From 1870 to 2000, the workweek length of employed persons decreased by 41 per cent in industrialized countries. The employment rate, employment per working age person, displays large movements but no clear secular pattern. This motivated the question: What accounts for the large decrease in the workweek length and developments in the employment rate over the past 130 years? The answer is given in a dynamic general-equilibrium model with supervisory and production workers. Over time, both types of workers become more productive. In a calibrated version of the model, productivity gains of supervisors account for a large fraction of the decline in the workweek length in Japan, the United Kingdom, and the United States. The model, augmented to include taxes, government spending, and technological progress, captures the movement in the employment rates of the three countries.
