Why Harness Worker ‘Agency’

Pam Sornson, JD on March 19, 2023

Pam Sornson, JD

March 21, 2023

Measuring how employers value employees is only one element of the workforce development agenda. Another perspective examines how workers value their employers, which, it turns out, may have a bigger impact on current and future employment levels than was previously believed. Businesses that understand and facilitate their worker’s desire for ‘agency’ – the sense of having control over one’s actions and consequences – are more likely to have personnel who enjoy their work and are willing to contribute their valuable assets to share in the company’s growth.

 

Occupational Options Drive Employee Elections

As the COVID-19 pandemic continues to rearrange how the world works, it is also shifting the relative perspectives – and power bases – of workforce participants at all levels of that strata. These days, workers are commanding – and receiving – more recognition and respect from their workplace, but not through the use of vocal demonstrations or public agitation. Instead, they are asserting their value as a significant corporate asset and not just a commodity to be purchased. Employers who heed and respond to these new declarations of ‘worker agency’ may end up gaining a better workforce and a stronger company in return.

The newly popular opportunity to work remotely is just one of the influences on a worker’s decision about where to work and for whom. Throughout the pandemic, employees compelled to work from home using their personal technology were rewarded not just with an income but also with better control over their time – more agency over their occupational decisions. In many cases, companies continued to receive high-quality workforce performance despite giving up control over where or when those staffers were laboring. As the pandemic began to recede, the opportunity to work remotely became an attractive option for both existing and potential workers and remains so today.

That shift of power in the employee’s favor is having a profound effect on today’s workforce numbers. A 2022 survey revealed that many formerly employed people have voluntarily chosen to remain out of the workforce. Rather than acquiesce to their former work environment, which they found to be either uncomfortable, unfair, or both, they have chosen other methods of maintaining their lifestyle instead of returning to a job that they did not like. Of survey respondents, 36% reported being unemployed or furloughed from their former employment. Of those:

Almost one in five (19%) had adopted the title of ‘homemaker’ to describe their new occupation.

Another 17% had fully retired.

14% were working part-time, while 8% had started their own enterprise.

Notably, only 6% reported turning to some form of schooling.

Remarkably, the majority of these former workers who were intentionally shunning traditional employment opportunities were not financially well off. Almost nine in ten (89%) were earning less than $75,000 per year, and 83% of those were earning less than $50,000 annually. That reality suggests that, at least for some, living a reduced lifestyle because of financial constraints was better than making money doing something they didn’t enjoy doing or working for an employer they didn’t like or respect.

The survey respondents gave several reasons why they weren’t invested in finding full-time employment any time soon (some offered more than one reason):

28% cited ongoing health concerns that prevented them from looking for work.

27% were tending to family matters that would otherwise go unaddressed.

23% said family members were taking up the financial slack created by their unemployment.

Perhaps most relevant to workforce development professionals: over 40% stated that the wages in their industry weren’t competitive for their skill set and that they weren’t going to look until that circumstance improved in their favor.

While the survey itself was just a small sampling of the general unemployed population, it does reveal at least some of the very real and relevant factors that are impeding the country’s post-COVID economic recovery. Workers who can’t find employment that gives them both job and personal satisfaction won’t be contributing to the economic recovery effort.

 

Employer Options Encourage Economic Engagement

According to Deloitte, only 17% of business leaders feel confident that their companies are prepared to provide their workers with the employment standards now expected by many of the country’s unemployed. While most (84%) of the respondents to that 2023 survey acknowledged that ‘worker agency’ is essential to corporate success, thus far, they had only looked at or initiated the three major employee satisfaction practices that had arisen during the COVID-19 concern: insufficient compensation, home or office location, and control over working hours.

There are other opportunities and themes for employer/employee relationship exploration available, however, that may also prove fruitful:

Adopt the premise that those who share the corporate success journey should also share corporate success outcomes. For example, adding merit bonuses to compensation practices and instituting an employee profit-sharing program can enhance productivity across the enterprise.

Strategize, develop, and execute programs that support the worker-organization relationship. business leaders can contemplate how the employee’s voice and opinion can improve corporate practices and policies, for example.

Design tracking and monitoring practices to follow newly instituted procedures to embed those more holistic employment satisfaction conventions in place.

Doing nothing in the face of these workforce evolutions could prove disastrous. The global scope of the ‘workforce revisioning’ process suggests that how, when, and where corporate productivity is accomplished is no longer just a C-Suite decision. There are pockets of laborers in almost all countries who are clamoring for both more power and more satisfaction from their occupation, and that may be the new ‘workforce development’ normal.

 

Here in the U.S., survey responses appear to indicate that a significant proportion of the now-unemployed or under-employed population would rather not work than work at a job they don’t like. If that situation continues, then America will continue to face a critical shortage of workers in its national workforce. Organizations without a sufficient or well-trained workforce aren’t able to maximize their investments, market share, or profits. Reduced corporate productivity results in reduced tax revenues for communities. Employers, companies, and industries should note these concerns and do what they can to remedy their organization’s workforce challenges if they intend to remain in business and compete in the global market.

Rebuilding Workforce Power

Pam Sornson, JD on March 19, 2023

Pam Sornson, JD

March 21, 2023

Economic recovery and growth for all are – or should be – the fundamental goals of the emerging global workforce landscape. However, in many countries, the ‘status quo’ of shareholder/business owner dominance over all economic decision-making remains in place, even though it erodes the capacity of the workforce and threatens to derail the rebound and recovery process.

Instead, organizations of all sizes might consider embracing a more equitable corporate management structure that encourages and adopts worker input as a critical element of leadership strategy. The shift in perspective doesn’t just improve workforce conditions in general; it is also a more viable path to true economic recovery for the greater community.

 

Strategic Declines

Economists have tracked the rise and fall of worker power over the past ~70 years, as post-war industrial activities triggered union growth, and subsequent corporate evolutions suppressed those efforts.

In 1964, union membership in America was at an all-time high, with union participation in the Midwest and West Coast states averaging more than 33% of all workers. Union membership offered significant benefits for all participants:

It held wages steady through shifting economic times;

It helped to reduce wage gaps among workers, especially between men and women and whites and people of color;

It assured better working conditions and safety protections on the job, and

It often offered better paid-leave opportunities than those received by non-union members.

The primary power of that workforce voice was to influence where and how the company invested its resources. Maintaining a capable and confident labor force was deemed a priority, so corporate leadership focused as much of its attention on those values as it did on other enterprise activities. Consequently, company revenues were distributed more equitably throughout the workforce, a reality that drove the growth and success of America’s middle class.

By the 1970s, however, the perspective that encouraged worker satisfaction was changing. Company owners and shareholders were working to erode the standards established by union demands and often used nefarious tactics to accomplish those goals:

Union activists were often fired from their jobs to remove their influence from the general workforce.

Corporations introduced ‘captive audience’ (mandatory) meetings to promulgate views opposing worker rights, often using veiled threats of unemployment and firing if employees balked at their assertions.

The emergence of a ‘union avoidance’ consulting industry throughout the 1970s demonstrated the popularity among business owners of efforts to limit worker power.

By the 1980s, complaints about unfair labor practices had grown more than seven times over that number in the 1950s.

The primary reason why these evolutions away from worker power were so successful is that the country’s laws facilitated those actions. From the 1940s through to the 1970s, several laws favoring employers over employees were enacted; it wasn’t until the 1970s, however, that businesses began pursuing those legal remedies:

The 1947 Taft-Hartley Act authorized the National Labor Relations Board (NLRB) to prioritize defending lawsuits against unions for their ‘secondary activities,’ such as cases involving illegal terminations of labor organizers.

