscoff because of the strike, a spokesman for the company said. Negotiations with trade union representatives were continuing, he added.
   The Socialist-led government's law to reduce the official work week from 39 to 35 hours this year has led to countless strikes across France as managers and unions thrash out the details of exactly how to apply it in individual companies.
   [The activist French are really doing the rest of the world a great favor by prototyping the 35-hour workweek during a period when the rest of the world seems time-blind and completely oblivious to the social deterioration inherent in rolling back gains in the reduction of the workshare per person, alias the workweek. Compared to the French, the rest of us are slave-brained wimps, all to ready to work 24/7 in a stupid "work hard, not smart" doomed "24/7" competition to the bottom against ever better armies of robots.]

• ANALYSIS - French say 35-hour week makes for better lifestyle, by Joelle Diderich, Reuters 06:59 05-15-01 via AOLNews.
  PARIS...- Most French people say their lifestyle has improved thanks to shorter working hours, with many using their extra leisure time to dine out more often, take last-minute trips and spruce up their homes.
  Just over a year after the work week was cut from 39 to 35 hours, the reform is also helping to sustain historically high levels of consumer confidence, helping the euro zone's second largest economy stave off a global slowdown.
  A Labour Ministry study released this week showed that 59% of workers polled felt their daily life had improved as a result of the shorter hours, one of the leading reforms brought in by the Socialist-led government elected in 1997.
  "Staff who reported an overall feeling of improvement in their living conditions (both at work and outside) were those who were able to benefit from a half day or full day off on a regular basis, or from extra holiday time," it said.
  With firms individually negotiating the switch to shorter working hours, just over a third of workers have been granted extra days off - on average 16 per year.
  Of those, the majority are taking Fridays off to take care of chores, leaving the weekend free for gardening, home improvement or spending time with the family.
  Leisure sector sees boom
  A survey by pollsters Ipsos in March suggested the shorter working week was driving the French into stores, where they might pick up a DVD player or a new pair of shoes away from the weekend throngs, although the impact was hard to quantify.
  Impulse buyers were typically on higher incomes, it noted.
  "With the 35-hour hour working week, you spend more: you go to the restaurant more often, to the cinema," Christine Fuchs, a 45-year-old occupational trainer, told the daily newspaper Le Parisien. "I am also more tempted to buy clothes and books."
  Leroy Merlin, the country's second largest do-it-yourself dealer, has reported a boom in interest in its short television spots showcasing ideal homes, with customers asking for more specific instructions and in-store demonstrations.
  Business is also good for travel agents, who have seen a rise in demand from workers anxious to escape the miserable weather in France for a short break in the sun.
  "We have indeed seen an enormous change in this sense," said a spokeswoman for tour operator Go Voyages, which sells flights on the Internet. "It has led to more last-minute sales because some people take a day off ahead of the weekend."
  Nicolas Claquin, an economist at CCF bank in Paris, said that while the shorter working week has had no clear impact on household spending figures since its implementation in February 2000, it was indirectly boosting consumer confidence.
  "It has an indirect effect because what has supported household confidence is really the improvement in the labour market, and this is linked to the 35-hour week," he said.
  With three public holidays on weekdays, May 2001 is setting a peak for long weekends. "Compared to previous years, there are many more people going on holiday," said Stephane Deo, economist at UBS Warburg in Paris.
  However, he noted that people like him faced a problem adjusting economic data to reflect the changes in work patterns. "The risk is to under-estimate the effect of the 35-hour week and to not sufficiently adjust for the drop in production."
  NOT EVERYONE WINS
  The consumer confidence index, which registered its first ever positive reading in April 2000, has since dipped into negative territory but remains at historically high levels.
  Meanwhile, the jobless rate hit an 18-year-low of 8.7% in March, a dramatic reduction from a 12.6% unemployment rate which Socialist Prime Minister Lionel Jospin inherited when he came to power four years ago.
  However, not everyone has come out a winner.
  The Labour Ministry survey found that whereas female executives were most likely to praise the new law, low-skilled workers felt they had [received short shrift], with many having to take pay cuts in exchange for shorter hours.
  [Hang in there. As shorter hours mops up under-employment, market forces will push all wages up.]
  In addition, a quarter of workers reported rising stress levels levels as they try to cram the same tasks into shorter hours...
  [They have employers who don't "get it." The whole point is to spread the work, not concentrate it. Because spreading the work spreads the income, and spreading the income spreads and activates the spending power. And that in turn boosts domestic demand and general markets.]
  ...or acquire new skills to fill in for absent colleagues.
  [This is a puzzle. Why are there "absent colleagues"? Could this refer to employers who cluelessly think that, despite pervasive worksaving technology and rising domestic markets, think that shorter hours are costing them money and so they downsize to "cut costs"?]
  The survey was conducted between November 2000 and January 2001 and questioned a cross-section of 1,618 workers who had benefited from reduced working hours.