Iceland’s Four-Day Workweek Experiment: Six Years of Lasting Benefits and New Insights

In a groundbreaking move that challenged traditional labor norms, Iceland embarked on an ambitious experiment to shorten the workweek to four days while maintaining full salaries. What started in 2015 with a trial involving just 2,500 employees has since influenced work schedules for the majority of Icelandic workers. The findings have defied expectations and are reshaping global perspectives on workforce productivity.

A Nationwide Experiment Yielding Remarkable Change

Between 2015 and 2019, the Icelandic government teamed with the Reykjavík City Council to conduct trials that cut the usual 40-hour workweek down to 35 or 36 hours without lowering wages.

This pilot engaged around 1% of the labor force, spanning diverse roles, from early childhood teachers and office employees to healthcare workers and social service professionals.

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Instead of compressing full-time work into fewer days as in Belgium’s model, Iceland’s approach focused on reducing wasteful practices. Streamlining administrative tasks, cutting unnecessary meetings, and prioritizing key work allowed employees to make better use of their reduced hours.

The result was a significant boost in both the quality of work and workers’ overall job satisfaction despite fewer hours on the clock.

Enhanced Well-Being Accompanied by Steady Productivity

The effects of the trial were quick and wide-ranging. Studies led by UK’s Autonomy think tank and Iceland’s Association for Sustainable Democracy (Alda) verified that “productivity remained the same or improved in the majority of workplaces.”

Workers experienced reduced stress levels, lower chances of burnout, and greater opportunities to pursue personal interests, family time, and leisure.

The trial’s success prompted labor unions to renegotiate terms, enabling 86% of Iceland’s workforce to adopt shorter working hours for the same pay or secure the option to do so under new agreements.

Autonomy described the shift as “an overwhelming success,” highlighting the public sector as a key player in embracing shorter work schedules.

Economic Strength and a Shifted Perspective on Efficiency

Contrary to concerns that shorter weeks could harm the economy, Iceland’s economic indicators are strong. By 2023, unemployment remained low at 3.4%, while GDP growth reached 5%, indicating that reduced hours either sustained or enhanced output.

The trials revealed that a refreshed workforce is more engaged and efficient. Employers observed increased focus and motivation, while employees reported better health and improved social connections.

Far from diminishing profits, many organizations saw gains fueled by a happier and more durable workforce.

Iceland’s Model Inspires a Global Movement

The success in Iceland has spurred interest worldwide. Countries like Spain have launched multi-year experiments with thousands of employees exploring shorter work hours.

Germany and the United Kingdom are also experimenting with reduced workweeks, tailoring their pilots to local labor environments. Meanwhile, in New Zealand, companies such as Unilever have introduced policies offering a 20% cut in hours without a salary decrease.

Although these international initiatives differ in execution, they demonstrate a growing global effort to rethink traditional notions of work and productivity.