Why Raising Productivity Does Not Leave You With Free Time: The Empty Slot Is Visible as Demand

You rarely come across someone who raised their productivity and ended up with time on their hands. There is no shortage of advice on how: set priorities, work in blocks, take proper breaks, get the tools together, improve your skills. All of it genuinely works, and the volume you can get through in the same hours certainly increases. Even so, the busyness does not go down.

The cause is neither that you failed to keep it up nor that you went about it loosely. Efficiency yields no free time. What it yields is capacity to take work. Three open hours have a face you see and a face the business sees. When a judgement is made, the face consulted is the second one, and which one you consult is not yours to pick.

Three questions get answered here. Why the months with the most efficiency work are the months where the hours are full. When exactly you started accepting the small enquiries you used to decline as not worth it. And where to look next when getting more deft leaves you just as chased as before. None of the three can be explained by a quantity of will.

What this article cannot produce goes in as well. What share of the gain should go to new work is not settled here. With different fixed costs and different living conditions, the same share means something else. Some can put half of it in; for others a tenth is the limit, and which is right cannot be said without looking at the numbers on the business side. Nor does this cover the state where the hours simply cannot come down — the phase where fixed costs eat most of turnover. There, the cost side comes before the destination of any slot.

The damage sits in this state being displayed as a success by the measure. Turnover has grown with the added jobs. The hours are the same and you earn more than before. The numbers have improved, and no mechanism anywhere warns of deterioration. The warning comes from the opposite side: in a month where time went into making something new, the productivity figure falls.

What follows begins by identifying what actually opens up when productivity rises. It then places what productivity refers to in a one-person business and sorts the techniques on offer into two layers. From there it takes the relation between efficiency and total volume from an observation in economics, and looks at the particular circumstance that an empty slot is visible from the demand side. It then places why an undeletable portion remains, gives three reasons for raising productivity even so, and ends with the procedure for deciding where the gain goes.

What Actually Opens Up When Productivity Rises

Leisure is not what efficiency produces. Capacity to take orders is. Capacity goes on existing as capacity until it is filled.

Say a task took eight hours. You put the sequence in order, got the tools together, cut the waste, and the same task now finishes in five. Productivity rose. That much is the same for anyone. The question is how those three hours get handled.

In a job, those three hours tend to get filled with other duties. The finishing time does not change, so something goes into what opened up. Working for yourself, matters are a little more complicated. You decide the finishing time, so in principle you could leave all three hours clear.

In practice it does not go that way. The reason is that those three hours look like “time that opened up” to you and like “one more job I could take” to the business. They are the same three hours; the face consulted at the moment of judgement differs.

And the judgement never arrives in the form “what shall I do with three hours”. It arrives as “shall I take this enquiry”. By the time the enquiry comes, three hours of slack are in hand. No grounds for declining are in view.

Accepting is the correct judgement every time, taken one job at a time. Turnover rises, the relationship continues, and there is no disadvantage in declining. The three hours fill up as three hours’ worth of that correct judgement accumulating. No moment where the judgement went wrong can be found anywhere. Searching turns up nothing because no error occurred.

The state after filling is worth seeing accurately too. Turnover has grown with the job count. Nothing deteriorated. You earn more than before and the hours are the same. On the measure, this is a success.

Yet nothing has changed as far as you can feel. The discrepancy is not an illusion. The measured thing improved and the unmeasured thing stayed where it was. What stayed put is the side of what remains when the work stops.

And the growth in job count has added one load that is hard to see. The number of things to be managed grows. Go from five jobs to eight and tracking progress, the channels of contact and the processing of invoices are all eightfold. This time is not easily booked to any job’s working hours, and it certainly occurs. After filling, the state is not what it was before but the same hours with a management load laid on top.

Working Alone, You Hold Both Sides of “Productivity”

Productivity is the ratio of output to input, and in a one-person business the same person decides both sides of that ratio. This single point makes the difference from a factory.

In a factory it is units produced per hour of labour. In a one-person business it comes out as the volume of work processed per hour worked. What needs attention is that in a factory, even when productivity rises, how much to make is decided by another department. In a one-person business the person who raised productivity also decides how much to accept. Because the two sit inside one person, the route by which a rise in productivity converts directly into a rise in orders is open on the inside.