Laws designed to protect workers frequently had ineffective remedies that didn’t address the problems that were occurring or weren’t properly applied by the courts.

The U.S. Supreme Court also weighed business interests with more gravity than worker’s rights and agreed to limit the employer’s bargaining obligations. Without a legally enforceable mandate to collaborate on workforce concerns, companies were free to fire disgruntled workers in favor of hiring those who wouldn’t rock the corporate boat.

Consequently, as labor power diminished, so did worker wages, protections, and benefits.

 

Facing a New Economic Reality

Over the past three years, economic upheavals have triggered a resurgence in efforts to rehabilitate the worker’s rights agenda. While some industries shrank and sluffed off their workers, others expanded at an alarming rate, and businesses engaged in those sectors are now struggling to find the staff they need to capture emerging economic opportunities.

At the same time, more workers than ever were taking control of their (existing or potential) work situation to demand better pay, better hours, better benefits, and a stronger voice at the C-Suite table. Despite the economic chaos experienced in 2020 as the world essentially shut down its industrial operations, more than 47 million workers left their jobs in 2021 in search of a better quality of life than their previous occupation was providing. While many have found new work that better suits their tastes and capacities, many of the sectors they left behind have yet to regain their previous stability. Several of these industries are those that had traditionally hosted union activities, and one that is particularly hit by job losses (and now suffers a high percentage of unfilled job openings) is durable goods manufacturing.

The manufacturing industry has long been based in America’s Midwest and still holds a significant place in those regional economies. At the beginning of 2020, however, it lost approximately 1.4 million jobs because of the pandemic. In 2023, it is still seeking both entry-level and skilled workers to fill those vacancies, and those workforce gaps are having a profound – and negative – on those local economies. The situation is becoming more dire as time passes, too, with experts predicting a record 2.1 million unfilled jobs in this sector by 2030. There is a myriad of reasons why these job positions remain unfilled, one of which may be because, for so long, workers on those manufacturing floors had no voice or control over the quality of or satisfaction they derived from their work.

 

Today’s economic uncertainties are roiling the conversations and decisions happening in board meetings, director’s offices, and workspaces. The confusion creates opportunities for new employer/employee collaborations that promise to improve the good fortunes of both. They also offer hope that the overall community will benefit too.

Defining the New ‘Workforce Ecosystem’

Pam Sornson, JD on March 6, 2023

Pam Sornson, JD

March 7, 2023

‘Human Capital.’ ‘Talent Management.’ ‘Employee Experience.’ ‘DEI.’ ‘Critical Skills.’ ‘Work Models.’ ‘Contingent Workers.’ While these individual terms are now familiar to most business leaders, they are coming together these days in a new configuration. They are being used to describe an emerging philosophy of workforce administration. Conventional practices no longer serve the needs of either employers or employees. Instead, as the pandemic recedes and new business habits materialize, optimal productivity mandates embracing the whole spectrum of worker capacity and utilizing those unsung resources to build a better workforce and a better community.

 

Business as Not Usual

The work world is evolving away from ‘one-size-fits-all staff management’ practices (typically time clocks, ‘regular hours,’ paid time off, etc.). Instead, tomorrow’s employment professionals are discussing the aspects of a new ‘workforce ecosystem‘ concept that embraces the shift away from ‘work-a-day’ norms and toward happier, more enlightened ‘productivity assets.’

Several factors are driving these innovative developments in workforce management, many of which were triggered during the COVID-19 era and most of which appear to be inevitable anyway, given the swift advance of technology.

 

Labor Force Factors

Three elements in particular drive evolving expectations in the labor sector:

The absence of available workers – The pandemic didn’t just force thousands of people from their jobs. It also drove thousands of others to quit intentionally. And despite significant job growth in the past two years, the country is still struggling to get work done, with three million fewer workers on shift compared to February 2020. The impact of those labor gaps is felt in every industry because businesses can’t compete, grow, or thrive without a fully functioning workforce in place.

The rise of ‘worker agency’ – Almost three years of global economic disruptions have dramatically changed the employer/employee relationship. In many instances, a dwindling labor pool transferred power over employment details from the boss – who needs workers – to the worker, who has little, if any, competition for the job. Consequently, incoming staff have a stronger voice with corporate leadership regarding wage rates, working conditions, and enhanced opportunities for bonuses and promotions.

Generational challenges – The era of spending a lifetime in a single career is ending as the baby boomer generation ages out of the workforce. Not only is there no population of any size to fill in those gaps, but those subsequent generations – the Millennials, Gen Z, and now Generation Alpha – together are smaller than the boomer group, and they have a decidedly different perspective on the meaning of ‘work’ and how they want to pursue their careers.

Marketplace Factors

The nature of work is also changing rapidly. Companies are struggling to adapt traditional methods and assets to emerging opportunities, even when those promise greater profitability and success.

Technology has completely eliminated some jobs while making many others distinctly more complex. The capacity for staff to work remotely adds unprecedented flexibility for both company and worker while also adding layers of management needed to oversee the associated risks and logistics.

‘Skills-based’ occupations have replaced ‘job title’ postings for many companies. Hirers are looking for qualified workers who have the skills needed for the job, so potential hires are prioritizing their skillsets over their past employment positions. In some cases, a worker well-skilled in critical activities is more valuable to the corporation than a less skilled but ‘better educated’ colleague. The deviation toward skills and away from book learning as the fundamental training format is engaging new work and career options among those workers who might not have pursued a job at all.

The need for agility is also becoming more significant for corporate success. Today’s markets move faster than ever, and new, competitive products and services are introduced daily. Keeping up with the competition is imperative to organizational survival, and having a staff that is capable of adapting swiftly to marketplace changes is equally critical.

 

Think Outside the Cubical

Looking ahead, today’s business leaders should be contemplating how they can improve their organization’s productivity in three years, five years, or a decade. That new iteration will almost certainly not look like today’s conventional ‘business’ configuration. But it should not look like an unorganized mishmash of traditional and innovative work management styles, either.

Instead, today’s leaders can strategize through the chaos to an enlightened and energized new enterprise by addressing and overcoming the two biggest hurdles to growth – an unprepared corporate culture and entrenched, inefficient work processes.

The management ‘mindset’ should be the first target for innovation. The corporate culture will transition into its new, more fluid configuration when managers intend to lead it there. This new workforce management strategy will require ‘executive control’ to shift from ‘direction’ to ‘orchestration.’ Rather than marshaling workers and their individual efforts, leaders at all levels of the organization should think of orchestrating the aggregated outputs of those human resource assets to achieve corporate goals.

Eliminate the now obsolete ‘job title’ composition of labor hierarchy and embrace the “workforce ecosystem” mindset as the new “workforce development strategy.” This ecosystem can be whatever the organization requires; it is essentially ‘boundaryless’ in that it incorporates and values the contributions of all workers, regardless of their title, role, or worker status.

Establish an open workforce objective that emphasizes skills and contributions over traditional ‘laborer’ metrics and provides the support that each worker needs to be successful, whether they are full-time employees, contractors, or some other form of paid contributors to enterprise success.

 

These days, employees want – and can command – better recognition for the individual skills and abilities they bring to their job. Companies that do well at satisfying these newly identified requirements can harness those added values into a corporate ecosystem that builds both a better business and a better community.

Risk as a Value Proposition: Evaluating Workforce and Human Risk Factors

Pam Sornson, JD on March 6, 2023

Pam Sornson, JD

March 7, 2023

Risk is rampant these days, especially after the pandemic and its subsequent economic upheaval upended the global homeostasis. Many conventional practices and norms have been eliminated, and, in some cases, their replacements have yet to emerge. As a result, there are now yawning gaps and voids currently roiling the systems society relies on for service and support.

