1/5 is 4 days a week instead of 5. If labour is 100% of your company’s costs, then yes you are facing a 20% increase in costs. 100% labour businesses are VERY

1/5 is 4 days a week instead of 5. If labour is 100% of your company’s costs, then yes you are facing a 20% increase in costs. 100% labour businesses are VERY rare. It is also very unlikely that cutting hours by 1/5 (while keeping wages stable) would result in a 1/5 loss in productivity. There is so much time wasted in the typical 9-5 workday because nobody can be productive for 8 hours straight. So if you have a business that’s near 100% labour costs, and the work is such that productivity is very nearly equal ti hours spent working, and your margins can’t take a 20% hit, then yes you are going out of business. There are whole classes of business that would work if 50 or 60 hour work weeks are legal to mandate - but we don’t care... why do we care about that thin slice of businesses that require a 40 hour work week? 32 hours or bust.