Comparing Europeans and Americans is dangerous territory, but last week Nicolai Tangen, head of the giant Norwegian oil fund, ventured there. He told the Financial Times there was a difference in the “general level of ambition”. We [Europeans] are not very ambitious. I should be careful when I talk about work-life balance, but Americans just work harder.”
This has been said many times. In the novel by Franz Kafka AmericaIn the novel, published posthumously in 1927, the main character Karl travels from Europe to the USA, where he meets a man who studies at night and is a salesman during the day. “But when do you sleep?” asks Karl.
“Yes, sleep!” said the student. “I will sleep when I finish my studies. For now, I’ll drink black coffee.”
Europeans and Americans do things differently.
Europeans have more time and Americans have more money. It’s an excuse to say what you prefer is a matter of taste. There are three fairly objective measures of a good society: how long people live, how happy they are, and whether they can afford the things they need. A society must also be sustainable, measured by its CO2 emissions, its collective debt and its level of innovation. So which side does it better?
Americans do the equivalent of more than an hour of extra work every weekday compared to Europeans: 1,811 annual hours per American worker in 2022, compared to about 1,500 in Northern Europe, with a low of 1,341 in Germany, according to the OECD. Because Americans are also more productive per hour worked than most Europeans, their average income is higher than in all European countries except Luxembourg, Ireland, Norway and Switzerland.
Earning more is partly an American choice not shared by other nations. As the economy advances, Americans have chosen to spend more. Europeans have remained true to the historical trend: once people pass the subsistence level and have their needs met, they tend to prioritize leisure rather than devoting their lives to maximizing wealth.
As if to illustrate Tangen’s point, HSBC’s UK chief executive Noel Quinn unexpectedly announced his resignation on Tuesday, saying he needed “rest and relaxation” and a “better balance between my personal and business life” after an “intense period “. five years” on the job.
In 1870, the average worker in the industrialized world worked more than 3,000 hours per year, calculated economic historians Michael Huberman and Chris Minns. Today’s Europeans do about half of that.
Average hours per European worker have continued to fall since the pandemic. “Men – particularly those with young children – and young people are driving this decline,” says a recent IMF paper by Diva Astinova and others. It also pointed out, “Decreases in actual hours are accompanied by declines in desired hours.” Today’s young fathers seem to want to spend more time with their children (or at least feel like they should). And surveys consistently show that Millennials and Generation Z want shorter working hours.
This displeases strivers at the top of society like Tangen, who tend to want everyone else to strive too. These people love their jobs, are paid well, employ housekeepers, and probably wish they had spent more time in the office. Emotionally, I have to admit that I am on this team. Due to a recent series of rash decisions, I currently work seven days a week and started writing on a sunny Sunday afternoon.
But workaholic candidates are exceptions. Most people don’t particularly like their job. The polling institute Gallup publishes large-scale international studies on engagement in the workplace. American workers actually show more enthusiasm for their work than Europeans. But even in corporate America, Gallup reported last year, “only about 30 percent of employees are truly engaged.” Another 20 percent are unhappy and spread their misery at work, and 50 percent just show up wishing they didn’t have to work at all – especially in this job.”
In short, most Americans would probably prefer European work schedules. It’s just that their employers and the cost of health insurance are standing in their way. The US offers big prizes for first place and big penalties for last place. That’s partly why Europe exports its most ambitious contenders there.
But few Americans win the big prizes. Many others end up overworked and unhappy, albeit in big houses and cars. In the latest World Happiness Report – a partnership between Gallup, the Oxford Wellbeing Research Center and the United Nations – the US ranked 23rd for self-reported happiness. The Nordic countries took the top spots. As the Swedish political scientist Bo Rothstein noted: “It is now clear that from the many social models tried since the breakthrough of industrialism, social research can point to one winner in terms of human well-being, and that is the Nordic model. “”
Even Tangen seems to like it. He’s taken enough time off to build the world’s largest collection of Nordic modernist art (an activity a typical New York hedge funder wouldn’t do on his own) and is enjoying the holidays at his summer home. From there or another vacation spot, he posted an idyllic photo on LinkedIn of a pizza floating over a fjord with the text: “My hobby this summer is recycling leftovers into lunch pizzas!” Today, the all-time favorite shrimp dish is in Garlic and chili. Wow! Any suggestions for the rest of the week?” Life couldn’t be more European.
The Europeans also win when it comes to the most important indicator of social success: longevity. Spaniards, for example, are much poorer than Americans, but live to an average of 83 years, while Americans live to 77.5 years. Even super-rich Americans only live about as long as the richest Brits, despite being much richer.
There is a right-wing belief that the good life in Europe with short working hours and high pensions is not sustainable. The European states would go bankrupt, it is said, and then the Europeans would have to work like the Americans. The facts suggest otherwise. The U.S. has a higher national debt ratio than almost all European countries: 123 percent, almost twice as much as work-shy Germany and three times as much as Norway, Sweden and Denmark, the IMF reports.
And the US is unsustainable in the most fundamental sense: carbon emissions. Americans use their extra wealth to buy more things than Europeans, drive more, use more air conditioning, and so on. As a result, U.S. emissions were 13.3 tons per capita in 2023, compared to 5.4 tons in the EU, the International Energy Agency estimates.
It’s true that the US is producing more innovations, some of which are beneficial. There is no European Google, Tesla or Facebook. Maybe the global economy needs the USA, or at least some inventive parts of it – as long as you don’t have to live there.