History and post-pandemic work

The times they are a changin'...again

This week, I want to explore more about what we’re seeing in a post-pandemic world, as it relates to work.

But, first, I want to make a quick detour.

I attended two particularly engaging and interesting meetings this week: The Circles of Hope dinner, and the Community Conversation about substance misuse.

On the Community Conversation - you haven’t really experienced a gut punch until you hear a mother share her story about her child’s struggle with addiction - and the ensuing isolation and ostracization that comes with it. This was a powerful event, with poignant panelists talking about an important issue that has affected our city, state, and nation, for years. Unfortunately, there weren’t nearly enough people there. And to be painfully truthful - the room was largely filled with the people who already understand this message and are doing the work. I hope we’ll see more, and broader, engagement at future conversations - because I hear an awful lot of people say “we really should do something about that drug problem.” People are trying. They just need more help. If you’re interested, there are two more events scheduled at The Fox Theatre on July 16 and August 13. The event is here on Facebook.

Circles of Hope is a spectacular group that works to help people navigate their way out of poverty. This is done with a combination of training, education, and mentorship. It is a proven method that builds support systems that last a lifetime. I was invited to speak to the local chapter about engagement, and how they can elevate their collective voices on policy issues. Hearing the stories and struggles people face as they try to undo the effects of generational poverty is as heartbreaking as it is inspiring. If you haven’t read it, take a look at this story about the Cliff Effect when people start to move from poverty to middle class. It’s yet another example of how people who are trying to do the best they can get kicked in the teeth for their efforts.

Together, these two events remind me how dramatically different some people’s experiences are from our own. Some are born into situations we could never imagine, and it’s unfair for us to expect that they’ll emerge out of childhood with the same tools for adulthood that many of us have. We all get to choose how we’ll respond and engage with this. But it’s clear to me that all the dismissiveness, condemnation, and judgement won’t make anyone’s situation better. I don’t know very many people who have been shamed into “doing better.” The evidence shows quite the opposite - and a collective finger wagging from society typically makes problems worse.

Now, back to that thing about work.

I’ve been reading and listening this week to some good analysis about what’s happening in the labor market. It seems that despite 20-something state’s yanking away enhanced federal unemployment benefits, there’s still a nationwide workforce shortage and will be for the foreseeable future.

It’s almost as if that was never the problem at all.

It turns out what we’re experiencing now is historically pretty common on the heels of a “non-financial crisis.” Translation: Those times when the economy is turned upside down for a reason other than good Ole’ Fashioned, garden variety greed. Think wars and pandemics.

From a great article in The Economist:

History also offers a guide to what people do once life gets back to normal. Spending rises, prompting employment to recover, but there is not much evidence of excess…The second big lesson from post-pandemic booms relates to the “supply side” of the economy—how and where goods and services are produced. Though, in aggregate, people appear to be less keen on frivolity following a pandemic, some may be more willing to try new ways of making money. Historians believe the Black Death made Europeans more adventurous. Piling on to a ship and setting sail for new lands seemed less risky when so many people were dying at home. “Apollo’s Arrow”, a recent book by Nicholas Christakis of Yale University, shows that the Spanish flu pandemic gave way to “increased expressions of risk-taking”. Indeed a study for America’s National Bureau of Economic Research, published in 1948, found that the number of startups boomed from 1919. Today new business formation is once again surging across the rich world, as entrepreneurs seek to fill gaps in the market…

A third and fourth element, according to the article is quicker adaptation toward automation, and a stronger bargaining position for workers, who have re-evaluated their worth amidst the crisis.

This Wall Street Journal article carried a poignant headline: “Forget going back to the office - people are just quitting instead.”

More U.S. workers are quitting their jobs than at any time in at least two decades, signaling optimism among many professionals while also adding to the struggle companies face trying to keep up with the economic recovery.

The wave of resignations marks a sharp turn from the darkest days of the pandemic, when workers craved job security while weathering a national health and economic crisis. In April, the share of U.S. workers leaving jobs was 2.7%, according to the Labor Department, a jump from 1.6% a year earlier to the highest level since at least 2000.

The issue is further examined in the podcast Pitchfork Economics. Callum Williams, a writer for The Economist, visits with the hosts about what we’re seeing in the labor market - namely how what we’re seeing now is a historical norm. It turns out after something like a war or a pandemic a lot us re-evaluate our life paths, and make adjustments that better suit our goals. Also, this podcast is always worth listening to if you’re at all interested in hearing a perspective on economics that deviates from the nonsense we’ve been spoon-fed for the last 40 years.

Couple all of that with evidence that many Americans experienced financial insecurity and reduced opportunity in recent years - made worse by the pandemic - and a shift in worker attitudes shouldn’t be terribly surprising.

This from McKinsey & Company’s survey on American Economic Opportunity:

What we learned was sobering. Among the findings: Americans report that their financial situations have deteriorated over the past year, and at the time of our survey only half of all respondents reported being able to cover their living expenses for more than two months in the event of job loss. Our survey results also indicated that the pandemic has harmed the economic well-being of many groups, exacerbating inequalities that existed before the crisis. Americans reported facing numerous barriers to economic opportunity and inclusion—among them, inadequate access to health insurance and physical and mental healthcare, as well as to affordable childcare. Moreover, many respondents said that they feel their very identity limits their access to jobs and to fair recognition and reward for their work.

If we know that people are less willing to be a cog in a shareholder earning machine, and we know that people are more willing to quit their jobs, and more willing to start up their own businesses in a post pandemic world, and if we know this is going to trend for a while, based on historical norms - are we positioned to capture the most economic growth from the next several years? Will we continue to allow government to serve as a quasi-extension of corporate America instead of retooling to empower people to chart their own course in life?

And I’d be remiss if I didn’t once again scream into the Kansas void that things like Medicaid Expansion and Child Care assistance programs are economic development tools. Both are powerful aids that support workforce participation by turning a low-wage job into one that can better support a family. And they serve as foundational supports for entrepreneurs and small businesses that need employees, but can’t afford the high cost of group health insurance.

It seems to me that given what we see in the numbers, and what we know from history, we should be positioning to better support start up and small businesses as they set out on a path for growth. In fact I’d argue that we should probably be moving some of those long-standing corporate tax credits and exemptions to programs that encourage entrepreneurship and innovation - and that leverage public/private initiatives that increase odds of success for start ups.