Burning the Compact

The old paradigm in employment benefits, circa 1999: What
will it take to get you to work for us? A signing bonus? Stock options so you
can retire at 30? A concierge to take care of all those chores you don’t want
to be bothered with? A funky workplace with exposed brick walls and old-growth
ceiling beams? Foosball tables and squirt-gun fights? Sure, bring your dog to
work. Better yet, don’t even bother showing up. Just work from home at whatever
hour you want.

The current reality: Congratulations. You made it to the
end of the day without being laid off. Your reward: You get to come back
tomorrow and try your luck again.

The favorite American pastime is not baseball or football or
shopping or watching TV—it’s making economic comparisons to everyone else. How
big a house do others live in? How big a mortgage did they take out? What kind
of car are they driving? How new? The result is envy, smugness, the motivation
to work harder or an appreciation for one’s situation, depending on which
attitude provides the most comfort or the greatest entertainment.

Few areas of economic endeavor provide such a wealth of
material for comparisons as wages and benefits, and few periods of economic
excess generated such copious quantities of too-ridiculous-to-be-exaggerated
tales as the dot-com boom.

If ever there was a social prohibition on discussing the
contents of one’s pay envelope, it was gone by the time the dot-coms threw
fistfuls of cash, stock options and workplace perks at employees. Not that many
workers got to indulge in the binge; many of them were left outside in the
cold, noses pressed against the glass, staring in at the party they weren’t
invited to.

Eventually, the party ended for the dot-commers, but the
sport of gazing enviously on others’ compensation never did. The periodic
strikes at Boeing could be counted on to produce considerable grumbling from
outsiders over the wages and benefits unionized workers received. More
recently, the fight over pensions for government workers, including those in
Washington state, is cause for unhappiness among those with little prospect for
a retirement benefit of any sort.

During the recession, the most valued job benefit was having
a job at all, never mind what it paid or whether any perks came with it.

Will that outlook change when the economy improves and
companies resume hiring? Prospects for a seller’s market aren’t promising.
Businesses scarred by the downturn are likely to be tight with the number of
jobs they create and what they offer to employment candidates, who in turn, scarred
by unemployment, are likely to dampen their own expectations.

Furthermore, even before the recession hit, the social
contract—companies would provide steady, decently compensated employment to
their workers, who in turn would offer loyalty and energetic work for the
decades they spent—had not just been terminated, but burned.

And colliding with those factors is a huge demographic
trend—the baby boomer generation slowly exiting the workforce. Already,
employers in certain industries such as manufacturing are looking at the huge
cohort of skilled, experienced and knowledgeable workers headed for the doors,
and fretting about where their replacements will be found. Meanwhile, the lack
of job security, which worked to employers’ advantage, could become a bargaining
chip for employees. Want me to stick around? What’s it worth to you?

That situation’s going to make for an interesting workplace
dynamic in the coming decade. The quaint notion of loyalty on either side
having been expunged, the workplace understanding of employer-employee
relations will come down much more openly to the dollars and work exchanged
between the two. That bond was at the core of those relations all along, but
now the polite façade is gone. Given the bruising experience of the recession
for both sides and the new reality in which employers and employees will deal
with one another, that façade will not be restored by a few foosball tables
hauled out of storage.

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