How American Workers Became Disengaged

If your employees are a company’s most valuable asset to ensure that the business runs smoothly, efficiently and constantly improves then why do we continuously fail to put people to good use?  

Good Question?!

Perhaps we can tie that question to another:

Why and How Did American Work Force Become Disengaged?!

Employees who have or will become disengaged, employers in the United States will not receive their creative, innovative and entrepreneurial power.  It goes further than just the creative ‘juices’. Without employee engagement employers are looking at high turnover and absenteeism and low productivity. 

During the past three decades, corporations have reaped record profits, CEO’s and COO’s are making record salaries (notice I did not use the word –earning). However, employee wages have both declined or languished.  

Disappearing are the positions in middle management of all types of companies – jobs paying between $14.00 and $21.00 per hour with benefits.  Why and how did this come about? 

There are six (6) reasons for this dearth of employee engagement.  They are the following:

1.   Corporate Re-engineering:

As the U. S. economy became in affected by with globalization many of America’s large firms commenced to reshape themselves to reduce costs.  They changed into lean and mean firms with fewer jobs.  Complete business functions or departments were either shuttered or outsourced or off shored.

2.   Decline of Unions:

As of 2013 the American labor force had only 11.3% of the population unionized.  This was the lowest percentage in almost 100 years.  A similar event took place in the private sector as the union force amounted to a mere 6.5% of the population.  This is a dramatic turn of events as in the 1950’s it was 35% of the population.  American firms made a determined effort to eliminate or weaken union grasp.  It is quite evident how successful they were.

3.   Automation:

Due to the great movement overseas resulting in massive downsizings, manufacturers have made investments in automation.  Automation has been successful beyond belief – eliminated millions of blue collar jobs and the internet has allowed companies to outsource and offshore many white collar jobs.

4.   Two-Tier Pay Systems:

One of the most subtle strategies created to reduce wages was the Two-Tier System.  This strategy rewards long time employees with keeping current wages and benefits but reduces those of all new employees. The sinister side of this is that it encouraged older workers to vote against younger workers in order to sustain their status.  As these older workers retire and replaced by newer and younger employees the overall wages are reduced.   The larger picture is that this system breeds disunity, fosters unhappiness and produces low morale because the younger employee is performing the same work as the older employee but only receiving two-thirds of the pay.  This system has been used in a host of industries – airlines, construction, chemical, printing, petroleum, food, textile, insurance, aircraft production, tire production and retail.

5.   Temporary and Part-time Workers:

Most of the jobs created since 2008 have been part-time or temporary ones. Part-time positions have grown from 1.9 million in 2009 to 2.7 million in 2013.  There are several reasons for this increase in part-time jobs.  A few of them are the following.  Some businesses are not convinced that recovery is here to stay, so why hire. Another reason is that consumer demand is still too low and many companies have too much inventory-on-hand.  Additionally, it appears that many firms will intentionally keep their headcount under 50 so as to be affected by Obama care.  Furthermore, these people are hired without health benefits but that only perpetuates the problem – people do not make enough money to support their families unless they have ‘relief’ I n the form of food stamps or other government support.

6.   Contract Workers:

Contract workers are a relatively new and increasing category of employment in this country.  These are full time workers who are self-employed, but not part of a company’s head count.  Thus, there are no benefits and pay their own taxes.  It is safe to say that contract workers are the future as employers continue to reduce head count. 

This relentless effort to reduce labor costs over the last 40 years has been quite successful, but it has created huge economic problems. Low and dormant wages have led to less consumption which has kept the GDP at a trivial 2% growth rate.  In addition, there is not enough consumption to purchase all the goods that America can produce.  It is clear that this economic model will continue into the future without any recognition to what has happened to the middle class.  

The irony of this story is in view of decreasing wages and benefits are the continued rise of CEO compensation.  Per the AFL/CIO report, corporate profits, salaries and benefits to CEO’s have risen 331 times as much as average employee. 

American corporations can become more competitive if they release the creativity, innovation and entrepreneurial spirit of employees.  Motivating them to give their utmost must start with a discussion on wages, benefits, security and equality.

Collaboration + Supply Chain = Security

Retailers Battling Cargo Theft Consumers think little of the security and technology needed to bring goods to market. Almost daily, cargo thieves are aiming at freight which is worth upwards to millions of dollars. The targets run the full gamut from food, drinks, electronics, home products, building materials, clothing, auto parts, and pharmaceuticals. As cargo theft gangs (think of the movie “Captain Phillips) become ever more organized, many logistics firms are signing on with loss prevention and risk professionals in order to keep the supply chain safe. Add to the mix that traditional means of securing property may not meet the regulations of the U.S. Customs and Border Protection or World Customs Organization; this compounds the problem of these external risks. There are several joint business ventures – Customs-Trade Partnership Against Terrorism (C-TPAT), Partners-in-Protection (PIP) and EU Authorized Economic Operator (AEO) – organized to strengthen the impact of supply chain and border security efforts. For example, with C-TPAT, companies can speed up the business process and capitalize on the efficiencies of the supply chain process. Price point is another factor influencing the logistics market. The choice of vendor may be a strictly price-driven idea but development teams are creating non-price point factors to acquire new business. We are beginning to see this with blanket insurance policies at no additional cost. With such policies in place this translates to the customer: if there is any loss during the supply chain process, the vendor takes on 100% of the liability and replacement costs. As well, with these policies, risk professionals are re-assessing risk models and employing new security measures. In the past, the greatest concern for many supply chain managers was ensuring security in their warehouses against deceptive pickups, driver theft, facility theft, etc,. Today, these concerns are the simplest and most easily ‘cured’ challenges the supply chain is facing. Today, the biggest challenge is when the product leaves the property. Product is most vulnerable when it is in transit. Even in the past when a large percentage of theft was internal, that percentage is falling due to more sophisticated and prevalent external cargo theft gangs. As a result of this increased risk to cargo, loss prevention professionals are instigating solutions to keep a step ahead of criminals and securing the assets after they leave the premises. One of the solutions is covert tracking of high dollar shipments, accomplished by inserting a GPS device in the shipment. If the shipment steers off course or the driver stops for a long time, an alert is immediately fed to the monitoring system for action. The screening of covert tracking can be active or passive. If active, security can visually track the movements of the shipment along the designated route. If it is passive screening, there are check points that the shipment must reach at allotted times. However, there is a downfall with both of these. The window of opportunity to steal a shipment is very small and by the time loss prevention personnel become wise to the problem, the shipment may very well be lost. Overt scrutiny is just that – obvious and out in the open. Usual method is to install a GPS and inform the drivers of such a device. This tells them the shipment and they are being tracked. Another overt method is to hire a third party escort. Vehicle escorts can lead or follow shipments from start of trip to the final destination. This process is labor-intensive and expensive, but it has proven to be most successful in ensuring product reaches its destination. The use of overt tracking is becoming increasingly prevalent, especially in the electronics and high dollar freight. Loss professionals by administrating a risk assessment and a cost analysis are capable of determining which method of tracking will bring best results – risk management and return on investment. Law enforcement and private security are concentrating their efforts on cargo theft in order to reduce the outside influences of crime in the supply chain process. The National Cargo Theft Task Force is taking the forefront on this attack. This group and others are working hand-in-hand with other law enforcement agencies; sharing information, technology and best practices. The challenges linked to securing the supply chain and its processes cannot be answered by one group. Solutions are only possible with collaboration between local, state, federal law enforcement agencies and supply chain management teams of all companies cooperating with each other.