The announcement that Australian software giant Atlassian will lay off 10% of staff has brought the debate over artificial intelligence (AI) and jobs closer to home.

While a broader question about the usefulness of AI remains unresolved, there can be no remaining doubt that it has transformed the software industry, with developers reporting massive increases in productivity from the use of Anthropic’s AI-powered coding tool Claude.

The spectre of AI-driven job losses has been the subject of much debate. But missing almost entirely from this debate is the idea that the increased productivity associated with AI should deliver a reduction in working hours, rather than an increase in wages or, more likely, corporate profits.

Concerns around the loss of jobs to new technology dates back to the Industrial Revolution and the machine-smashing riots led by “Luddites”. Workers at the time were right to revolt. The initial effect of the factory system was not only to destroy the cottage industry of handloom weaving but to drastically increase the hours and intensity of work. Average working time in Britain reached nearly 70 hours a week in the early 19th century, with some factory workers doing as much as 12 hours a day, six days a week.

But from the middle of the 19th century to the late 20th century, the benefits of technological progress were reflected in steadily reducing hours of work. Australia and New Zealand led the way with the achievement of the eight-hour day beginning in the 1850s. Over the next 100 years, standard weekly hours were reduced from 48 hours to 44 and then to 40. The weekend, now taken for granted, was only achieved by Australian workers in 1948. The process was driven by unions and government, against the resistance of most employers.

By 1980, the Australian Council of Trade Unions launched a push for a 35-hour working week. But the balance of power had changed, with unions much weaker, and governments, both Labor and Liberal, taking the side of employers. Standard hours were reduced to 38 per week, where they have stayed ever since. Annual leave, increased to four weeks under the Whitlam government, has also remained unchanged.

Forty to 50 years later, these conditions have been in place so long that they seem like the natural order of things. As a result, discussions of the impact of AI take for granted that any reduction in total hours worked translates directly into a loss of jobs.

But the sudden arrival of remote work since the start of the pandemic has shown us that it’s possible to radically change our way of working. Millions of us shifted overnight from a standard five-day week to work from home and, to the disbelief of many, the resulting disruption was minimal. When lockdowns ended, employers issued decrees demanding a return to pre-pandemic norms, but were unable to enforce them. The proportion of people doing at least some work from home has barely changed since.

While bosses used to push for workers to continue working at home outside standard hours, the introduction of the legal right to disconnect, combined with changes in social norms, has pushed back against this form of work intensification, with reports some office workers have quietly started taking Friday afternoons off, partially or wholly.

But these benefits have been far from universal. Jobs requiring physical presence, such as retail and transport, have barely changed. Jane Hume’s proposal, during the 2025 election, to stop remote work in the name of equity was a distorted reflection of this inequity. The Albanese government has declared its opposition to a four-day week and has offered nothing positive on this front. Only the Greens have supported the ACTU in reviving campaigns for shorter working hours. State premiers such as Chris Minns and Peter Malinauskas have sought to curtail remote work.

There’s little doubt now that AI will produce real productivity improvements. But there’s no guarantee that most of us will share the benefits of these improvements. A return to the long-paused process of gradual reductions in working hours is urgently needed.

• John Quiggin is a professor at the University of Queensland’s School of Economics