Contractors | Working Stiffed

American Workers are Less Productive: No Job Security, No Motivation

American workers are not feeling the love. A lack of job security, combined with increasing responsibilities (and fewer resources) has resulted in exhaustion, low morale, lack of motivation and (drum roll please)…lower productivity.

The U.S. Department of Labor said last Tuesday, that productivity fell 0.5 percent in the second quarter of 2016, while labor costs rose by 2 percent. U.S. worker productivity has been weak for the past five years and stands at 1.2 percent, less than half of what it was before the 2007 recession, when it was at 2.6 percent.

Many economists say Americans are working more to create less, because workers have outgrown existing technology. As a result, we can expect “restraining” of wage growth and more layoffs. And so the epidemic of myopic economics continues.

Don’t these geniuses realize that reducing financial incentives and increasing employee workloads as the result of layoffs will only drive productivity down further? These “experts” may know the price of everything, but they know the value of nothing.

U.S. workers today are routinely being pushed to their mental and physical breaking points. Workplaces are toxic work environments staffed by people either in the midst of a psychotic break or on the brink of one. The stench of fear and uncertainty lingers in every cubicle, assembly line, water cooler, coffeemaker and non-subsidized vending machine.

It doesn’t help that employers like Disney, Toys ‘R Us, Xerox, Pfizer, and Microsoft are turning to “insourcing” of H1-B visa workers in order to lower their payroll costs, despite posting record earnings…and then they force their poor displaced American employees to train their “guest” worker replacements or forfeit their severance.

Corporate Hunger Games?

As an unwilling participant of the gig economy, I’ve been flitting in and out of different corporate offices for the past four years. The mass psychosis and/or post-traumatic stress disorder (PTSD) I see is alarming, but not surprising.

When you experience three or four (or more) reorgs a year and know that on any given day you could walk into work and be handed a severance package, even if you’ve been a rock star employee (damn those surprise mergers!), it’s bound to damage your psyche to some extent at some point. And at the end of the day, you become aware that there is no “i” in team, but there is one in “survive.”

This past year, I’ve had two assignments where the person responsible for training me held back information I needed to know in order to do my job. Both women were overworked and clearly needed my help, so I can only conclude that they felt that if I knew as much as they did, they wouldn’t survive the next reorg.

They obviously felt it was safer to be overworked to the point of mental and physical exhaustion than to have the well-trained help they desperately needed. How sick is that? Still, they survived round after round of layoffs and salary dumps, so I suppose it’s not an unrealistic fear to expect to be replaced by a contractor who probably made less than they did.

Needless to say, this epidemic of fear and loathing in workplace after workplace makes it hard to stick to a new employer, even when you do a good job under most challenging circumstances. It’s like an endless loop of different movies made with the same script. Sometimes, I feel like Bill Murray in Groundhog Day.

No rest for the corporate weary

This environment of perpetual job insecurity has scared workers into being on the job 24/7. According to a study by Project Time, more than half of U.S. workers left unused vacation time in 2015. In fact, over the past 15 years, American workers have been taking less and less vacation time.

These poor souls likely feel that if they take time off, their bosses might replace them with an intern or hourly contractor…or worse, that someone of importance may decide that their department functions just fine without anyone in their role.

These are the same people who make work calls after dinner and send emails at 11 p.m. on Saturdays in an endless quest for validation and job security. It’s madness! But this is exactly the frame of mind that bipolar CEOs value in their employees.

Rising labor costs? No shit!

Hiring people costs money, and when your business model involves having a revolving door of “talent,” even if you’re replacing 20 full-time employees with 10 gig contractors or H1-B visa guest workers, you’ll end up throwing a lot of good money after bad. Recruiters, equipment and training costs add up.

And then there is the learning curve. It takes a while (sometimes years) before most employees achieve optimal knowledge of their company and/or industry. Many employers learn the hard way that inexperience can be pretty costly, especially in industries that are heavily regulated.

And how many times have employers carelessly displaced long-time employees, only to find they also unwittingly displaced a lot of company knowledge that their low-cost millennial or H1-B visa colleagues didn’t have? Too many; but they repeat the process, anyway. Einstein said the definition of insanity is to do the same thing over and over and expect a different result. So, there you go.

And while we’re on the subject of insanity: If a company wants to treat employees like disposable widgets, then they should stop asking employees to participate in charitable drives in the company’s name. This is inconsiderate at best, and perverse (or even sociopathic) at worst.

