Three Employee Problems and One Big Employer Concern – Different but Similar

With new technology, follow-on effects from the pandemic, strong employment, and a new generation – Z – becoming established in jobs, it is no surprise that concerns around workers and their managements are evolving.  Except for those centering around putting in less effort, having multiple jobs, and the pendulum of office work to home work and back, what issues have reached the press?

For one, “Employees are demanding workplace resets” (Brock Dumas, Fox Business, August 31^st).  The piece covered a report from Edelman, which once a year issues the Edelman Trust Barometer.  The statement revealed that, of 7,000 employee recipients, 72% “said it is more important than ever that employers rethink what work means to employees,” with “career advancement,” “personal empowerment,” and “societal impact” each named by 71% to 83% of respondents.  While the first one is old, the second has not been stated as often as felt and the third has recently risen dramatically.  Sixty-one percent said they were “more likely to work for an organization where the CEO speaks publicly about the controversial issues they care about.”  In all, though, “workers across the board have expressed far greater trust in their employers than any other institution the survey asks about, which are business, non-government organizations, the media and the government.”

Yet there are other problems.  Per “Most people have an unhealthy relationship with work, study finds: ‘Huge opportunity’” (Erica Lamberg, Fox Business, September 21^st).  The surveyor this time was HP Inc, with “the first HP Work Relationship Index, a comprehensive study that explores employees’ relations with work around the globe.”  Only 27% of “knowledge workers” claimed a “healthy relationship with work.”  Lamberg recommended employees talk about it with their bosses, with important principles to “walk before you run” or expect less at the start, “it’s all about presentation” or framing intentions as “here is how you can get the very best quality of work out of me,” and “know your worth” by documenting accomplishments. 

A long-standing but timely one returns in “Almost half of Americans see automation replacing their jobs” (Rich Miller, Benefit News, August 21^st).  American Staffing Association found that in a survey, a share which almost doubled since a similar 2017 effort, and that “some three-quarters of those polled expect increased use of automation and artificial intelligence to lead to higher joblessness.”  With 2024 thus far a down year for AI, it would be worthwhile to see what a similar study would tell us now.

On the employers’ side, one concern affecting all of us has evolved.  On December 11^th, we saw that “Corporate America Is Testing the Limits of Its Pricing Power” (Jason Karaian, Jeanna Smialek, and Joe Rennison, The New York Times, December 11^th).  Talking first about 2022 and then about late 2023, “margins eased somewhat last year, but have recently recovered to levels that would have set records before the pandemic,” and “average margins in nearly every sector in the S&P 500 are running near or above 10-year highs, according to Goldman Sachs.”  A chart titled “Quarterly net profit margin of S&P 500 companies,” covering 2010 to 2023, showed, except for an early-pandemic dip, a choppy rise from just over 8% to 12%.  Further article findings were “there’s a focus on margins over market share” and “that’s a shift from post-2009 practice,” “companies learned they can charge more than they thought… but price sensitivity may return,” and “the ability to raise prices – or keep them high – may not last.”

In the four months since, inflation concerns have become more vocal, so overall demand may yet return to being more elastic.  Yet some ways of raising profit are getting bad press, at least from Christopher Beam, whose “Welcome to Pricing Hell” came out in Atlantic in April.  The author’s concern was about “the ubiquitous rise of add-on fees and personalized pricing,” which “has turned buying stuff into a game you can’t win.”  He started discussing how Wendy’s’ plan for “dynamic pricing” faced strong negative reactions, as have new fees, subscription plans, unbundled features, and the use of personal data to determine product cost.  Variable rates, common before the 1800s invention of the price tag, may have started with airplane tickets, spread to “airline-adjacent industries like hotels and cruise lines,” and proliferated from there.  In the 2010s, more and more industries added fees often unrevealed until just before payment time.  At the origin point, extra charges have reached the point where “the airlines raked in $33 billion from baggage fees, and even more from other ancillary fees like seat selection, meals, and in-flight Wi-Fi,” such tariffs becoming “a major driver of airline profits.”  Personal data often reaches retailers through apps, which can access purchase history, financial information, and much more, which “can be fed into machine-learning algorithms to generate a portrait of you and your willingness to pay.” 

Most of my fellow economists think personal pricing is fine.  They do not, however, like belatedly disclosed fees.  As the last article revealed, “even the CATO Institute, the libertarian think tank that never saw a regulation it liked, acknowledges that consumers “shouldn’t be charged for products without their consent, and businesses should disclose mandatory fees before purchases are made.””  If that means sooner than the Place Order page, that’s good enough for me.  There will be much more personal pricing, though – it is up to us to determine how to facilitate or impede it, as we wish.  In work situations as well as with what we buy, there are countermeasures.  Even in these times, we still have choices.