First published December 10, 2021.
Between 2015 and 2019, Iceland ran two large public-sector trials in which about 2,500 workers cut their hours from the standard 40 a week to 35 or 36, with no reduction in pay. A 2021 analysis by the UK think tank Autonomy and the Icelandic association Alda found that productivity and service provision stayed the same or improved at most workplaces, while workers reported less stress and burnout and a better work-life balance. The results were widely described as a "four-day week" success, but that label is misleading: most participants worked a few hours less each week rather than one day less. Here is what the trials actually tested, what they found, and what they can and cannot tell other employers.
Who took part and what changed
The trials were run by Reykjavík City Council and Iceland's national government. Together they covered roughly 2,500 people, which is more than 1 percent of Iceland's working population. Participants worked in a range of public services, including social services, hospitals and schools.
The reduction did not have to take one fixed form. Workplaces could arrange the shorter hours in different ways, such as finishing earlier on some days or taking periodic time off, and the cut was not necessarily compressed into four days. The common thread was a move to 35 or 36 hours, with full wages maintained, which meant teams had to rethink how they organised their work.
What the 2021 report found
The analysis, written by Guðmundur D. Haraldsson of Alda and Jack Kellam of Autonomy and published in mid-2021, drew three main conclusions:
- Output held steady. Productivity and the quality of services either stayed the same or improved in the majority of trial workplaces.
- Wellbeing rose. Participants reported lower perceived stress and burnout and improvements in health and work-life balance. Many described having more time for family, errands, exercise and hobbies.
- Costs stayed neutral. According to the report, the trials were revenue neutral for both the city council and the national government.
Will Stronge, Autonomy's director of research, summed up the political significance by saying "Iceland has taken a big step towards the four-day working week." It is worth noting that Autonomy campaigns for shorter working hours, so its framing is supportive by design. The underlying data, however, came from the government-run trials themselves.
The 86 percent figure, explained
The headline number most people remember is 86 percent. It does not mean that 86 percent of trial participants were happier. It refers to what happened after the trials ended: Icelandic trade unions used the results in collective bargaining, and by 2021 about 86 percent of the country's workforce had either moved to shorter hours or gained the right to do so.
In other words, the trials helped turn an experiment into national labour agreements. That is arguably their most important outcome.
Why "four-day week" is not quite accurate
Many early news stories described Iceland as having trialled a four-day working week. A true four-day week would cut around eight hours from a 40-hour schedule. Most Icelandic workplaces in the trials cut up to three or four hours, and the permanent agreements that followed often reduced hours by about an hour or less per week in some sectors.
So the more accurate description is a shorter working week, with schedules that varied by workplace. That still matters, because it shows that even a modest cut in hours, combined with smarter organisation, can improve wellbeing without hurting services.
How Iceland compares with other trials
Iceland's results helped inspire further experiments elsewhere. In 2019, Microsoft Japan tested a summer schedule with Fridays off on full pay, shorter meetings and smaller meeting groups; the company reported a drop in electricity costs and a rise in productivity, although the details of how productivity was measured were not fully published.
In 2022, a pilot coordinated by the non-profit 4 Day Week Global ran in the UK from June to December with 61 companies and roughly 2,900 employees, who worked about 80 percent of their usual hours for full pay. More than 90 percent of the companies chose to continue afterwards, and 18 made the change permanent. Several firms reported that adapting was harder than expected.
These trials differ in design, sectors and measurement, so they cannot be compared directly. Together, though, they suggest that working time can often be reduced without the losses many employers fear, provided the work itself is reorganised.
Lessons for employers and workers
The Icelandic experience offers practical pointers rather than a universal formula:
- Start with the work, not the calendar. Gains came from removing low-value tasks and meetings, not from squeezing the same workload into fewer hours.
- Let teams design their schedule. A preschool and a tax office need different solutions, and staff involvement helped the changes stick.
- Measure before and after. Tracking output, service levels, sick leave and staff wellbeing makes the results credible.
- Expect limits. Round-the-clock services, such as hospitals, may need extra staff to cut hours, which has real costs.
Iceland is a small country with high union membership and a strong welfare system, so results there may not transfer neatly to larger or very different economies. Still, the trials remain one of the largest real-world tests of reduced working hours, and they shifted the debate from whether shorter weeks are possible to how they can be designed well.
Sources: Autonomy and Alda: Going Public, Iceland's journey to a shorter working week; Wikipedia: Four-day workweek (Iceland, UK and Microsoft Japan trials). Also reported by the BBC.
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