The Transformation of Work
 by
Anne Federwisch
It’s no longer your daddy’s workplace—or your momma’s
either—acknowledged Edward E. Lawler, III, in his talk “The
Transformation of Work” at a recent meeting of the Business and Organizational
Ethics Partnership. The director of the University of Southern California’s
Center for Effective Organizations highlighted some of the findings from
his book The New American Workplace, (Palgrave-Macmillan, 2006)
co-authored with James O’Toole.
The book is a follow-up to O’Toole’s look at employment in
the 1970s, which he chronicled in Work in America. That book focused
on the actual tasks people did and how those impacted their health and
wellbeing.
“The [earlier] book was very critical of a lot of the work that
we had in the United States, in the sense that it was repetitive, boring,
provided people with little opportunity for personal growth and development,
and in some cases was simply unsafe. But the emphasis was not so much
on the physical safety issue; it was more on the mental health of the
country and the well-being of the people because of the conditions that
they faced,” Lawler explained.
With funding from the Society for Human Resource Management, Lawler and
O’Toole took another analytical look at the workplace, contrasting
it with what O’Toole had found 30 years previously. “What was
most dramatic to both of us was how many of the key issues today were
unanticipated in the 1970s and just how different the workplace is today
from one in the 1970s,” Lawler noted.
They organized the book around changes, consequences, and choices. Key
changes over the past three decades included dramatic organizational and
economic shifts. Businesses are more global and more competitive. Information
technology unimagined in the ‘70s pervades businesses today. And
the bulk of jobs in the United States has moved from manufacturing to
service and other kinds of knowledge work. “[Now there’s] a
very different set of issues around who owns companies, what they are
about, what kind of work they create, what kind of work processes they
have, what kind of technology they have,” he said.
Lawler and O’Toole then looked at those changes in terms of consequences
for the worker and uncovered some surprises. “People are more satisfied
with their jobs today than they were in the ‘70s—a little surprising,
given all that you hear about work-life balance,” Lawler said, “but
sensible, if you look at the nature of the work itself. People have more
discretion today. They need more knowledge and skills to do [their work].
They get better feedback in many respects about the nature of their work
and what’s going on. They have many more choices in terms of where
they work, how they work, how long they work, what kind of career they
can pursue. So maybe it’s not so surprising.”
Their analysis revealed two groups in particular whose satisfaction has
increased significantly: women and CEOs. Women have significantly narrowed
the gender gap in the last three decades in terms of salaries and access
to high-level positions in corporations. Females are reaching parity in
business schools and exceed male enrollment in some degree programs. As
for CEOs, they have enjoyed a dramatic leap in compensation from the ‘70s.
“Compensation has gone from wherever you want to start—30-1,
60-1—to 600-1, not to mention private jets and all kinds of other
stuff that makes their life better. So they’re clearly winners,”
he said.
Education is increasingly defining those winners. As the United States
moves from a manufacturing economy to a knowledge and service economy,
people who lack a high school degree (and in many cases a college degree),
are “in trouble,” Lawler warned, and the trend in the past two
to three years have become even more apparent. “It’s very clear
from the ‘70s to today that the bottom 5-10 percent of the population
typically does not have a high school degree and has lost purchasing power
relative to the rest of the population, even relative to inflation.”
The transformation of the American workplace has resulted in more choices
for the typical worker. “People today have enormously more choices
than they had in the ‘70s—many different kinds of jobs, many
more educational opportunities, etc.—but what’s very clear is
that the risks have gone up enormously,” Lawler said. “Individuals
have many more choices to make, but it’s not entirely clear that
they’re well-equipped to make those choices. They have to make choices
about career, continuing education, retirement funding, medical.”
Essentially, he said, today’s workers have to build their own brands
as employees, diagnosing what are good organizations to work for, what
kind of career tracks to pursue. “We make a fairly strong case that
individuals have to increasingly think of themselves as self-employed,
whether they’re working for IBM, or H-P or anybody,” he said.
Corporations, too, have choices. One of those involves management style.
Lawler identified three styles: the traditional, bureaucratic manager;
the low-cost operator; and the global competitor. “We make the argument
that in a lot of industries, the Wal-Mart strategy—the low cost,
low wages, poor benefits—may not be the best economic strategy, even
though it has the allure of being able to provide low prices,” Lawler
said.
Instead Lawler said he and O’Toole found organizations that were
competing successfully with both the low-cost and traditional models using
the global competitor approach. “They are clearly dependent on their
human capital for their effectiveness,” he said. They reject the
low-cost operator model, instead adopting a “mixed strategy toward
their human capital. They probably have a core group of employees who
are the technology leaders and senior executives, who have a relatively
strong attachment to the organization.”
Surrounding them are contractors, who have no long-term attachment to
the company. “Many of them are quite happy with that. They see that
as a great option. They don’t have corporate politics,” he said.
“But in between the contractors and this core group are a whole
bunch of people who have a new employment contract, if you will, which
is: we expect you to be really loyal to us in a sort of serial monogamy
relationship. As long as we want you, we want you to work hard, be loyal
etc., but realize that it could end at any time. If your performance slips,
if we decide to bow out of the business, if we decide to move your job
to Indonesia, you’re gone. There’s no safety net, there’s
nothing. You just better be ready. And we’ll make that decision based
on the economics of the business and where we think the business is going
to go, not based on concern for you. They don’t say it that way,
but that’s the reality,” Lawler explained.
Finally, the new American workplace means many choices for the government
as well. Should it step up a single-payer healthcare plan, removing it
as a workplace issue? “Our current health service situation not only
doesn’t serve most of the people, it doesn’t serve the competitive
necessities of the American corporation,” Lawler said.
And the government should play a leading role in continuing education
as well, he added. “We strongly argue that government needs to be
more active in continuing education for people who are laid off or displaced
by off-shoring of work, and also in situations just where technology may
have somehow [changed their jobs],” he said. “We need to invest
in education that will keep people current with technology. Obviously,
giving money to universities is a great way to do that, creating programs
at universities that both create technological breakthroughs that can
keep the US economy growing and educate people in those economies.”
Overall, whether the changes in today’s workplace are positive or
negative depends on one’s perspective, Lawler concluded. The data
suggest that people report more pressure to work and be productive than
ever before. Americans take fewer vacations and work longer hours than
in any other developed country.
“You can look at that as a disaster: here's a stressed-out, work-obsessed
nation. It's got all sorts of psychotic, neurotic people who are having
terrible lives,” Lawler said. “Or you can look at it and say,
‘Wow! These people really enjoy work. It's exciting! It's interesting!
It's rewarding! It's fulfilling! They have good friends there. They meet
challenging problems. They're upgrading their knowledge and their skills
all the time. What a wonderful world!’”
Anne Federwisch is a freelance journalist. Edward Lawler is Distinguished
Professor of Business at the USC Marshall School of Business.
October 2006
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