Businessman with laptop working on corporate jet. Photo: Hero Images (Getty).
There is somewhat of a stigma regarding wealthy people that they do less and reap all the benefits. Most importantly, the R&R. And up until around the early 2000s, it was a much more accurate belief. But it appears the scales are gradually beginning to tip, and raking in the dough isn’t quite as carefree as imagined.
While the relatively recent shift in “income versus leisure time” can be attributed to many factors, it’s mostly due to what economists refer to as the “substitution effect.” In layman’s terms, time is money. Hence, since around the 1980s when salaries for the well-off skyrocketed and those below the median either stayed put or dropped, taking time off has simply become too costly for individuals swimming in dollar signs. To put it another way, someone putting in 55+ hours back then earned around 11 percent more than their 40-hour-a-week counterpart. By the turn of the century, the number was 25 and growing.
Rich People Do More Work And Have Less Leisure Time
To paint an even clearer picture, take this example: in 1965, rich folks (traditionally men with college degrees) had more free time on average than those who simply finished high school. Yet, according to the American Time Use Survey, people with bachelor’s degrees or higher are now working several hours longer each day in comparison. Call it the price of inequality. In order to continue to prosper, the most successful among us must put in the time and effort to stay ahead of the competition in order to make any sort of significant profit. Those below the median, on the other hand, won’t necessarily be rewarded for working harder or longer. So why bother?
Obviously, you’re now thinking to yourself, “Wouldn’t all the extra money satisfy their yearning for material things and make rich people work less once it’s attained?” The “income effect,” as it’s known, is simply an outdated idea in present times. In the past, leisure time was considered a status symbol, often used by the wealthy to engage in “exploit” — challenging or creative endeavors like writing and philanthropy. Nowadays, most high paying jobs are less mundane, and exploit is its own reward through the work being done. In other words: they enjoy how they make a living and would likely be doing something similar in their free time anyways. “Passive leisure” such as watching TV or playing video games is now something seen as beneath the wealthy — household incomes of $100,000 or more — which would explain why a 2006 survey showed that they engage in 40 percent less of such activities in their spare time than people making $20,000 or less annually.
But hey, the good news for everyone is that working hours across the board have fallen over the last century, so at least we’re all getting more time to relax in whatever manner we see fit. And if we learned anything from The Shining, that’s probably not the worst thing in the world.