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Workers are making it clear that they’re no longer willing to accept a job that puts their health, safety and wellbeing at risk.
Alison Omens is Chief Strategy Officer at JUST Capital.
With nearly half of the United States’ population fully vaccinated against the coronavirus, businesses across the country are eager to return to pre-pandemic operations. But, especially for retail, hospitality, and other predominantly low-wage industries, that hasn’t been easy.
The problem? They can’t find the workers to staff their restaurants, bars, hotels, and stores.
Americans are quitting their jobs in droves – including low-wage and essential workers. Those who lost jobs during the pandemic aren’t racing to return to work. Companies are offering hiring bonuses and temporary wage increases in the hope of luring applicants, with neither method proving effective. And this isn’t only an American trend.
The economy is experiencing what executives have deemed a “labor shortage”. But the reality is something more profound, with potential long-lasting consequences. This is a good jobs shortage.
Workers are making it clear that they’re no longer willing to accept a job that puts their health and safety at risk, leaves them unable to take care of themselves and their families, and doesn’t calculate their overall needs. For the first time in decades, the job market is leaning in favor of workers over employers.
A good job can be defined as one that meets people’s basic needs, and offers the conditions for engagement and motivation. That includes paying a fair, livable wage, providing safe and healthy working conditions, scheduling shifts regularly, and creating opportunities for career advancement, among other factors.
The jobs that employers in low-wage industries are struggling to fill, and workers aren’t willing to take, are those lacking these crucial components.
JUST Capital and The Harris Poll recently conducted a survey based on bringing back talent into the workforce. Americans surveyed said these companies should raise starting wages and provide comprehensive benefits. They want to see companies make these changes permanent. They also said that they want to see companies enact childcare support policies, flexible work schedules, and health and safety measures for frontline workers.
This churn of the labor market is deeply connected to another debate underway – how companies and their stakeholders, from investors to workers, measure good job policies and their impact on business. Because without transparency on policies, and clear expectations on what businesses should be measuring and disclosing, it’s impossible to know how companies are performing relative to their peers on issues like retention, attraction, and absenteeism.
The market can’t perform well if it’s operating with this imperfect information that doesn’t show the risks and opportunities associated with the current economic situation. Both the private and public sectors are starting to recognize this, and we’ve seen encouraging signs toward greater transparency.
Momentum behind stakeholder capitalism, fueled by the impacts of the pandemic and ongoing global reckoning with systemic racism, has swelled over the last year – and mandated environmental, social, and governance (ESG) reporting is not a faraway thought.
Under the Biden administration, the Securities and Exchange Commission (SEC) has made ESG a top priority, and recently turned to the public for input on how to approach climate-related disclosures. The UK and Europe have also made similar moves in recent years on issues like gender and advancing human capital standards overall.
Companies that invest in their workforce and make this information available are often those that will succeed in the long term, according to research. And they can start by making a commitment to measure their workers’ needs.
Chipotle, Chobani, Even, Prudential Financial, and Verizon recently took a first step by joining The Worker Financial Wellness Initiative, and pledging to assess the financial well-being of their employees. They join PayPal, which has reaped the substantial business benefits of investing in workers in traditionally low-wage roles.
While it’s too soon to tell if the tilt in bargaining power toward workers will be a long-lasting one, employers would do well to think of it as one. The post-pandemic American economy can be a good jobs economy. Workers won’t settle for less, and neither should businesses.
This opinion piece is part of the Thomson Reuters Foundation’s work, Amplifying the "S" in ESG, which aims to promote wide adoption of social criteria in investment strategies.
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