Episode 202 — The Labor Movement
On this episode of the Business and Society podcast, two professors from the Ross School of Business discuss the state of labor from an economic, industry, and organizational development perspective. They explore the factors of modern labor, recent striking action, CEO pay, and more.
For a majority of the podcast, guests Cindy Schipani, Merwin H. Waterman Collegiate Professor of Business Administration and professor of business law, and Jerry Davis, Gilbert and Ruth Whitaker Professor of Business Administration and professor of management and operations, focused on the factors disconnecting workers and organizations. As Davis explores at the beginning of the episode, there are three major factors leading to the current state of labor.
First, technology has fundamentally changed the context in which businesses operate and organize. Davis has coined the term “Nike-fication,” in which companies have become increasingly less centralized over the past decade. Secondly, the gig economy and employment are changing, making independent contracting a more popular and less governmentally protected mode of employment. Thirdly, globalization has decreased, and U.S. manufacturing has risen to historic highs. These three factors have led to the upheaval of traditional views on the employment market and increased pressure on workers to adapt and unify.
“There are a lot of good reasons for the workforce to be anxious,” said Davis. “The company that can retain that trust is going to be in a presumably better position to weather this. Their employees are going to be more willing to engage with the company and help them figure out how to move forward.”
Another major focus of the discussion was how organizational leaders can rebuild trusting relationships with employees. One glaring factor is the disparity between average worker and CEO pay.
As Schipani explored, there have been attempts by the federal government to make CEO pay more visible. However, these regulations have had two resulting factors. First, CEOs are comparing themselves with their peers, increasing the competition to attract top executive talent. Secondly, for the first time, workers know the numeric value they provide organizational leaders but don’t see it reflected in their own individual economic situations.
To close the conversation, the panel explores their advice for workers, lawmakers, and corporate leaders for easing tension and rebuilding trust between the workforce and hiring organizations.
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About the participants
Hosts and Producers: Jeff Karoub and JT Godfrey
Guests: Cindy Schipani and Jerry Davis
Audio Engineer: Jonah Brockman