Also, “output” in a one-person business mixes two different contents. One is the count of enquiries completed. The other is the volume of things made that keep generating worth without any enquiry. The word productivity normally refers only to the first. How many were processed per hour: that is the measurement.

The second, however, looks close to zero in productivity while it is being made. Time goes in and the completed count does not grow. On the measure, working on the second appears as a fall in productivity.

The asymmetry comes out of how the measure is designed. Where there is a time lag before output arrives, the numerator stays at zero during that period while only the denominator grows. So the ratio falls. This is not a miscalculation; it is behaviour exactly as defined.

In a factory this lag is handled as capital investment in a separate account. Nobody objects that productivity is low during the period when the line is stopped and machines are being replaced. Making equipment and using equipment to make things are on separate books from the outset.

Working for yourself, the two are not separated. Inside the same day sit the time spent completing enquiries and the time spent making something that generates worth without enquiries. Unless recorded separately, both go into the same denominator. Investment gets booked as a fall in productivity. This is the circumstance peculiar to working for yourself.

There is a form of it that shows up constantly in practice. The busier the month, the better the productivity figure looks. A month with many jobs and full hours produces a high volume processed per hour. A month where time went into making something new produces a lower figure.

What follows deals with productivity in the first sense — volume processed per hour. That is also the sense the advice on raising it addresses. The range is narrowed because inside that range the list is accurate. The point is not to fault the list but to see what happens outside the range the list addresses.

The Techniques Split Into Recovering and Shortening

The techniques lined up fall into two layers, and one of them has a definite ceiling. Without the split, hitting the ceiling gets read as a failing of your own.

Lay them out. Set priorities. Work in timed blocks. Take proper breaks. Bring work forward. Batch similar tasks. Bring in tools or systems. Improve your skills. Delegate what can be delegated.

The first layer recovers time that is being lost. Prioritising, focus techniques, how breaks are taken, batching. What these reduce is time spent hesitating, time spent switching, time spent stalled through tiredness. Time that was not going into the work itself goes into the work.

The second layer shortens the work itself. Bringing in tools, improving skills, handing work to others. These touch the content of the work.

The split matters because the first layer has a clear ceiling. Time being lost is finite. If two hours a day disappear into hesitation and switching, two hours is the maximum recoverable. Once it is all recovered, no more comes out. This recovery can be largely complete early on. That is also the period when the effect tends to feel dramatic.

The second layer has no ceiling as definite as the first. Better tools, higher skill, wider delegation. These stack. But it has a different property. The input needed per unit of improvement grows as you go. The first tool works dramatically; the next one less so. Skill is the same: early gains are large, and later the same increment of improvement takes longer.

The split matters in practice because the size of effect you can expect differs by which layer you are working in. In the first layer, the return feels large against the effort put in. That period’s experience is what builds the conviction that raising productivity works. Carry that conviction into the second layer and, since the same effort returns less, you conclude that you must be going about it wrongly.

It is not a matter of method. The recoverable time is finite and most of it has already been recovered. Mistake this and you keep digging a well that has run dry.

And time gained in either layer flows to the same place if its destination is undecided. Time recovered in the first layer and time shortened in the second both become capacity to take orders, without distinction. Different origins, same destination.

Efficiency Raises the Total — The Relation Observed in Coal

When efficiency rises, the relative cost of using the thing falls, and uses that did not pay before begin to pay. More uses means a larger total.

This relation has been observed in economics for a long time. In The Coal Question of 1865, William Stanley Jevons made a point about coal consumption that ran against the common sense of his day. Since steam engines had become more efficient, consumption ought to fall — that was the common sense. James Watt’s improvements had plainly reduced the coal needed for the same work.

What actually happened was the reverse. Greater efficiency increased the number of situations in which coal-fired machinery paid for itself. Industries where it had not added up began adopting it, and the total number of machines grew. Consumption per machine fell while national consumption rose. Jevons wrote that a new method of economy will, as a rule, lead to increased consumption.

The same form has been measured repeatedly since. In 2000 Lorna Greening and colleagues set out, sector by sector from domestic heating to transport, how far improvements in energy efficiency actually translate into reduced consumption (Greening, Greene & Difiglio, 2000, Energy Policy, 28(6–7), 389–401). Even where efficiency improves, part of the expected saving is eaten by increased use. The proportion eaten differs by sector.

