The tsunami of resignations and difficulty hiring workers that has hit many industries leads to an urgent question: How can organizational leaders create better, more desirable jobs? That’s the question Zeynep Ton, professor of the practice at the MIT Sloan School of Management, discussed as a guest at MIT Sloan Management Review’s Work/22 virtual symposium on the challenges leaders can expect to face in the year ahead.
Ton started her presentation by noting that most leaders would rather offer good jobs than bad jobs — and yet millions of people have positions that offer poor pay, unpredictable schedules, and little security.
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Leaders lack awareness about how bad things have gotten, Ton said. Additionally, where there is awareness, there’s a lack of conviction to do anything about it. And where there is both awareness and conviction, there’s a lack of courage.
“I hear, ‘We already pay above-market wages,’ and, ‘Our engagement scores are high,’ and, ‘Why are employees still leaving?’ I hear this over and over again,” Ton said. Companies wondering why they can’t attract job candidates need to look at the base level of what people want and whether those hygiene factors are being met. Ton defined those needs as good pay and benefits, a stable and predictable schedule, a career path, and security and safety. Only after those elements are in place can workers worry about satisfaction, belonging, and meaningfulness.
Ton put wages into context. Before the pandemic, she noted, 46.5 million Americans worked in jobs that paid less than $15 an hour. This includes retail sales workers, movers, restaurant employees, home health care aides, and preschool and special education teachers. Annualized, that pay of $31,200 is below subsistence level for most families across the country.
Low pay leaves workers vulnerable to a vicious cycle of poverty: It makes it difficult to meet financial obligations, which leads to stress and health issues, which reduces a person’s ability to do a good job, which leads to high turnover and attendance issues — which leads back to low pay.
Not investing in workers creates a different kind of vicious cycle for companies, Ton continued. “Unit managers in these companies are constantly fighting fires,” she said. “They have no time to hire the right people, because there are operational problems, there are attendance problems, there are turnover problems.”
The way out is to embrace what Ton calls the Good Jobs System.