Other realities have also become starkly evident as the health threat recedes, especially when it comes to valuing labor. Some jobs were discovered to be obsolete, so they disappeared. Other formerly ‘menial’ occupations were revealed to be ‘essential’ to society’s functioning. In both cases, communities were dismayed to learn that their fundamental beliefs about work and its value were so incongruous with reality and, therefore, also unsustainable.

As the world approaches the post-COVID future, the workers who lost their jobs are clamoring for new, as yet undeveloped positions, while those who stoically performed the difficult ‘essential’ services are now demanding to be recognized – and compensated – for assuming those risks. The question is: how will the industrial community respond to these new demands and expectations?

 

Risk as a Spot Light

The COVID-19 pandemic revealed elemental yet hidden risks that are often inherent in virtually every industry.

In many cases, the risk grew from simply maintaining a product or service that suddenly presented a threat to life and health. When the government declared the spreading virus a national emergency, all kinds of ordinary, everyday activities ended abruptly, which also terminated the jobs they generated. Movie theaters went dark, restaurants closed in the thousands, and any form of public gathering quickly disappeared.

In other instances, the risk involved relying on (what eventually proved to be) unreliable sources for critical supplies and materials. Throughout the global supply chain network, most producers experienced at least some delivery delays of materials due to a lack of supplies, workforce, or both. Many reported a related escalation in costs as they paid ’emergency’ rates for any available substitutions.

In still other cases, the risk involved maintaining a fully staffed workforce to keep up with production quotas and orders. Any occupation that required a physical, human presence often also presented the risk of infection, which then prevented millions of employees from working lest they spread the disease throughout their organization. Many businesses closed for this reason. Further, as the pandemic wanes, many of those workers who became unemployed then are finding themselves in high demand for their skillsets and experience now. Accordingly, they are expecting higher wages than they received in the past, which presents an emerging risk to potential employers that they won’t be able to pay sufficient salaries to rebuild their labor force back to pre-pandemic levels.

These pre-pandemic risks are primarily related to the organization’s operational and financial activities, and many boards of directors focus their discussions on mitigating these risks to the corporation.

What they’re missing, however, is that these hazards are even more significant for their impact on the human workforce, which often bears the brunt of their effect. These leaders haven’t yet built into their management philosophy strategies to mitigate the risks to their human capital assets (such as infection by a potentially lethal virus), which means they also fail to protect the enterprise when those assets become unavailable. Managing the human risks within their enterprise is just as critical to their company’s success as managing the risks to their operational activities.

 

Embracing New Workforce Fundamentals

Shifting the corporate mindset to accommodate these emerging ‘human workforce risk factors’ is perhaps the best way for the industrial community to respond to new and evolving labor force demands and expectations. Not only would any such changes positively impact the workforce in general, but they might also enhance the agility and resilience of the organization as a whole.

The new management style goes beyond ‘workforce safety’ as the sole ‘labor-focused’ standard. It adds accountability for both internal and external factors that impact how, where, and why work is performed.

At the very least, the C-Suite should consider the physical, mental, and psychological risks their workers face each day and design compensation and benefits packages that reflect those heightened concerns.

In addition, an overarching review of corporate culture can embed ‘risk assessment and management’ at all employee and occupational levels to ensure that each worker is clearly informed of existing and potential risks and given the opportunity to choose to assume those challenges.

It also encompasses the well-being of the communities in which that labor is produced so that the company is assured of a strong workforce well into the future. Well-paying work builds well-supported communities.

Not least, the full implementation of this new style of human workforce management requires input and attention at all levels of leadership. Boards of directors, in particular, are responsible for considering the welfare of the workers who are building the value of the enterprise. A strong workforce emerges from more than just a robust HR office.

Many corporate directors may consider these evolutions too expensive or disruptive to be considered seriously. However, the dangers of maintaining the status quo most likely far outweigh the cost of improving the occupational situation of their workforce. These days, workers themselves are demanding improvements in their occupational environments to not only reduce risk to themselves but also to add value to them as people, employees, and community members. In addition, the consuming public is more aware these days of the values provided by all workers, not just those in the public eye for their high compensation levels. And since many of them “shop with their feet,” it is imperative for the leadership of every organization to be aware of and respond to their customer’s preferences, especially where social concerns are involved.

 

Risk is everywhere and is unavoidable. The very real threats posed to human workers throughout the COVID-19 pandemic are becoming far less tolerable to a society that has seen firsthand how damaging unmitigated risks can be. Organizations that intend to thrive through the pandemic and into a stronger, more resilient future will work now to mitigate and avoid future threats to the health and welfare of their human labor force. By doing so, they will build a stronger, more resilient workforce, as well as a stronger, more vital organization.

CCCCO Progress on the Calls To Action for Equity

Pam Sornson, JD on February 20, 2023

Pam Sornson, JD

February 21, 2023 

Working towards an economic recovery that builds equity principles into society’s foundational fabric requires a reinterpretation of how we value labor. If, as a society, we intend to enhance the value of our most important natural asset – our human workforce – then we must reevaluate:

– how we ‘classify’ workers,

– the relative merit and utility they offer and provide,

– the risks they face,

– the benefits they bring to the community, and

– the social and economic outcomes they achieve on behalf of everyone.

There are multiple systems still in place that negatively influence how we value ‘labor.’ In too many cases, they act as entrenched barriers to the economic growth we are all now looking to achieve. However, agencies across the state, region, and County are actively dismantling these obstacles, including the California Community Colleges Chancellor’s Office (CCCCO) and its constituents. The country’s largest community college system may be moving slowly toward progress, but progress is definitely being made.

 

Guided by the Vision for Success

California’s community colleges aren’t new to the idea of equity as an economic driver. In 2017, the CCCCO introduced its “Vision for Success” (V4S), a series of goals and commitments intended to improve the likelihood of success for all of the State’s (then) 2+ million community college students. At the heart of the V4S lies its foundational principle: combat racism and embedded inequities by ensuring that all learners receive the supports they need to achieve their educational, occupational, and life-long goals.

The CCCCO enhanced its commitment to the V4S in 2020 by issuing a “Call to Action” (CTA), a plan to mobilize the strategies and efforts toward student and community  equity into six focus areas:

1 Evolving and modernizing the education, training, and curricula for law enforcement officers and first responders.

2 Facilitating open dialogues to reveal and address campus ‘climate’ realities.

3 Auditing classroom climates to be more inclusive and create action plans to develop an anti-racism curriculum.

4 Reviewing and updating the Equity plans mandated of District leadership boards.

5 Shortening the time frame for the full implementation of the Diversity, Equity, and Inclusion Integration Plan (DEAI).

6 Joining and engaging with the Vision Resource Center strategy: “Community Colleges for Change.”

All of these approaches – those of the CCCCO and those occurring on the State’s 116 community college campuses – are geared toward establishing a system that treats no one learner differently from all others, provides the support needed for every student to achieve personal and occupational success, and engages the skills, talents and economic capacities of California’s entire eligible workforce in the State’s recovery from the pandemic and its aftermath.

 

Progressive Improvements

In June 2021, the CCCCO published an update on the system’s CTA progress, which demonstrates its overarching commitment to fulfilling the goals of both those directives and those of the V4S. And while that forward momentum is slow, it is absolutely happening across the vast complex of the California Community College network. Incremental advances at individual schools and within districts and regions improve its capacity to provide its students with the best possible chance for economic success, regardless of their race, age, ethnicity, or ability.

 

Call to Action Updates:

Review law enforcement and first responder training and curricula.