This observation is not carried straight over to a person’s working hours. Coal is a resource; working hours are not. What is treated is the mechanism by which demand expands across a market, not the case of a single trader. What can be carried over is the shape of the mechanism.

Applied to your own hours it goes like this. When efficiency rises, the cost of taking on one job — the time it takes from you — falls. As that cost falls, enquiries that were previously too heavy to accept become acceptable. As the range of acceptable enquiries widens, the number accepted grows.

Efficiency, in other words, does not merely finish the same work in less time; it simultaneously widens the range of work that can be taken on. It is the latter that bears on the total.

Say small enquiries used to be declined as not worth it, because a set amount of handling rides on a job whatever its size, so the smaller the fee the larger the share going out. Put the sequence in order and that set amount falls. The line for declining falls with it. A lowered threshold for declining is a correct result of efficiency. As a business you have moved forward. But this advance does not work in the direction of clearing your hours.

What Jevons observed had this shape too. That consumption per machine fell was unquestionably technical progress. Precisely because of the progress, the occasions for use multiplied. The total rose not because efficiency failed but because it succeeded.

So the state of having become busy through efficiency is not the result of a mistaken response. It is the state you arrive at properly, as a result of the response working. Doing the same thing more carefully will not get you out of it.

The Empty Slot Is Visible From the Demand Side

Working for yourself, an opening reaches the enquiring party directly, as the reply “yes, I can take that.” When I was employed, having my hands free never travelled beyond the organisation.

What is visible is visible only to a limited range of people — a manager, some colleagues. Taking work as an individual, the number of people it reaches is not one.

And that reply is necessary in order to keep the business going. Repeat “I cannot take anything now” and the next enquiry stops coming. Where you have not designed the channel through which enquiries arrive, declining one carries the same meaning as thinning that channel.

Here is the structural reason declining is hard. It is not about being an obliging sort of person. In a state where you do not hold the route by which enquiries arrive, accepting the ones that come is the main means of maintaining that route.

And one more thing. In this state, keeping the slot clear costs something. A clear slot generates no turnover if no enquiry comes. If one comes, it fills. Either way, no room is left to put that slot toward something else, because keeping it clear takes the form of doing nothing in case an enquiry arrives.

So raising productivity to create a slot does not complete itself. A slot cannot exist while empty; something necessarily goes in. If what goes in is undecided, what goes in is whatever enters most easily. That is an enquiry.

I went through this sequence during the period when music was my work. At the time I declined almost all low-fee enquiries, because a fixed overhead per job left me out of pocket on small work. As I put the production process in order, that fixed overhead came down. Enquiries of a size I used to decline came inside the range I could accept.

From there, the number of times I declined fell. That the threshold for declining came down was itself evidence that my ability had risen. Even so, the state of affairs at month end was no different from before.

What came back from those around me at the time was that I was being chased because I was still not deft enough. Follow that account and the next thing to do is to get more deft. I did, and I got more deft. If being chased continued after getting more deft, then deftness was not the cause.

The cause was that the destination of the shortened time had not been decided. Time with no destination is, from the enquiry side, an empty slot, and empty slots fill. This rereading is not an ordering of feelings. It changes what you do next. Treat it as a matter of deftness and the next step is polishing deftness. Treat it as a matter of destination and the next step is deciding the destination. No number of laps around the first arrives at the second.

The Undeletable Portion Grows as a Share

Inside the work, a portion remains that the operation called productivity cannot in principle reach. The more the periphery is cut, the larger the share that portion holds.

Push efficiency far enough and, past a certain point, what can be cut runs out. Economics has a description of this. In Performing Arts: The Economic Dilemma of 1966, William Baumol and William Bowen analysed the mechanism by which the costs of the performing arts keep rising, and in doing so divided activity into two. Fields where output per hour goes on improving, and fields where there is no way for it to improve.

The example placed on the second side was the playing of a string quartet. The number of people and the length of time the performance requires do not change however far technology advances. What takes four players thirty minutes still takes four players thirty minutes a century later. In an activity where the delivering is itself the content, there is nothing for the word efficiency to refer to.

