Flextime and Profitability

Abstract

Despite the well‐documented benefits of flexible work schedules (flextime), generalizable assessments of how flextime influences organizational profitability have proven elusive. Using a unique data set representative of organizations in Canada, we examine the effect of flextime in combination with organizational strategies to predict profitability. Using fixed effects and controlling for prior profitability, we find that flextime increases profitability when implemented within a strategy centered on employees but decreases profitability when implemented within a strategy focused on cost reduction.