Reduced working hours in Ramadan entail costs for Muslim countries

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An interesting study conducted by a research and advisory company, DinarStandard, estimates that the economic loss in monthly GDP owing to reduced working hours in Ramadan is around 7.7 per cent in Gulf Cooperation Council (GCC), Pakistan and Egypt, while in Indonesia and Malaysia, the average monthly GDP loss is 3.8 per cent.
Findings of the study:
The study titled “Survey of Productivity in Ramadan 2011” indicates that estimated loss in monthly GDP due to reduced working hours in Ramadan is the highest in Saudi Arabia. It calculates that the average reduction of two hours in the workday in Saudi Arabia cost a monthly GDP loss of $2.409 billion. In the United Arab Emirates (UAE), the estimated loss due to reduced working hours stands around $1.476 billion; while in Egypt, Pakistan, Kuwait, Oman and Bahrain shortened workdays cost monthly GDP a loss of $1.403 billion, $1.121 billion, $949 million, $296 million and $138 million, respectively.
The research highlights that in all Muslim-majority countries, the month of Ramadan witnesses a reduction or an adjustment of working hours and in some states, work reduction or adjustment is mandated by the government. It points out that some countries leave scheduling at the discretion of the employers, and others mandate government office hours, while permitting the private sector to use its own discretion.
The study evaluates the general differences in approach towards Ramadan work hours in 11 countries of the Organisation of Islamic Cooperation (OIC), including six GCC states (Saudi Arabia, Qatar, Oman, UAE, Kuwait, Bahrain), Egypt, Turkey, Pakistan, Indonesia and Malaysia.
Loss in terms of monthly GDP:
It points out that for those countries that on average have a two hour reduction in their workday (GCC, Pakistan, Egypt), total hours lost are approximately forty, which is essentially equivalent to one week of economic productivity. Percentage-wise, this averages to a 7.7 per cent loss in such a country’s monthly GDP value. For those who average a one hour workday reduction (Indonesia and Malaysia), the total lost hours are twenty, which averages to a 3.8 per cent loss in those economies’ average monthly GDP value. However, the study notes that this assessment does not consider Eid holidays at end of Ramadan.
The research also gives some beneficial insight on how employers can support Muslim employees in honouring their religious commitments. It indicates that the survey responses reveal that most Muslims fast during Ramadan, and those who fast do see an increased level of spiritual activity for which the respondents value employer flexibility. It points out that around 77 per cent respondents say they try to maintain the same level of work productivity during Ramadan and feel that work should continue uninterrupted. Also, although there are no specific religious injunctions on reducing work hours, increased spiritual activity is to be expected and accommodated. Reduced or flexible scheduling is especially important for work that requires severe physical labour.
Muslim majority OIC based employers:
The research points out that most OIC based employees (74 per cent) said they were happy with their employers’ flexibility during Ramadan. At the same time, over 25 per cent have higher expectations from their employers. The survey highlights areas in which OIC based employers can improve their efforts to support Ramadan and productivity include: organising Iftar and Eid gatherings and gift-giving and arranging for special Ramadan working hours, prayer times and facilities. Though, special hours may not necessarily mean a reduction of hours but an adjustment with consideration to key prayer times and Iftar. It also highlights that around 61 per cent of respondents from OIC countries said their company’s productivity does not suffer during Ramadan, a sizeable 26 per cent said their company’s productivity unnecessarily suffers. This should be a cause for companies to evaluate their practices and policies, the study suggests.
Non-OIC based employers
The survey finds out that contrasted with OIC based employees, non-OIC based employees were less happy with their employers’ flexibility during Ramadan (48 per cent vs 74 per cent). Although it is commendable that a good percentage of non-Muslim majority based companies do accommodate for Muslim needs, the gap does present HR departments within these companies’ opportunities to engage with their Muslim employees to impact not just goodwill but productivity.
Most Muslims during Ramadan expect to be as productive as they would be at any other time. However, the survey results show that they engage in added spiritual activity that reduces physical energy. Any accommodation of this reality is expected to increase goodwill and productivity.
The study highlights that a big percentage of non-OIC based respondents (49 per cent) expressed desire for employees to set special Ramadan working hours. (Special hours may not necessarily mean reduction of hours but an adjustment — for example, providing an early start and an early end to the workday.) 25 per cent of the respondents stated that their employers provide special working hours. Around 38 per cent also expressed an interest in special prayer time or facility. Additional, but less prioritised requests include activities such as organising Iftar and Eid gatherings.
Recommendations for OIC member govts:
The study points out that governments in many OIC countries set the tone for productivity across all institutions within their countries. Work-hour analysis shows a few different approaches of some OIC countries, which opens the question as to which models are most effective in delivering the right balance of work productivity and employee satisfaction. However, the economic impact assessment shows that the economies suffer roughly four per cent in monthly GDP per hour per day of work reduction.
Undoubtedly, no dollar value can be placed on spiritual gains and divine blessings of increased worship during Ramadan, but the fact that there are different approaches to work-hour reduction and adjustment does suggest that governments should evaluate whether their Ramadan policies maintain the right balance of work responsibility and spiritual flexibility during Ramadan, the study concludes.