For anyone whose key areas of interest lie in labor, enterprises and firms, it was particularly hard to resist seeing the phrase ‘The Great Resignation’ across all media over the past two years. The anecdotal valence of this narrative is not lost to us, the pandemic was a moment of great upheaval, everyone knew someone who had thrown up their hands at a job they were at for a long time. On a more observable register, you realized the gas station attendant you were used to seeing every morning probably got fed up with the rut of seeing you.
Narratives also become compelling when you start seeing big numbers attached to general sentiment, “4 million Americans quit their jobs” , “11.6 million open jobs”—you get the gist. Nobody is contesting the numbers, seen in isolation they can seem pretty alarming. However, as Joseph Fuller and William Kerr suggest, these numbers must be viewed from the prism of a larger, unfolding story, so that we can all see that “what we are living through is not just short-term turbulence provoked by the pandemic but rather the continuation of a long-term trend.” Ever since 2009, quit rates have remained pretty consistent, averaging a 0.10% increase every year. While the pandemic did see unprecedented quit rates, this was a pretty easily explained phenomenon, “..the resignation rate slowed as workers held on to their jobs in greater numbers. That pause was short-lived. In 2021, as stimulus checks were sent out and some of the uncertainty abated, a record number of workers quit their jobs, creating the so-called Great Resignation.”
Beyond Smokescreens
We must pause to reflect on the most critical feature that really brings such narratives home—their underlying causes. Most working people across the world can identify and relate to the urge to quit one’s job. Poor working conditions, poor pay, bleak outlooks for career growth, and a lack of satisfaction in one’s daily work strike one instantly as some of the many reasons why a large part of the working world wants to jump ship.
Anna Stansbury and Lawrence H. Summer’s work also points us towards the interesting ‘Declining Worker Power Hypothesis’, which states that labor’s diminished power serves to explain long-standing trends in the U.S. economy including a falling labor share of income, rising income inequality and slow wage growth — while corporate stock market valuations and profitability skyrocket. At the height of the organized labor movement in the US, one-third of the private sector was unionized, while only 6% of the private sector workforce are represented by a union now.
A New Outlook for firms
Despite labor’s negligible seat at the table, firms have upped the ante when it comes to curbing the influence of worker power. Amazon spent more than $4.3 million on hiring anti-union consultants alone, in an attempt to prevent the eventual formation of the Amazon Labor Union (ALU), and this Mother Jones report suggests that companies spend around $340 million a year on anti-union consultants. It is time that firms decided to redirect such vast resources to the upliftment and wellbeing of their own workers. Our research has shown that providing the tools for workers to air their grievances could even result in reduced quit rates by 20%. At a time when warehouse workers have to ration out their toilet breaks, no amount of investment in anti-union consultants is going to prevent them from joining a union. Firms must take cognizance of the changing times and strive to provide their workers with better reasons to not quit their jobs—let us all live to see better narratives.
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