Any work where a person hands something to a person contains a portion with this property. The time to hear the other party’s situation. The time to understand what is going on. The time to think about how to handle it. That portion does not get shorter with better tools.

The periphery can be automated. Scheduling, invoicing, preparing materials, filing records. These can be replaced by systems. The core remains. And the share held by the core grows, relatively, the more the periphery is cut. So the returns to efficiency diminish. It works dramatically at first, dulls as it goes, and stops at some point. Where it stops differs from person to person; that there is such a point does not.

What Baumol and Bowen drew from their analysis was a consequence about costs. When wages rise in the sectors where productivity rises, sectors where it does not must raise wages too in order to secure people. Output has not grown and costs alone go up. The phenomenon later came to be called cost disease.

What carries over to a one-person business is not the cost argument but the distinction underneath it. Inside your own work there is a portion the operation of productivity reaches and a portion it cannot reach in principle. Think “more efficiently” without separating the two and you keep applying the same operation to the portion it cannot reach.

And the portion it cannot reach tends to overlap with the core of the work: understanding the other party, thinking, judging. Try to shorten that and the quality falls instead. When efficiency reaches the core, what got shorter is not only the time but also the content of what you are handing over.

From here it becomes visible that two ceilings are acting at once. One is that there is a floor under what can be cut. The other is that the slot opened by cutting gets filled. The first is the limit of efficiency itself; the second is the question of where the result of efficiency goes. They are different matters with different responses. The first needs a judgement to cut no further. The second needs the separate work of deciding a destination.

Why the Comparison With Employees Leaving Early Misses

In employment, a rise in productivity meets the boundary of a finishing time; in a one-person business that boundary does not exist. The same operation gives a different result depending on whether the boundary is there.

People who raised their productivity and started leaving earlier do exist. But look at what is happening in that case and something other than the rise in productivity is at work. A boundary — the finishing time — exists, decided independently of productivity.

Where there is a boundary, a rise in productivity shortens the distance to it. What is shortened comes out the far side. So you leave earlier. The boundary is there first, and the rise in productivity meets it. That is the order.

Working for yourself, no such boundary exists. If there is one, it is only the one you drew. And a boundary you drew yourself is up for renegotiation every time an enquiry arrives. A boundary given from outside and a boundary you drew are different in strength even when identical in shape.

That said, the same thing happens in employment. Work collecting around the person who raised their productivity is widely observed. Even with a boundary, the density inside it rises. So this comparison does not become a contrast between what happens to the self-employed and what happens in a company. The difference is that in a one-person business the total moves as well as the density.

Draw the line here. This is not an argument against raising productivity. You should raise it. Without raising it, the time used to produce the same turnover does not come down. Slack in daily life is created first by raising productivity.

What is being addressed is that raising productivity alone leaves no time. To leave time, an operation other than productivity is needed. That operation is not in the list of techniques for raising productivity, because what the list addresses is volume processed per hour.

The comparison has a variant. If there is no boundary, draw a finishing time yourself. Deciding is certainly possible; there are people who run their business with an upper limit on hours set in advance. But the strength that decision carries is different from a boundary given from outside. Break an outside boundary and a promise to another person breaks. Break your own and nothing happens to anyone.

And the reasons for breaking it appear in a plausible form every time. Just this once, it is urgent. This client matters. Next month will be clear. Taken one at a time, each is sound.

So drawing a boundary works poorly unless it comes coupled with what you put outside it. “Finish at six” alone leaves nothing after six, so extending looks free. With work decided for after six, extending destroys that work. Only once a cost arises does a boundary work as a boundary.

Three Reasons to Raise Productivity Even So

Without a decided destination, the slot merely fills. That is still not a reason to leave productivity alone. There are three reasons.

First, to decide a destination, you need a slot. Decide the destination in advance and nothing happens if there is no time to put into it. Where the hours are full to the limit, what goes to the decided destination stays at zero. Raising productivity is the means of producing what goes there. As a sequence, both making the slot and deciding the destination are required.

Second, a rise in productivity is not reversible. A sequence once put in order and a skill once acquired remain even when enquiries fall away. Unlike much of what this article addresses, they have the property of accumulating. They are among the few things that do not disappear when the work stops.