Injuries suffered during the civil unrest caused by racially driven incidents shone a bright light on the overuse of physical and sometimes deadly force by California police agencies. In response, the CCCs hosted many policing practice and accountability initiatives to raise awareness of both the issues at hand and discuss new ‘best practices’ for policing approaches. In 2022, the State passed the Peace Officers Education and Age Conditions for Employment Act of California, which mandates raising the eligibility age of officers from 18 to 21 years and requires that all incoming officers have, at minimum, a bachelor’s degree. The CCCCO has launched an interagency task force to design the new degree program. Recommendations are expected by June 1, 2023.

Improving the DEI Campus Climate

To improve anything, one must establish a beginning baseline. Over the past two years, the CCCs have hosted events, community circles, and listening sessions, inviting their marginalized and underrepresented constituents to share concerns and fears. At the administrative level, colleges have used the DEI theme as the centerpiece of conferences and collaborations and as the central focus of the Trustee Fellowship conference, which gathered CCC Trustees from around the state. Within the CCCCO, ‘equity’ as a distinct focus has become a more explicit component of the Guided Pathways program.

Auditing classroom climates to be more inclusive and to create action plans to develop an anti-racism curriculum.

Entrenched biases are more difficult to eliminate because, often, they are simply invisible within a culture. However, across the CCC network, leaders are openly discussing equity and bias challenges and holding workshops for chief instructional officers and other school leaders to reveal and explore these conditions. Additionally, college districts are looking to embed DEI criteria into their staff tenure and evaluation processes. The goal of the CCCCO is to establish a statewide model that replaces obsolete and damaging hiring and retention practices with strategies to enhance the inclusion of all participants at all levels of the Community College sector.

Reviewing and updating the Equity plans by District leadership boards.

In 2018, the CCCCO partnered with the USC Center for Urban Education to create a Student Equity Plan Review report. The report clearly shows how ‘equity’ plans at each school fail to “produce and sustain racial equity between groups.” More recent analysis indicates that existing programs don’t comport with the CCCCO’s CTAs, either. However, its clarifications have helped each school and district see where they missed the mark, and provide guideposts for developing policies and practices that genuinely focus on reducing and eliminating hidden biases from fundamental school activities.

Shortening the time frame for the full implementation of the Diversity, Equity, and Inclusion Integration Plan (DEAI).

In 2020, the CCCCO embraced a ‘Diversity, Equity, and Inclusion Integration Plan (DEI Plan) that encompasses three of the six CTAs. The task force that was convened to develop the DEI Plan was subsequently tasked to assess how well the network and its schools were working towards its goals. That group determined that the CCCCO and its agencies had made significant progress. Among many other successes:

They codified the DEI statement into Title 5 of State Regulations.

They provided equivalency guidance across the CCC network to assure accessibility and equity in hiring practices.

They introduced the student voice by adopting strategies from the CCC Student Senate into the Anti-Racism Student Plan of Action.

Through to the end of 2022, the task force continued its work developing campuswide bias and cultural competency training, creating additional professional development opportunities, and enhancing DEI training for classified staff and part-time faculty.

Joining and engaging with the Vision Resource Center strategy: “Community Colleges for Change.”

The community college-focused webinars available through the Vision Resource Center straddle the multitude of complex and intertwined themes that overlay all CCC activities. Its digital status facilitates access for all CCC personnel, and it shares the knowledge and experience of industry experts with attendees. Diverse topics inform stakeholders of critical and emerging trends in their sectors; bias and racism cross into all aspects of the CCC system. The portal’s success was revealed early: its two 2020 webinars (June 3rd and August 19th) attracted over 35,000 participants.

 

Looking forward, the CCCCO is contemplating new tools to track post-completion outcomes using an equity evaluation. It is also working at aligning its investments and resource allocations to more broadly and thoroughly encompass equity principles. As indispensable stakeholders in the economic and workforce development sector, the CCCCO and its 116 community colleges are doing all they can to move toward producing a highly skilled, well-trained workforce that represents the full scope, depth, and breadth of California’s diverse community.

Outcomes, not Activities: Equity as a Consequence

Pam Sornson, JD on February 20, 2023

Pam Sornson, JD

February 21, 2023

The past two years have marked a sea change in how the world views its diverse and colorful population. Reports of racially motivated hate crimes against individuals and whole communities are published globally, highlighting how deeply rooted biases can override the essential humanity of almost anyone. In consequence, more organizations than ever before have pledged to reduce their contribution to the debacle by investing in programs and strategies addressing the mostly silent biases inherent in their enterprise.

What they might consider doing differently moving forward, however, is to focus on equitable outcomes, not equitable practices. To achieve an entirely equitable and diverse workforce, every company must begin tracking and measuring the products and results of its equity-development practices – does it employ and advance more people of color? Differently abled people? How are they represented in leadership positions? Are compensation levels commensurate with skillsets? Job risks? Corporate value?

Deloitte suggests that too many organizations don’t see or don’t address the challenges within their DEI programs or corporate systems that interfere with their ability to engage a fully and genuinely diverse labor force.

 

Investment Does Not Equal Success

Global investments in DEI commitments have skyrocketed since 2020. Multinational corporations are developing strategies and implementing programs to address and rectify the adversities suffered by their ethnic, LGBTQ, and differently-abled employees. By doing so, these companies have demonstrated their awareness that bias is socially corrosive and, at least outwardly, their intent to eliminate it from their corporate culture.

Along with those investments come promises, however. Either explicitly or implicitly, the labor force impacted by those assertions is now expecting them to be fulfilled. Consequently, companies must do more than simply perform their “DEI strategy”; they must also track the results of their efforts to ensure that worker outcomes match the new standards they’ve set. Achieving those diverse workforce outcomes requires an additional step beyond strategizing toward it as a goal.

 

Barriers to Equitable Success

There are barriers, however. Researchers have revealed four common challenges interrupting an entity’s movement toward achieving its DEI goal.

Spending too much time and energy on activities without a comparable investment toward outcomes.

According to the Deloitte 2023 Global Human Capital Trends survey, almost one in four responding organizations (23%) measured their DEI progress through compliance activities. However, compliance programs often register only outputs as a metric and not the outcome that that body of metrics comprises. For example, the number of formerly fostered students is an important metric for all schools to report. Often these learners need a different set of supports to succeed in college. The more significant data, however, would be how well those educational structures facilitate their economic and occupational successes after they leave school. Those outcomes reveal the true ‘success’ of the DEI strategy.

Solving company concerns, not individual worker woes

While it is true that a ‘company,’ ‘organization,’ ‘enterprise,’ or ‘corporation’ is, in itself, a single entity, for DEI purposes, it should be viewed as a constellation of its entire workforce. Keeping that concept clear can be difficult in many organizations, especially large entities with far-flung offices and worksites. In these cases, the C-Suite may declare its DEI efforts successful if it has in place the professional development, inclusivity, and bias training opportunities that signify awareness of the problem.

In too many cases, however, having these high-level training capacities available isn’t enough to trigger the system change that true equity requires. The company must also find and measure the equitable improvements experienced by individual workers, such as pay raises or promotions.

Collecting insufficient or inaccurate data

In some cases, an enterprise may measure and report its “diversity” status (and therefore ‘success’) by counting the number of people of color it has on its payroll. While that statistic may appear impressive on its surface, it fails to capture the true extent of the company’s DEI reality. Organizations that want to capture data relevant to DEI outcomes should add systems that track more granular information, such as employee retention, advancements, leadership roles, and job satisfaction, to name just a few. This body of data will reveal how well diversity, equity, and inclusion initiatives are woven into the corporate culture because they will show that both the company and its workers are advancing and succeeding.

