Money is not everything in the Great Revaluation
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A meeting with a group of executives from manufacturing companies can’t be guaranteed to surprise, but I recently found myself in a gathering that did just that.
The managers came from a mix of companies. Some made cars, one made fertilizer, others produced steel, glass or perfume.
Everyone in attendance was troubled by the Covid-related shortages that have hit the supply of everything from computer chips to Ikea mattresses. The lack of workers in what has been called the Great Resignation was also vexatious.
More striking, however, is what has been said about the potential shortage of employees, especially younger ones, once the pandemic is over.
âWe need to revolutionize the way we make manufacturing roles attractive to the younger generations,â said an executive from a global company with thousands of employees. âIf we don’t do that, we won’t have the manpower to make our products. “
Most of the employees at this company didn’t have the luxury of thinking about whether or not they could work from home. They did shift work on a production line in a hot factory. Isolation was common, as was staff turnover at a time when, as the executive said, âthere are so many other optionsâ.
Factory owners faced a staff shortage long before Covid hit. Studies from 2018 predicted that US manufacturers risked a shortage of 2.4 million workers by 2030, in large part because of the industry’s ânegative perceptionâ problem.
But at that meeting, I remembered the advice Joe Biden offered recently when asked about the labor shortages that have driven American businesses to struggle to find workers: “Pay them more. . “
Would it help, I asked the manufacturing executives, if they just paid young people more? Not as much as you might think, I was told.
As one person put it, the pay is obviously relevant, but it is “absolutely not the kind of incentive that it has been for older generations for many decades and we cannot trust it” .
The manager said this was already the case for millennial workers, the oldest of whom turned 40 this year, but was even more apparent among so-called Gen Z employees born since 1997.
The idea that pay isn’t everything is not new. The influential American psychologist, Frederick Herzberg, showed in the 1960s that pay rates are a “hygiene factor” that does not promote job satisfaction per se, but prevents dissatisfaction – just as good hygiene does. not cause good health, but will cause disease if insufficient. .
Yet if attitudes towards compensation change, this has profound implications for employers, and not just for factory owners.
It would also ring with what we could call the Great Re-evaluation of professional life that the pandemic seems to have stimulated for some employees.
A staggering number of more than 15 million Americans have quit their jobs since April, and 40 percent of employees in the United States, Australia, the United Kingdom, Canada and Singapore say they are at least ” rather likely âto resign within the next six months, said McKinsey report showed last month.
Worrying for employers, nearly two-thirds of those considering leaving say they are ready to leave without a new job in hand.
Tellingly, salary was not the main reason given for leaving the ship. On the contrary, the three main factors mentioned by the people were the feeling of being undervalued by their organization, or by the managers, or of not having the feeling of belonging.
So what’s the answer? Several executives cited more autonomy, more recognition, more flexible hours, better vacations and anything that generally makes working life more enjoyable.
I suspect they’re right, especially after speaking last week to a 34-year-old Briton named Sophie Munn, a digital marketer at consumer goods group Unilever.
Four years ago, she was about to marry a school teacher who had two months off in the summer, when she decided to take advantage of Unilever’s unpaid leave plan.
It allows UK staff to take up to six months and return to their old or equivalent post, without leaving their pension scheme or losing other benefits.
As a result, Munn’s planned three-week honeymoon turned into two months of travel, from Bali to Borneo and California, making her feel grateful and have a firm view of the importance of remuneration. âThe salary is important,â she says. “But I want to live my life.”