Flexible working hours improve job satisfaction

home officeTemporal and locational flexibility (TLF) is an important element in current policy debates about working conditions and the combination of work and private life. More flexibility provides employees with a greater scope to reconcile their professional, private, and family lives. Furthermore, TLF is expected to increase female labor participation and reduce skilled labor shortages.

From a theoretical point of view, many advantages are conceivable: TLF provides employees with more control over their working life, leads to a better match between paid work and other activities, decreases the amount of stress experienced by employees, and signals to workers that their employer cares about their well-being and their responsibilities outside work.  Since higher job satisfaction translates into fewer job quits and lower absenteeism, it is not only beneficial to employees, but should also be a key concern for employers.

In a new IZA Discussion Paper Daniel Possenriede and Janneke Plantenga analyze whether flexibility in the work schedule (flexi-time), location (telehomework) and duration (part-time) improves the work/leisure balance and increases employee’s overall job satisfaction. They use panel data on Dutch households with self-reported measures of job satisfaction. In the sample, 39% of the employees report freedom to determine the start and end times of their work, and 17% work at home at least once a week.

The analysis finds that a flexible work schedule is positively associated with both working-time fit and job satisfaction. Surprisingly, the effects are not stronger for employees with family responsibilities, who would be expected to struggle more with the combination of work and private life than other groups of workers.

Telehomework or location flexibility is also related to higher job satisfaction, although to a smaller extent than flexible working times. Part-time work increases working-time fit similarly to flexi-time, but it sometimes even has a negative effect on job satisfaction for women – contrary to some previous empirical findings. Overall, the results indicate that schedule flexibility may be a superior alternative to duration flexibility.

Read abstract or download discussion paper.

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