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Today\u2019s new deal at work reprises work schemes of the late 1800\u2019s, plus a few meaningless perks.<\/strong><\/p>\n<\/p>\n
Dan Lyons\u2019\u00a0account<\/a>\u00a0of his time at the software company HubSpot describes a workplace in which employees are disposable, \u201ctreated as if they are widgets to be used up and discarded.\u201d And HubSpot is scarcely unique: The\u00a0description<\/a>\u00a0of Amazon\u2019s work environment is just one of many similar cases. An increasing number of companies offer snacks, foosball, and futuristic jargon to keep employees\u2019 minds off their long hours and omnipresent economic insecurity.<\/p>\n <\/p>\n Whether that works, and for how long, is an open question.<\/p>\n <\/p>\n Of course, in the new economy ever fewer companies hire people like Lyons as employees in the first place. Many workplaces prefer to use independent contractors for much of the companies\u2019 work. A\u00a0recent working paper<\/a>\u00a0by labor economists Lawrence Katz and Alan Krueger concluded that the proportion of the U.S. labor force in alternative work arrangements\u2014working for temporary help agencies or as independent contractors, for example\u2014expanded by some 50% in the decade from 2005 to 2015. Moreover, they wrote, \u201call of the net employment growth in the U.S. economy from 2005 to 2015 appears to have occurred in alternative work arrangements.\u201d<\/p>\n <\/p>\n Three facts about the new deal at work and the new work arrangements are important. First, these new work arrangements are actually old, much like how work was organized before the modern employment relationship originated. Second, these new\/old work arrangements represent a natural progression of company policies, begun decades ago, that tell people that companies owed them nothing except promised pay and to make them more employable. And third, by leaving people to navigate the contemporary labor market essentially alone, the employment arrangements disrupt an old and important reason for working\u2014the opportunity to be part of a group.<\/p>\n <\/p>\n The New Work Arrangements are Actually Old<\/strong><\/p>\n <\/p>\n As numerous labor historians and sociologists have documented, before there were large companies employing people and using elaborate human resource policies to govern recruitment, compensation, benefits, and training, work was mostly performed by small entrepreneurs using family labor (as on farms) or by contract labor paid on a piece-work basis.<\/p>\n The modern employment relationship emerged primarily because of enlightened employer self-interest. As UCLA economist Sanford Jacoby documented in his book Employing Bureaucracy,\u00a0rule-based control over labor emerged as a response to the inefficiencies caused by a capricious employment relationship that left employees alienated and turnover extremely high. Jacoby\u2019s\u00a0Modern Manors\u00a0detailed how generous benefits such as paid vacations and pensions arose under a system called \u201cwelfare capitalism\u201d as a way to forestall unionization and government regulation. As an example of this, Henry Ford\u2019sfamous $5 a day wage<\/a>\u00a0and a concomitant reduction in daily work hours from 9 to 8 arose because Ford saw that he needed to pay more to retain workers and ensure they would show up. His famous automobile assembly line couldn\u2019t run with people missing.<\/p>\n <\/p>\n Although it is coupled with more computer surveillance and fancy scheduling platforms to pair people with work, today\u2019s use of independent contractors paid on a piece-rate system represents a return to the work arrangements of 140 years ago, not some new managerial innovation.<\/p>\n <\/p>\n \u00a0Employees Beware<\/strong><\/p>\n <\/p>\n Second, the need for employees to fend for themselves is also a hoary idea. The number of employers offering some form of employment security\u2014a no-layoff policy\u2014has declined drastically. What once was a practice cited by many companies on the Great Place to Work list now exists almost nowhere.<\/p>\n Decades ago, employers in Silicon Valley and elsewhere began telling people that employees were responsible for their own careers. A company could at best deliver on promised pay and benefits and hopefully provide workers with jobs that would build their skills and make them more employable (possibly elsewhere).<\/p>\n Almost 30 years ago, Northwestern professor Paul Hirsch wrote\u00a0Pack Your Own Parachute\u00a0to provide advice to workers in an era of mergers, downsizing, and outsourcing. Fifteen years later, Dan Pink\u2019s\u00a0Free Agent Nation\u00a0achieved best-seller status with its combination of practical suggestions on how to navigate an increasingly market-based labor market along with inspiring stories of free agents who loved their new autonomy.<\/p>\n <\/p>\n The idea of reciprocity inside companies\u2014repaying the loyalty of employees to their employer with company loyalty to its workers\u2014is mostly gone. Carnegie-Mellon professor Denise Rousseau\u00a0co-authored a paper<\/a>\u00a0reporting that within two years of joining their employer, more than half of the people surveyed reported that the implicit and explicit psychological contracts with their employer had been violated.\u00a0Research<\/a>\u00a0by Virginia business school professor Peter Belmi and I found that when you told people they were making decisions about whether or not to reciprocate a favor, their motivation to do so depended on whether they thought they were in an organizational or interpersonal context. People put in an organizational mind-set were much less likely to reciprocate.<\/p>\n Companies started to cut employees loose quite a while ago. What we see today is just a continuation of a trend to treat people as human\u00a0resources, as assets to be acquired and discarded according to the return for doing so.<\/p>\n <\/p>\n What\u2019s Missing?<\/strong><\/p>\n <\/p>\n What\u2019s missing from the current labor market is a sense of humanity\u2014as contrasted with lots of emphasis on efficiency, costs, and productivity.<\/p>\n Human beings are social creatures. We crave companionship, seek to be part of communities, and thrive on social support. Not surprisingly, solitary confinement is increasingly under fire for being cruel and excessive punishment. Research consistently\u00a0finds<\/a>\u00a0a relationship between social support and health, because social support in the workplace can buffer workplace stressors and contributes to physical and mental well-being. Working as free agents for multiple employers can separate people from workmates and a community that provide both job satisfaction and social support.<\/p>\n <\/p>\n