Silo’ing DEI actions away from other corporate objectives

True corporate success integrates DEI principles deeply into the corporate culture by enmeshing it with all other corporate goals and objectives. Companies can grow and evolve when they embrace the broader panoply of opportunities inherent in the wider, more diverse base of their entire community. Deloitte describes this phenomenon as ‘the Purpose Premium,’ suggesting that organizations that ingrain all their activities with DEI and other socially valued elements experience a competitive advantage through six key market drivers: improved reputation, innovation, market valuation, operational efficiency, risk mitigation, and talent outcomes.” Companies that display their culture of purpose see significant benefits from the practice:

78% experienced higher brand recognition over their competitors;

53% gained new markets and their consequential new revenues streams;

64% of companies with a product sustainability purpose were able to lower their logistics costs, and

78% of job seekers reported choosing a company with purpose over one that did not assert that attribute.

 

Investments in the development of DEI initiatives and programs are well worth the time and money they consume. However, those investments are just the beginning of the transformation of a company into a truly equitable enterprise. To achieve equity for the business and its workers, leadership must focus on how their expenditures generate economic and social outcomes that reflect their purpose-driven goals and benefit their workers and their greater community.

Case Study: LA County Uses Equity Principles to Transition Away from Fossil Fuels

Pam Sornson, JD on February 4, 2023

Pam Sornson, JD

February 7, 2023

One of the barriers impeding progress from inequitable practices to fairer conventions is the presence of a false dichotomy: ‘There is no other way to do what we’re doing now, so there’s no reason to change our current practices.’ This position prioritizes the status quo over social and economic advancement, regardless of the actual opportunity to make meaningful change. It is just one of the obstacles to full social equity that Los Angeles County (County) is tackling in its strategy to transition away from fossil fuels.

 

Developing a Comprehensive Strategy for a Just Transition Away from Fossil Fuels in Los Angeles County

In 2021, the County elected to combine its focus on both the development of fair work opportunities with its goal of transitioning away from its reliance on fossil fuels. The initiative embraces the need for a switch to renewable, sustainable fuel sources while also minimizing the negative impact of the challenges that will undoubtedly arise in related industries as those transformations evolve.

The strategy follows the County’s adoption in 2019 of its ‘OurCounty’ sustainability plan. Considered one of the most progressive sustainability plans in the country, the OurCounty initiative couples a forward-thinking definition of ‘equity’ with 12 sustainability goals. Achieving all 13 objectives will help the County realize its ultimate goal: a healthy, thriving, financially secure economy that provides stability and mobility for all County communities.

 

First: Use the Achievement of ‘Equity’ as a Driver Toward Justice

The OurCounty plan begins with its definition of ‘equity,’ which it parses into four integral aspects:

Procedural equity embraces and engages local and regional stakeholders in developing region-wide plans, strategies, and actions to ensure all interests are recognized and represented.

Distributional equity oversees the distribution of county assets across all sectors of its constituents, with a focus on populations with the highest needs.

Structural equity institutionalizes accountability at all levels of leadership to witness, acknowledge, and reconstruct existing cultural and historical dynamics that prioritized privileged groups and caused chronic and cumulative disadvantages to subordinated populations.

Transgenerational equity considers the long-term impact of current decisions to prevent them from inappropriately burdening future generations with unnecessary and preventable consequences.

The definition seeks to address the multiple negative ramifications of previous governmental and social actions that have wreaked havoc on the region for decades. By incorporating these aspects into the overarching OurCounty plan, Los Angeles County can capture, embrace, and build on the assets, abilities, and skills of all its diverse populations in its quest for a more productive and inclusive economy.

 

Second: Knit Equity Principles into Each of the 12 Strategic ‘Clean Energy’ Goals

The goals describe how the County intends its residents to live and work as it weans off its reliance on oil and gas resources:

Goal 1:  Residents will thrive in place with adequate access to natural resources (clean water, air, and soil) in safe and secure housing and communities. This goal aims specifically at the County’s former practice of ‘redlining’ home mortgage loans by minorities to keep them out of predominantly white neighborhoods.

Goal 2:  Communities will attain a healthy and resilient physical infrastructure that respects the importance of proper interior insulation from heat and cold and an external tree canopy that cleans the air and provides shade.

Goal 3:  The County’s land use and development activities will be based on sustainable principles and won’t unnecessarily or inappropriately displace settled communities.

Goal 4:  Homeowners and businesses will be encouraged to embrace renewable resources for every possible purpose. The initiative builds a new reliance on ‘green’ energy as it moves away from petroleum products.

Goal 5:  The goal recognizes and seeks to heighten protections for the County’s physical and geographical assets, including its islands, mountains, beaches, and coastlines. Human encroachment and poor ecological management practices threaten the health and welfare of the diverse flora and fauna of the region.

Goal 6:  All County residents will enjoy the use of its parks, recreational areas, and public lands, which will be adapted to facilitate the access by all, regardless of ability.

Goal 7:  Eliminating County-based fossil fuel production refineries and related services will also eliminate the threat of – and actual – pollution that those now generate. Replacing them with renewable options will result in cleaner air, reduced wildfire threats, and the amelioration of ongoing concerns posed by climate change.

Goal 8:  A clean, convenient, and affordable public transportation system will enhance mobility options for all County inhabitants, increasing their quality of life while reducing the County’s dependence on cars.

Goal 9:  This goal tackles concerns that arise when the current overuse of finite resources taxes their availability in the future. Water, in particular, is becoming more scarce for a variety of reasons, which compels better management of it for both today’s and tomorrow’s consumers.

Goal 10:  Affordable food that is accessible, healthy, and safe should be available to all. This goal will help develop a sustainable food delivery system for all the County’s residents.

Goal 11:  Ensuring accountable actions and decisions by public policymakers mandates that all the County’s diverse communities have a voice and presence in those discussions, their implementation, and management. This principle is especially significant in areas that have been marginalized by previous inequitable conventions.

Goal 12:  Embrace and build on assets and inputs offered by all affected County populations, including the public, private, and non-profit sectors. The combined effort of the collaborative, inclusive partnership will enhance and improve the lives of all County dwellers while creating a clean and sustainable future for the region.

 

As the community evolves in this post-COVID era, it has the opportunity to develop resources that are newly revealed by that pandemic and those that will replace practices that are now obsolete in the current economy. Building the equity lens into the strategy provides not just more assets to include in the process (those of previously marginalized populations) but also new, fairer avenues to correct decades of previous transgressions. By adopting the ‘Just Transition’ strategy, Los Angeles County sets itself – and its communities – up to be leaders for the country and world in achieving a safe, fair, and clean economy that supports all its constituents.

 

The Economic Cost of Inequity

Pam Sornson, JD on February 4, 2023

Too many people remain unaware of the negative impact that inequitable actions have on the economy. Long-entrenched cultural ‘norms’ embedded in mainstream practices and services erode the foundational quality of life for those who suffer discrimination and those who remain ignorant of implicit yet very real biases. These unjust behaviors will continue unabated unless the community makes a concerted effort to reveal them, discuss them, and change them. By doing so, everyone in society will benefit, not just those who will (finally) be treated with the respect and recognition that they have always deserved.

 

Shining a Light on Inequity

Images of racism – especially violence against Blacks and other people of color – play out on television monitors with increasing frequency. Women continue to struggle to earn as much as men for doing the same work. The ethics, skills, and talents of people ‘of an age’ or with different abilities go unnoticed or disregarded in favor of other, often less qualified labor candidates. Two and a half centuries of flawed beliefs and systems have rooted these discriminatory behaviors in all sectors of society and in every industry. Yet, they all have adverse economic effects that impact everyone, not just the oppressed. Until the community faces and addresses them, it will continue to suffer those unnecessary financial losses.

