Working time accounts and firm performance in Germany

Lutz Bellmann,Olaf Hübler

doi:10.1186/s40174-015-0048-8

Abstract

This study investigates whether working time accounts affect the performance of German establishments based on the Establishment Panel from the Institute for Employment Research. The major results are: productivity and investments are positively correlated with working time accounts. No significant effects of working time accounts can be detected on wages and on operating surplus. On average, we find a tendency towards negative effects on profits. This result is less likely in phases of low product demand and for export-oriented, large establishments with a high share of skilled workers. Under strong sales fluctuations, we find positively significant effects on the operating surplus. JEL: C22, D21, J21, J22, J24

Highlights

The discussion of flexible working time has a long tradition in the economic, psychological and sociological literature (Berg et al 2004; Crompton 2002; Dex and Scheibl 2001; Houseman 2001; Kelliher and Anderson 2010; Orpen 1981; Schein et al 1977)
In addition to the positive Working time accounts (WTA) effect, we find that labor hoarding significantly reduces productivity, while relocations and reorganizations enhance productivity
The intention of our paper is to demonstrate that WTA influence the business processes through different channels

Summary

Introduction

The discussion of flexible working time has a long tradition in the economic, psychological and sociological literature (Berg et al 2004; Crompton 2002; Dex and Scheibl 2001; Houseman 2001; Kelliher and Anderson 2010; Orpen 1981; Schein et al 1977). Negative effects of WTA are to be expected if employees use this flexible working time instrument at different times than the employer desires. Further insights into effects of flexible working hours on employees are provided by Possenriede (2014) using Dutch household panel data from 2002 to 2010 He finds that the moderate use of flexi-time does not affect employer-paid training and promotions, except for female workers. Empirical investigations on WTA effects based on IAB Establishment Panel data are carried out by Bellmann and Gerner (2011); Gerner (2012) and Balleer et al (2014) These studies are focused on the influence of WTA on economic establishment indicators during the Great Recession.

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Methods and econometric results

Conclusions

Findings

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