Contributor, Korn Ferry Institute
This Week in Leadership (Sept 20 - Sept 26)
Why job switchers aren't getting that much more money. Plus, leadership lessons from Angela Merkel and her very long tenure.
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It’s only a few short months into a new decade, and already some leaders are becoming alarmed that a recent trend may last for the rest of it. The problem would have been unheard of at the start of the century—but it has arrived unexpectedly early.
The issue is jobs—that is, jobs that are engaging. Most barometers are showing that while finding a job hasn’t been too difficult in recent years, getting a good one has become a true challenge for millions across the globe. Some critics call the work “low quality”; others say they are “lifeless” or “garbage” roles. But by any name, workforces that are disengaged can threaten the success of any company.
Certainly, the fear of boring jobs has been looming ever since the dawn of artificial intelligence and machine learning. But that was supposed to be a problem years away, and many thought the introduction of robots would only introduce more intriguing positions for some humans. What’s more, all the economic news in recent years has focused on the steady creation of jobs, presumably ones with career development opportunities.
Indeed, through at least the start of the year, the US economy has been adding close to 200,000 new jobs a month since 2015. The question is, what kind of jobs are they? Not good ones, according to a report by Cornell University and the University of Missouri, Kansas City. The study tracked job creation—excluding management roles—and created an index that categorizes a “low quality” job as any with pay falling below the mean for that work. The result: six in 10 new jobs, 63 percent to be exact, are low-quality roles.
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“We are not producing jobs in the right industries fast enough,” explains Jeff Ferry, one of the researchers and the chief economist at the Coalition for a Prosperous America. Instead, most of the new job creation is in low-paying, labor-intensive, high-stress sectors like leisure and hospitality, private education, and healthcare services. In most of these cases, prospects for career advancement and the opportunity to add new skills are low.
A similar dynamic is playing out in Europe, where companies have fallen big time for temp work, which now accounts for about one in seven (14.2 percent) of all jobs there. A key concern about these jobs—and those of low quality in the United States—is shorter hours. Low-quality roles are only about 30 hours a week, eight hours a week less than higher-quality roles.
But that presents an opening to change the tide, experts say. “Employers may be able to get more engagement bang for their buck from raising the number of hours worked,” says Robert Hockett, another of the index researchers and a law professor at Cornell University. Hockett says that increasing the hours worked, coupled with a wage increase and the opportunity to obtain new skills, could lead to the increased productivity that firms need.
To be sure, many large corporations are increasing wages to their lowest-paid workers in a bid to better recruit and retain talent. Bank of America, for instance, is raising its minimum wage to $20 per hour nationwide this year. “When you see large employers taking those positions, it will have outward pressure on everyone else,” says Scott Macfarlane, a Korn Ferry senior partner and global account lead for the firm’s Financial Services practice.
Experts say companies also can make low-quality jobs feel like high-quality ones even if the pay is modest. Effective job and organizational design, clarity in purpose, and an energizing work climate will lead to more engaged and productive employees, says Tom McMullen, a Korn Ferry senior client partner and a leader in the firm’s Global Rewards and Benefits expertise group.
The irony, of course, is that AI and machine learning were supposed to pave the way for more high-quality jobs, not increase the supply of low-quality ones. That’s why Hockett believes organizations and governments need to work together to reorient education and economic policy to train and upskill people. “Not all labor moves up the ladder to skilled labor,” says Hockett. “In the absence of readily attainable higher education, we might be heading toward a future of either a low-quality job or no job at all for some people.”