Third, low productivity reduces your options. Where the time per job is long, the money lost with each decision to decline is large. So you cannot decline. Where the time per job is short, the cost of declining falls. Being able to decline is born as a by-product of productivity.

The third works in the opposite direction to the relation observed in coal consumption. As productivity rises, the range of acceptable work widens and the job count grows. At the same time, as productivity rises, the cost of declining falls and declining gets easier. Two forces act at once, and which wins is decided by whether a destination has been set.

Without one, the first wins, because judged one job at a time accepting looks rational. With one, room appears for the second to work, because the cost of declining now gets compared against the worth of the decided destination.

The third has one further consequence. Being able to decline also bears on price. Unable to decline, you have to accept the amount quoted, because the loss from declining is too large. Able to decline, you can pass on enquiries whose amount does not fit. Where passing continues, the average terms of the enquiries you accept rise.

This improvement does not come from negotiation. The state of being able to choose moves the terms by itself. Polishing negotiating technique is of no use in a state where you cannot decline. Creating the state where it can be used comes earlier in the sequence.

Something is given up in exchange. As the number of refusals rises, that month’s turnover falls. What fell does not come back until the decided destination returns something. How long that takes depends on what you are making. Reading this optimistically would be inaccurate.

And what creates that ability to decline is the rise in productivity. So this article is not dismissing it. It is one of the necessary pieces of work, and it does not complete itself. What completes it is the destination already set.

Decide In Advance Where the Gain Goes

There are only two orders. Raise productivity and then think about the destination, or decide the destination and then raise it. In the first, the gain appears as a slot and fills with enquiries.

Think about the destination after it has filled and there is nowhere to put it. In the second, the destination of the gain is already decided, so when an enquiry arrives the judgement takes the form not of “shall I accept” but of “how does this enquiry compare with what I decided”.

Change what the comparison is against and the judgement changes. In the first, the enquiry’s opponent is “three hours of doing nothing”. In the second, the enquiry’s opponent is “the work I decided on”. In the first comparison, the enquiry tends to win.

As a procedure it goes like this. Before starting the work of raising productivity, decide what the gain will go to and write it down. An amount, a number of hours, or the name of a task will all do. Deciding at all is the requirement.

Why the procedure works: a slot cannot exist while empty. Whatever enters most easily goes into an open slot. An enquiry arrives with three things together: it comes from outside, it has a deadline, and it has money attached. Work not yet decided on has none of the three. On the same footing it cannot win. Deciding in advance is the operation that keeps it off that footing.

The reason for not handing over a level for the share is that the same share means something different once fixed costs and living conditions differ. What is here instead is an account of why “think about it later” does not work. It does not work because what the comparison is against never changes. Grasp that and the share, and the way of recording it, can be rebuilt to fit your own business.

The case where the decided destination is not kept deserves a word too. Failing to keep it is not itself evidence of failure. When the three hours you had set aside fill with an enquiry, at least one thing becomes known. You compared that enquiry with the decided work and chose the enquiry. A record that a comparison took place remains.

Without a decision, no comparison happens at all. Three hours are open, an enquiry arrives, it fills. It fills without your remembering having judged, so there is no material to look back on. The first effect of deciding, then, is not that time remains but that the judgement gets recorded. If the enquiry wins every time for three months running, either the decided destination was only worth that much or the hours have no slack. Either way, where to look next becomes clear.

You rarely come across someone who raised their productivity and ended up with time on their hands. The reason is that the gain appears as a slot rather than as time, and a slot cannot exist while empty. Without a decision about what goes in, what goes in is the thing that arrives from outside with a deadline and a fee attached.

Raising productivity was, in itself, correct work. Without it, the amount to send to a destination never appears in your hands at all. What was mistaken was the premise that raising it leaves time. Swap the premise and the same operation carries a different meaning. Efficiency becomes not the work of producing time but the work of producing the funds to send to work you decided on.

How the operation of raising productivity meshes with the hourly rate as a measure is treated in raising your hourly rate does not make you free, and what decides the ceiling on income in the first place is broken down in what to know before earning on your own: the ceiling on selling time. The circumstance that an empty slot is visible from the demand side comes out of the form of the income itself. The whole picture of that form is in getting out of labour-intensive form.