Discrimination Against People of Color

By one economist’s reckoning, the economic cost of racism against black Americans is an estimated USD $16 trillion accrued over just the past 20 years. In addition to wage disparities, this community also suffers from discriminatory lending practices, limitations on education capacity and availability, and reduced access to well-paying employment. The impact on the rest of the community is significant, especially in light of the fact that the US gross domestic product (GDP) in 2021 was $21 trillion. Harnessing the resources lost due to the financial deficit caused by racism against Black Americans would be enough to pay off half of America’s 2022 $31.5 trillion national debt.

Discrimination Against Women and Differently Gendered

The ‘gender gap’ also costs the country a pretty penny every year. A Center for American Progress article asserts that women earn just $0.83 for every dollar paid to a man in 2022. Women of color earn less than that. These factors remain consistent even though the capacities of women to attain education and careers have significantly increased over the past 30 years.

The reasons for this type of economic disparity are many. Women continue to shoulder most of the homemaking and child-rearing duties, which are most often not compensated and cut into their capacity to earn money. When they do work for compensation, their occupations often require inflexible or longer hours than those demanded of men. Not least impactful is the fact that many trades remain gender-segregated and have much higher populations of male workers than they do women workers. Consequently, women of all colors experience higher levels of poverty than men.

Discrimination Due to Ageism

Despite their decades of experience and skill building, workers aged 45 and over continue to experience a consistent pattern of bias, at least in the seven countries recently surveyed by McKinsey. Their study revealed that of all the unemployed laborers in those OECD countries (Organization for Economic Cooperation and Development), 40 to 70% were older than 45 years. Of those, 63% had been unable to find work in over a year, versus 36% of people under 45. The loss of this workforce cohort group is significant; it is the most educated labor population in history and enjoys the best healthcare outcomes ever recorded. The productivity and expertise resources that remain untouched in this group are immense and could, if harnessed, unleash an unrivaled economic boom capable of lifting thousands (if not millions) of people out of poverty.

Discrimination Against the Dis- and Differently-Abled

In many cases, people with disabilities or who are differently abled are barred from or face challenges to gainful employment because the world still does not see them as valuable employment assets. A 2017 study by the Office of Disability Employment Policy found that only one in five people with disabilities (20.1%) were employed, compared to almost 70% (68.6%) of non-disabled people of the same age. These populations also face challenges attaining higher education, financial stability, and optimal health because of their differing intellectual, physical, or developmental capabilities. In some cases, the inability to work is because the occupational opportunity is simply not physically set up to accommodate the needs of a differently abled person. In other cases, employers, businesses, and industry sectors have not designed their facilities to accommodate a differently abled workforce. Despite the passage of the 1990 adoption of the Americans with Disabilities Act, people in this population are twice as likely to be impoverished as those workers with conventional capacities. Further, this group is also subject to significant additional costs to manage their condition, known colloquially as the “crip tax,” which compounds the difficulties of their plight.

Each of these individual groups harbors immense talents, skills, and abilities that could add millions or trillions of dollars to local, regional, and national economies. These potential assets are ignored, however, not for any valid reason, but because society has arbitrarily deemed them to be less than optimal as workers.

 

While certainly not alone, America holds a unique position in the world because, in many cases, its racial and other biases are so widely publicized. In fact, a recent exposition by the World Economic Forum cites the killings of George Floyd, Breonna Taylor, and Ahmad Arbery as examples of global systemic racism. A 2019 study found that a staggeringly high percentage of Americans still don’t recognize the size, scope, or importance of the yawning gap of economic inequality that exists in their country. The economic casualties caused by the COVID-19 pandemic open up the opportunity for the United States to begin shrinking this gap to harness these invaluable human resources for the benefit of their communities and the nation.

 

 

 

 

 

Exploring ‘Essential’ Inequities

Pam Sornson, JD on January 17, 2023

Pam Sornson, JD

January 17, 2023

So here’s the conundrum: ‘essential‘ means ‘absolutely necessary’ and ‘indispensable,’ as in ‘an essential element must be in place, or disaster may/will follow.’ At the same time, what type of element is deemed ‘essential’ often depends on who makes that determination. As the global industrial complex restructures in the wake of COVID’s massive economic overhaul, more entities – businesses, industries, and governments – are applying the lessons learned throughout that era. They are now re-imagining how they identify, estimate, and then compensate those workers whose efforts genuinely keep the world moving forward – those who have been deemed ‘essential.’

 

What Work is Actually ‘Essential’?

Just a precursory view of how individual states define ‘essential’ within their borders reveals how people across the country differ in their opinion about that status. Granted, at the beginning of the pandemic, no one was certain about anything, especially not about how to respond to or mitigate the viral threat. Every government agency at every level was struggling to determine what needed to be done and who would be doing it. Adding to the national quandry was the fact that each state is unique – they all have their individual economies, populations, and regional characteristics, so no single state-based response to COVID was going to work for all states. It’s interesting, then, to look back and see the decisions made in the separate states about what services or products were ‘essential’ to them:

In late March 2020, of the 17 states that had then issued stay-at-home orders, only one elected to close its liquor stores because they were deemed non-essential. Pennsylvania closed its alcohol supply centers at the end of business on March 17th after those businesses racked up almost $30 million in sales the day before.

At the same time, ironically, Pennsylvania also determined that its medical marijuana dispensaries were “life-sustaining” and, therefore, essential. Most states that had legalized the drug also kept their suppliers open.

In Arizona, the Governor declared that the sport of golf was ‘essential’ to the state so all of its courses could remain open. Notably, Arizona’s golf industry accounted for just $2.2B in state revenues in 2019, just a small percentage of that state’s annual ~$320B GDP. The Governor, himself a golfer, stated that retaining recreational activities with appropriate safety guidelines (social distancing, in this case) facilitated the mandate.

Even gun stores were deemed ‘essential’ in some places but not in others. In California, while the state’s list of essential services did not specifically include gun shops, regional law enforcement agencies were making their own decisions about what would happen in their county. In San Diego County, they were open, while, just 120 miles away in Los Angeles, they were not.

The seemingly arbitrary determination of “essential” poses significant challenges at both the state and federal levels, as both government systems struggled to appropriately allocate funding to address COVID’s challenges.

 

Inequitable Pay + Inequitable Risk

The chaos created around the country by the ‘what is essential?’ question revealed a larger, more insidious reality. In many cases, those jobs that were ultimately deemed ‘essential’ were also often considered ‘menial’ and, therefore, were at the bottom of the pay rate scale. Workers in these lower economic tiers, therefore, were expected to continue working through the health crisis even though doing so exposed them to a potentially lethal virus. When those workers are also non-white, the risks posed to them by the virus multiply:

Based on 2018 data reflecting 152 million workers, while 31% of Hispanic workers and 33% of black workers were performing essential services, only 26% of white workers had the same occupation.

Black workers were particularly vulnerable to developing severe illnesses caused by COVID-19. Long-standing inequities in healthcare access by this population have resulted in the rise of several comorbidities that can complicate or conflate the severity of a COVID infection.

Workers on these lower economic tiers were also less likely to have a safety net of sick days or paid time off, so not working because of illness wasn’t often an option.

One in seven of them lacked healthcare insurance.

One in three was living in a household that earned less than $40,000 per year.

According to Chicago’s School of Public Health, numerous reports released at the beginning of the pandemic indicated that essential workers:

were more likely to be [non-white],

had lower levels of education,

were paid less than white workers, and

often lacked health insurance.

So how is it that the country that puts such a high value on the labor produced also puts such a low value on the person who’s performing it?

 

Should ‘Essential’ Also Mean ‘Highly Valued’?

