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In a ‘workers economy,’ who really holds the cards?


With the country’s labor force down by more than four million people and resignations at a high, employers are desperate to make hires.

By Emma Goldberg


Zella Roberts was one of the highest-performing waitresses at the Sonic drive-in in Asheville, North Carolina, her manager told her, but there were days during the pandemic when Roberts questioned whether she could continue her job. The customers were unruly and often unmasked; the base pay was $5 an hour. Then one afternoon in November 2020, a man coughed in her face as she served him a hot dog. Roberts went home and cried.


Some of her colleagues were quitting — often walking out midshift — and Roberts, 22, could tell that the managers were “sweating” trying to figure out how to staff the restaurant. So instead of leaving, she wrote a petition. She asked that Sonic make it easier for customers to tip their carhops. Weeks later, her manager pulled her aside to say the Sonic app was being changed to allow credit card tips.


Back at home, Roberts and her friends celebrated by blasting an old union song, Pete Seeger’s “Which Side Are You On?”


“Workers are fed up, and restaurants are desperate,” Roberts said. “We’re scarce, we have higher standards, and that gives us more power than we’ve had before.”


With the country’s labor force down by more than 4 million people and resignations at a high, employers are desperate to make hires. The share of job postings on ZipRecruiter offering retirement plans is up 30% since before the pandemic; posts advertising flexible scheduling grew threefold; the share offering signing bonuses went from 2% to 12%.


Still, the flood of people leaving their positions has kept rising. In August, 1 in 14 hospitality workers quit their jobs, according to the Bureau of Labor Statistics, a quit rate more than 50% higher than before the pandemic.


Today, job seekers find nearly 50% more openings than they had pre-COVID, and many can expand their search beyond their hometowns because of newly flexible workplace arrangements across industries.


Flush with options and frustrated after laboring through lockdowns, workers are feeling a sense of possibility. Some are resigning. Some are waiting for a prime gig. Others are flexing their muscles — requesting raises or remote work options — while still clocking in. Employers are noting the jump in demands and in some cases catering to it, during a shift in power they realize may be long-lasting.


“People don’t realize the scale of what has changed,” said Julia Pollak, chief economist at ZipRecruiter. “If you take even one chair away in musical chairs, it changes the entire dynamic of the game. That’s what we’re seeing now, where the 50% increase in job openings has given job seekers dramatically more leverage.”


Businesses are scrambling to offer new benefits, including bonuses and family insurance plans; some hospitality companies are promising managers “stay bonuses” as high as $75,000 to prevent poaching. Workers, meanwhile, are taking the chance to make bolder requests of their bosses.


Adam Ryan, 33, who works at a Target in Christiansburg, Virginia, has been trying to organize his co-workers, who are not unionized, to ask for better pay and conditions since he started at the store in 2017. Before the pandemic, Ryan used to see a look of fear creep over his co-workers’ faces when he asked them to sign his petitions.


But in recent weeks, Ryan’s colleagues have been eager to hear his ideas. When he approaches them — at the trash compactor, in the clothing aisles, as they are restocking shelves — many agree to join his campaign requesting $2 hourly in hazard pay for working during the pandemic.


“Folks feel that they’ve been through a lot and have less to lose,” Ryan said. “With the labor shortage, people feel more valuable and harder to replace.”


Last month, Target announced that it would pay employees an extra $2 hourly during peak days of the holiday season, which Ryan saw partly as a response to the pressure employees like him put on the company. He calculated that the bonus could earn his co-workers at most $180 extra for the season, so it has invigorated him to continue making larger demands.


Target is part of a swell of companies facing employees who want higher pay, better benefits or more flexible working arrangements. There have been strikes against 178 employers this year as of mid-October, according to a Cornell University School of Industrial and Labor Relations tracker.


Even in what economists have christened a “workers economy,” many tech and service workers are at-will employees and can be fired with little warning. And when workers have managed to sustain wins, the improvement they see in working conditions or earnings is often marginal. Weekly wages for restaurant workers, for example, have increased as the hospitality industry struggles to find staffing. But that has brought annual earnings for nonsupervisory workers up to roughly just $22,000 as of September.


“There’s a lot of momentum right now, but there are some very serious obstacles toward workers actually acquiring sustained levels of power,” said Heidi Shierholz, president of the Economic Policy Institute, noting that less than 11% of American workers are represented by unions.


“Employers are trying on for size this idea that the pandemic has been hard on everyone,” Shierholz added. “It’s a window for them to claim they don’t have power. But we absolutely know that employers hold the cards.”


But if some of the power that workers feel right now is limited or even illusory, the debates over remote work arrangements have given them some concrete victories.


At 3M, a multinational manufacturing company based in Minnesota, internal polling showed that 87% of employees valued flexibility in where they could work; in August, while the delta variant was spreading, the company announced a new approach to remote work that lets employees set their own terms on when to come to the office, if at all. At PWC, more than 40,000 employees learned last month that they could work anywhere they want within the United States.


Even at companies that put a high value on in-person work, the realities of recruiting in this market have changed the calculus.


“To some degree we’re catering to the expectations and wishes of law students and our younger lawyers,” said Brad Karp, chair of the law firm Paul, Weiss, which is requiring most employees to be in the office at least three days a week starting this month but is far more flexible on remote work than pre-pandemic.


The past year has emboldened laborers to tell their bosses where, when and how they want to work, according to Karp.


“At some organizations that might have been more stodgy or hierarchical, you’re seeing the March 2020 demarcation as a watershed moment,” he said. “The ability of the workforce to speak their minds became actualized.”


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