Sri Lanka’s economic revival: Traditional 8-hour workday or 6-hour workday?

Sri Lanka’s path to economic recovery owes much to the commendable leadership of President Anura Kumara Dissanayake (AKD) and his dedicated team. Their focus on structural reforms and anti-corruption measures is laying the foundation for a more resilient and equitable economy.

Amid these transformative efforts, a thought-provoking question emerged on social media recently: Should Sri Lanka retain the traditional eight-hour workday or explore a shorter six-hour workday? This debate touches on broader concerns about labour productivity and its critical role in driving economic growth.

Solow Growth Model and Cobb-Douglas Production Function

Labour productivity is a fundamental driver of economic progress, directly influencing GDP growth and national prosperity. According to the Solow Growth Model of Economics, long-term economic growth is fuelled by labour growth, capital accumulation, and technological advancements.

Furthermore, the Cobb-Douglas Production Function, a widely recognised economic framework, underscores how output depends on the interplay between labour and capital inputs. Productivity improvements—whether through skilled labour, better technology or efficient resource use—are essential to maximise output.

Female labour force participation 

For Sri Lanka, enhancing labour productivity is particularly urgent. Female labour force participation remains alarmingly low at 32.1% for 2023 (World Bank), significantly below regional peers such as Bangladesh, Nepal, and Vietnam. Increasing women’s participation in the workforce could unlock immense economic potential but would require addressing structural barriers, investing in childcare support, and promoting flexible work arrangements.

Brain drain

Further complicating this task is the ongoing issue of brain drain, where highly skilled workers are migrating to other countries in search of better opportunities. This exodus diminishes the pool of talent within the country.

Sri Lanka’s ageing population

According to the World Bank, 12.3% of Sri Lanka’s population is aged 60 or older, the highest proportion of elderly individuals in South Asia. The Western Province has the largest concentration of older adults at 31.7%. Within 15 years, over 25% of Sri Lanka’s population will be above the age of 60. 

A shrinking labour force places immense pressure on the economy to maintain productivity, necessitating measures such as encouraging active aging, extending retirement ages, and leveraging technology to bridge workforce gaps.

Highest numbers of public holidays

Adding to these complexities, Sri Lanka boasts one of the highest numbers of public holidays globally, with approximately 25 holidays annually, reduce the number of working days, potentially impacting overall productivity. In the context of brain drain and the need to maximise workforce efficiency, this abundance of holidays raises questions about economic priorities.

Work hours: A global perspective

The debate over work hours varies significantly across countries based on their economic circumstances. The eight-hour workday is widely practiced in developing economies, designed to maximise output while aligning with global norms. Retaining this system in Sri Lanka is practical at this juncture, ensuring wage stability, optimising resource utilisation, and maintaining productivity. 

In contrast, advanced economies such as Sweden have experimented with six-hour workdays, reporting higher employee satisfaction and efficiency. However, these nations benefit from robust welfare systems and advanced infrastructure that enable them to sustain such experiments—a luxury Sri Lanka cannot afford at present.

Examples from post-War Japan and South Korea

Interestingly, countries that have successfully recovered from economic crises have often relied on longer work hours to fuel growth. Post-war Japan used extended workdays to rebuild its economy. Similarly, during its financial crisis in the late 1990s, South Korea adopted longer hours to drive exports and industrial growth, achieving remarkable resilience. These examples highlight the critical role of workforce engagement and productivity in overcoming economic challenges.

Our priorities 

The immediate priority must be on scaling up production, attracting investments, and ensuring economic stability. The eight-hour workday is crucial to maximising output in key sectors like agriculture and manufacturing, providing wage stability for workers, and aligning with global trade norms to attract foreign direct investment. 

Shifting to a six-hour workday prematurely could disrupt industries reliant on full-day labour and impose high transition costs on businesses already navigating a challenging economic environment. For now, the eight-hour workday stands as a cornerstone of the nation’s recovery strategy, offering a practical framework to maximise productivity and support growth.

Looking ahead

Sri Lanka’s journey toward economic recovery is complex and retaining the eight-hour workday is the most logical step in the current context, allowing the nation to maximise productivity, foster workforce stability, and attract critical investments. 

(The writer is a Financial Analyst at a General Hospital Foundation in Ontario, Canada. With extensive experience in management and strategy, he has held senior leadership roles in both the private and public sectors in Sri Lanka. Zahran is a graduate of the prestigious Chartered Institute of Marketing (CIM), holds a Science degree from Wayamba University of Sri Lanka, and has earned a postgraduate qualification in Finance from Ontario, Canada. He could be reached via email at [email protected].)