The substantial wage and occupational inequities exposed by the pandemic reveal a long history of devaluing America’s non-white workforce. According to some economists, poor working conditions and circumstances for women and people of color are the consequence of labor laws written and passed to establish that reality. According to them, society has chosen this inequitable environment because it facilitates the enrichment of certain social classes at the economic expense of others.

 

The good news is that society can also change its priorities to reverse and repair these ‘essential inequities.’ Government review of fundamental economic principles – such as how to value labor – can develop policies to increase minimum wage levels and provide all workers – especially essential ones – with more protections against occupational threats such as those posed by COVID-19. Expanding tax options such as the Earned Income Tax Credit can help workers keep more of their earnings in their own pockets.

In short, the COVID-19 pandemic is giving society the opportunity to re-determine how it demonstrates its value for its labor force.

 

 

The Impact and Import of ‘Essential’ Workers

Pam Sornson, JD on January 17, 2023

Pam Sornson, JD

January 17, 2023

Millions of ‘essential’ workers are now seen as the unsung heroes of the COVID-19 pandemic, having risked their lives to ensure that social, safety, and economic systems remained functional throughout that global ordeal. However, despite the incalculable value they delivered, in many cases, the average compensation rate to these workers is at the lowest end of the pay rate scale.

That reality begs a question: if these roles are truly essential to the survival of the community, then why isn’t that value reflected in how much workers get paid for their labor? The clarification of which services are deemed ‘essential’ to the country’s security revealed the significance of today’s wage disparities and how America (the world?) assigns value to the effort of its workforce.

 

Essential Effort is Not Equitably Rewarded

The COVID-19 pandemic introduced America (and the world) to the concept of ‘essential workers,’ those people whose jobs and efforts are deemed “critical to ensuring the continuity of critical functions in the United States (U.S.).” Their significance to national safety and security was made evident when state and local governments issued blanket ‘stay at home’ orders to mitigate the spread of the disease. While most people followed that mandate, civic leaders quickly realized that not everyone could stop working. Some occupations were determined to be integral to societal functions, and those functions could not stop regardless of the severity of the COVID-19 threat. Accordingly, governments made an exception to the ‘stay at home’ rule and allowed these workers to return to their workplaces and jobs.

What surprised many people, however, was the scope and depth of the job classifications that were deemed ‘essential.’ Across virtually every industry, almost half (47%) of all employees performing essential services were earning less than $15 per hour. In many cases, these jobs didn’t require significant education or skill; instead, workers provided physical labor to perform routine tasks. Cashiers, janitors, and stock clerks, three very familiar ‘essential employee’ examples, averaged just $12 per hour, yet their effort facilitated fundamental economic, sanitation, and supply chain services that supported the entire state.

 

 

16 Sectors – Three Priorities

In total, the government identified 16 ‘Critical Infrastructure’ sectors, each of which supplied vital social and community services. Workers were asked to continue to work in these roles throughout the pandemic so there would be no interruption in the nation’s foundational infrastructure operations. And because of the crucial nature of their occupation, government leaders organized their activities into three categories to prioritize the allocation of the first COVID vaccines as those became available.

1a – Healthcare Workers

The Healthcare and Public Health Sector was first on the list of essential services because its activities protect the country from many potentially disastrous hazards, including natural disasters, terrorism attacks, and infectious disease outbreaks. Not surprisingly, this massive workforce was prioritized at the front of the ‘essential service’ line. That line included anyone who labored in any type of health management facility, including paid and unpaid workers and those whose activities were not directly in contact with potentially infected persons.

A notable feature of this sector, however, and one that is relevant to ‘how we value labor’ is the fact that the vast majority of facilities delivering healthcare services of any kind are privately owned. In all corners of the country, access to healthcare services is available only because private organizations have created those resources.

Consequently, the value of the labor provided at those facilities was not established based on its “essential” nature but instead on conventional labor market supply and demand principles.

1b – Non-Healthcare, Frontline Responder Workers

Employees who were deemed second in priority as “essential workers” were those providing emergency services. This population is the frontline workforce of Fire and Rescue Services, Emergency Management, public works, and law enforcement personnel who are first called and first to on the scene of potential disasters. During COVID, these people were exposed to the virus during the course of their work performance, and they were often compelled to work in close proximity to infected persons. Again, like healthcare personnel, they were mostly employed by privately owned companies which were the entities that established their economic value.

1c – Infrastructure Sector Employees

This category of workers encompasses those occupations that provide fundamental support efforts to maintain the local community. Until this pandemic, society hadn’t acknowledged the immense value to the economy that these workers offered; they certainly weren’t classified as ‘essential.’ However, as the “stay at home” order was extended over time, the absence of these workers and the labor they performed was keenly felt by virtually everyone, everywhere. Industries and businesses that maintain this foundational infrastructure workforce include those in water and waste management, food services, transportation and logistics, housing and shelter, information technology and communications, finance, energy, law, media, and non-health-related public safety. And again, most of the employers of these workers are in the private sector and use those metrics to establish and compensate for the relative value of their workforce.

 

The essential services produced by the other sectors are also significant and also, often, not recognized for the foundational benefits they provide:

The chemical sector, which produces, uses, stores, and transports potentially toxic chemicals and materials.

The commercial facilities sector, which provides gathering spaces for large numbers of people and operates on the principle of open public access.

The critical manufacturing sector, which encompasses the development and implementation of metals and machine production.

The dams sector, which administers and controls the country’s water supply.

The defense industrial base sector, which spans the globe and enables the development and delivery of military weapons systems.

The energy sector, which includes oil, gas, renewable, and other energy sources. More than 80% of this essential service is privately owned.

The government facilities sector, which includes all facilities owned or leased by the nation’s government systems.

The nuclear energy sector, which includes almost all of the country’s civilian nuclear infrastructure.

 

These next few years will be pivotal for the country as it transitions from the pre-COVID/COVID era into a decidedly different post-COVID economy and community. One key lesson learned throughout the pandemic was that the economic allocation of value on a person’s work effort does not always adequately describe the societal value that action provides. Looking forward, it may be more advantageous to employees, businesses, and the community as a whole to value the labor performed by its workforce as much by the social significance it represents as well as by the time and training needed to accomplish the task.

Social Value: Labor Valued by Benefits Conferred

Pam Sornson, JD on January 2, 2023

Pam Sornson, JD

January 3, 2023

Another aspect of defining the ‘value of labor’ is to explore the benefits that ‘work effort’ convey to society. In addition to generating revenues for companies and workers, the labor involved in building businesses, industries, etc., brings fundamental taxation revenues and resources for the community as a whole. From that perspective, the value of labor might be measured by the quality of a community’s fundamental infrastructure systems.

 

Comparable Labor Metrics: All or Just Paid?

Commercial and industrial economic resources, however, flow from paid labor. How does society measure labor that isn’t compensated? How does it evaluate the value of goods and services contributed simply because offering them is deemed a moral imperative?

Innumerable global, regional, and local nonprofit agencies provide invaluable services and products to their communities with no (or few) expectations of financial compensation from beneficiaries. Feeding and sheltering the unhoused, maintaining public land for public use, and furnishing counseling and support for disenfranchised citizens are just a few examples of ‘labor’ performed for the public good and not for compensation or another recompense. Other community members cover the costs they incur as an added element to the service. Appraising the benefits conveyed through the outputs of volunteer effort, then, often requires measuring their impact on both their target populations and the communities in which they live. So how does a society describe the ‘worth’ of these services when their delivery conveys uncompensated benefits in pursuit of higher social values?

