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Wednesday 13 January 2010
The Disposable Worker

You know American workers are in bad shape when a low-paying, no-benefits job is considered a sweet deal. Their situation isn’t likely to improve soon; some economists predict it will be years, not months, before employees regain any semblance of bargaining power. That’s because this recession’s unusual ferocity has accelerated trends—including offshoring, automation, the decline of labor unions’ influence, new management techniques, and regulatory changes—that already had been eroding workers’ economic standing.

The forecast for the next five to 10 years: more of the same, with paltry pay gains, worsening working conditions, and little job security. Right on up to the C-suite, more jobs will be freelance and temporary, and even seemingly permanent positions will be at greater risk. “When I hear people talk about temp vs. permanent jobs, I laugh,” says Barry Asin, chief analyst at the Los Altos (Calif.) labor-analysis firm Staffing Industry Analysts. “The idea that any job is permanent has been well proven not to be true.” As Kelly Services (KELYA) CEO Carl Camden puts it: “We’re all temps now.”

Peter Cappelli, director of the Center for Human Resources at the University of Pennsylvania’s Wharton School, says the brutal recession has prompted more companies to create just-in-time labor forces that can be turned on and off like a spigot. “Employers are trying to get rid of all fixed costs,” Cappelli says. “First they did it with employment benefits. Now they’re doing it with the jobs themselves. Everything is variable.” That means companies hold all the power, and “all the risks are pushed on to employees.”

The era of the disposable worker has big implications both for employees and employers. For workers, research shows that chronic unemployment and underemployment cause lasting damage: Older people who lose jobs are often forced into premature retirement, while the careers of younger people are stunted by their early detachment from the working world. Even 15 years out of school, people who graduated from college in a recession earn 2.5% less than if they had graduated in more prosperous times, research has shown.

Diminishing job security is also widening the gap between the highest- and lowest-paid workers. At the top, people with sought-after skills can earn more by jumping from assignment to assignment than they can by sticking with one company. But for the least educated, who have no special skills to sell, the new deal for labor offers nothing but downside.

Employers prize flexibility, of course. But if they aren’t careful they can wind up with an alienated, dispirited workforce. A Conference Board survey released on Jan. 5 found that only 45% of workers surveyed were satisfied with their jobs, the lowest in 22 years of polling. Poor morale can devastate performance. After making deep staff cuts following the subprime implosion, UBS (UBS), Credit Suisse (CS), and American Express (AXP) hired Harvard psychology lecturer Shawn Achor to train their remaining employees in positive thinking. Says Achor: “All the employees had just stopped working.”

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    You know American workers are in bad shape when a low-paying, no-benefits job is considered a sweet deal. Their...
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    azspot: “You know American workers are in bad shape when a low-paying, no-benefits job is considered a sweet deal. Their...
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    Here is an example of something that makes me seethe outside as well as inside. I’ve already linked to this in another...
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