 

Social Contribution as its Own Value

One community in the United Kingdom is exploring this concept through its ‘Social Value’ policies and practices. The city of Salford, 200 miles northwest of London, England, aims to maximize the power of its private and public financial investments by tying them securely to its Social Value principles. In its definition, there are two avenues of social values that can enhance the lives of the entire Sanford community, should all its residents decide to embrace them:

Its core social value encourages building socially and economically viable growth and development opportunities into each contract and agreement, both public and private. For example, construction businesses could sponsor and host apprenticeships through their contractors and subcontractors. These learning opportunities provide invaluable education for local students, learners, and adults and build a labor force infrastructure for the future.

Salford then expanded its roster of social values by encouraging the pursuit of best practices in all aspects of its economy, including environmental management, ethical purchasing, local employment, and other business activities that demonstrate respect for the community.

Launched in 2013, Salford directed its social value policies to engage its citizenry in building and sustaining non-financial, community-wide benefits that would augment positive outcomes, including happiness, well-being, inclusion, empowerment, and environmental care.

 

 

Articulating ‘Social Values’

Within that scope, Salford’s Civics planning commissions and public and private enterprises were then encouraged to consider a broader scope of values when investing their resources into individual Salford projects. The town developed a list of social value criteria that companies could use to assess their own social value parameters and then implement into existing or new projects. Civic leaders determined the town itself should be the role model and adopted the criteria as the foundation of its planning and practices strategies. These criteria explore both the challenges that the little city was facing as well as activities and initiatives to address those concerns.

 

As a ‘Growing’ City:

Salford would prioritize projects that pursued these goals and practices throughout its employment, hiring, and contracting processes: reducing worklessness, increasing workforce resilience by reducing sickness absences and keeping people employed, paying a living wage to its employees, promoting the use of local labor, improving education and skills, strengthening the local economy by buying Salford-based goods and services, developing strategies to attract new businesses and help them thrive, and facilitating good connections between the city and its local commercial community.

As an ‘Innovative’ City:

Salford will develop a better integration network across its existing and emerging systems, ensure that social services are available for all residents while addressing social concerns to reduce the need for social services, and reduce crime and disorder through advanced policy and practices. Salford will also enhance its environmental goals by using sustainable products, ensuring ethical purchasing of Fairtrade goods, improving public spaces, parks, and community areas, and reducing energy use.

As a ‘Cooperative’ City:

Salford will increase opportunities for volunteerism, improve the connections between volunteer sectors, social enterprises, and their mutual stakeholders, include the voices and presence of service consumers as contributors to the policies of their community, actively promote community cohesion and equality, encourage community resilience by facilitating ways for people to help each other, and increase the number of and celebrate Salford’s social values role models.

As a ‘Caring’ City:

Salford pledged to provide resources to improve family life, improve living standards for all while reducing local poverty levels, provide financial direction to reduce or eliminate economic inequality, provide health care direction to reduce inequalities and close the health gap within the town and between the city and the rest of the country, enhance public sector resources to ensure those who need social services can attain them, promote social mobility by informing residents of ways they can access educational, employment, living, and social opportunities, and increase the sense of community by actively pursuing a higher level of trust between leadership and the constituency and minding the mental well-being of its residents.

 

As a strategy, Salford’s Social Value charter provides direction and suggestions for businesses to engage in practices that give as much benefit to the community as they do to the company. By doing so, the work produced by each company and its labor force create value at all levels of the social strata for individuals, families, companies, neighborhoods, communities, and the town itself.

How do We Value Labor?

Pam Sornson, JD on January 2, 2023

The economic and workforce development sector constantly evolves as technology, social concerns, and an aging population disrupt a century of labor and economic traditions. While some occupations have remained steadily in demand, others have become obsolete, and still others have been newly generated. The state of constant flux in workforce modernization is now forcing changes in how society identifies the value of the labor necessary to keep it running. However, establishing new definitions for that (or those) value(s) is a challenge because there are so many variables involved in the activities described as ‘labor’ and an equal or greater number of outcomes that those activities produce.

 

Aspects of ‘Labor’

Defining the value of labor is an economic practice to establish how and why goods are exchanged for currency or other products. Some form of work or effort is needed to produce any product or service, and the laborers who make that effort expect some form of compensation from the consumers who receive it. The question is how to set a ‘reasonable’ compensation value for that effort.

Several notable theories attempt to explain appropriate methodologies for defining the value of labor, many of which center on the production of products or the value of the end product:

‘Labor Theory’ of Value

An early theory focused on the measurement of hours needed to produce a single instance of a commodity. This theory suggests that an item’s value should be determined by how many hours a worker invested in creating that product. This value is described as the “natural price” of the commodity but does not take into account the materials that were also invested in the production process. Subsequently, this labor theory was extended to include the value of those included materials, which was also valued based on their production cost. Those expenditures were added to the end product’s development cost. Economists set the value of the labor expense using a price/hour ratio and measured the value of the materials by the expense incurred creating or extracting them from their source.

Labor Supply and Demand Theory

The simple labor theory becomes skewed when third parties control the labor force, materials supply, and production facilities and can set arbitrary prices for those assets and the products they collectively generate. When any individual production asset – materials, workforce, or facility – is in short supply and limits the availability of the end product, the price of those products can go up. Businesses struggling to maintain their revenue streams due to a lack of staffing, for example, often increase the wage per hour value to attract that workforce asset, which may then also cause their product prices to rise. Further, emerging skill sets, such as technical expertise or complex problem solving, are also considered ‘valued’ elements of the product. They can add considerable proprietary values to the commodity and command a higher value per hour as more companies compete for that resource. The value of labor, in this case, is based on the type of labor offered and its volume as an available resource in the community.

‘Product Value’ Theory

Another way to define the value of labor is to attach it to the value of the product it produces, and in many cases, the value of that product is also relative based on its contribution to its consumer. Products designed and built to fulfill specific corporate or personal needs can fetch high prices in the marketplace when they successfully achieve those goals. Value-based product development practices focus on clarifying those specific consumer goals and then creating items that directly respond to those mandates. This process includes the selection of labor skills and abilities needed to create and produce the desired outcome, from its ideation to its ultimate creation. Producers whose products or services require precise skill sets will place a high value on that well-trained labor force and compensate those workers accordingly. Conversely, the labor needed for mundane or routine tasks is both more available and less taxing, so compensation for those activities is often much lower.

Other factors considered and establishing product value through a value-based development process include:

The size of the market for that product. Products that promise high popularity across populations will be valued more at that community level than those items designed for smaller, more distinct groups of consumers.

Demand for the product. Items that respond to the needs of many purchasers will be more popular than those developed again for more precise groups of consumers.

The value of the inputs to create that output. Companies with existing facilities and workforces can produce new products more quickly and at less cost than organizations that must first build out that infrastructure.

This economic theory sets the value of ‘labor’ based on end product value.

‘Service Value’ Theory

Valuing the labor involved in service performance is challenging, too. Services are transitory; they are the short-lived experiences of human engagement for specific purposes. Setting their price based on the time elapsed during their delivery doesn’t adequately capture the value they provide.

And services provide significant value to the community. In the third quarter of 2022, the U.S. Gross Domestic Product (GDP) value of services industries totaled over $14 trillion, up from just $9.7 trillion in 2005. Those industries span the full extent of the economy, including numerous health care services, food services and drinking places, data management and IT services, and legal services, to name just a few. In 2020, the “miscellaneous services industries” (professional, technical, and scientific services industries) added close to one trillion dollars to the American economy ($975 billion).

 

 

Each of these theories attempts to capture the economic benefits conferred by labor production on the community to the worker, the employer, and the consumer. In the following article, the Pulse will discuss the social value of labor and how “work” enhances the overall value of society.

 

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