Also, I’m not sure why this isn’t obvious, but it’s never a good idea to have leadership team members spew empty rhetoric about “teamwork” and “commitment” at employee or town hall meetings in the same breath that they announce layoffs. What is up with that? I can’t think of a better way to incite workplace violence or corporate espionage. Seriously.

When I worked at Philip Morris in the 90s, we were hit by lawsuits left and right while dodging regulatory challenges by the FDA. If our then CEO had followed today’s popular strategy of slashing headcount and hiring cheap labor, the company probably would have folded before the end of the millennium.

Instead, they doubled down on staffing up, paying above average salaries and they had the best benefits. They understood that if they were going to survive, they needed a knowledgeable and dedicated workforce. Not only did the company survive, but it thrived…the stock split multiple times during the 90s and they’re still around today.

If employees feel valued, enjoy support, and know that if they do a good job, they’ll not only stay employed but they can expect to be promoted and rewarded financially, well…there’s no end to the growth a company can experience. Until “leaders” rediscover the core fundamentals of entrepreneurial success, true growth and peak productivity will likely remain elusive.

Yes, it’s true. Obamacare has sentenced me to death…and financial destitution. I feel it’s important to address this issue on this, the last day we are told to register for Obamacare without incurring an unconstitutional tax penalty.

I have been without health insurance, which I cannot afford, for a year-and-a-half and I live in a state that does not extend Medicaid to people in my position. As a result, I am one serious disease or accident away from certain death.

After dutifully paying taxes for close to 40 years, helping to send other people’s kids to school (I don’t have kids) and funding food stamps and benefits for thousands of people, my government is repaying me by turning its back on me during my hour of need…and penalizing me for my new-found destitution, to boot.

How did this happen? I am a 52-year-old woman who was last employed in a full-time position with benefits four years ago; I was part of a group purge after my company was acquired by a competitor. This scenario is familiar to most of you, I’m sure. I thought I’d find another job with benefits easily, but I was wrong.

As The New York Times recently reported, women over 50 account for half of all long-term unemployed people. After remaining steadily employed in good, white collar lower management positions for more than 30 years, I was suddenly an unwilling participant in the trendy new gig economy out of necessity.

For this I owe a big thanks to Bill Clinton and NAFTA, which destroyed the American middle class by allowing companies to ship jobs overseas and import H1-B visa “guest workers.” Now, many of us find that we’re unemployable more than 20 years before we can collect a pension (if we even have one) or Social Security (if it will still exist by then).

My new reality involves going months without work, or “contracts,” and even when I do get a temporary contract position, my “clients” periodically cut my hours without warning. As a result, I made less than $10k last year.

Needless to say, I can’t afford the so-called affordable insurance Obama promised. According to the Affordable Care Act (ACA) health care exchange marketplace, I’d need to pay $550 a month for a policy with an $8,000 deductible. And what good is a subsidy when you go months without any income?

A low-cost, pre-Obamacare catastrophic insurance policy would be helpful right about now. Unfortunately, Obamacare-less forces me to buy an overpriced policy with a high deductible, so that I can share the privilege of paying for some dude’s Viagra prescription and pediatric dental insurance (like I said, I don’t have kids).

To make things worse, I’m about to get hit with the Obamacare penalty…and this is on top having to drain my savings and take hardship withdrawals from my 401(k) (which I am also about to be unfairly penalized for) just to survive in our “new normal” transient, gig economy that mainstream media finds so hip and trendy.

I’ve decided that if something happens to me health-wise, I’m just going to die, because if I am hospitalized, I stand to lose my home and what little I have left, so why bother sticking around?

If you like Obamacare, it’s probably because you don’t need it

I am so tired of brainwashed Obamacare defenders crowing about the 12 million Americans who couldn’t get insurance before now having coverage. Frankly, in a country of 330 million people where close to 100 million are out of the workforce (many not by choice), that’s a drop in the uninsured bucket, so bragging is totally uncalled for. Maybe they’re promoting this “success” because they know that math-challenged Common Core students are easily impressed by any number you throw at them.

Obamacare supporters are also quick to blame states that don’t extend Medicaid. Why? Should citizens of states that aren’t on board with Obamacare be penalized? There wasn’t a Medicaid referendum in any state that I am aware of.

And, if Obamacare is supposed to mandate affordable insurance for all, why didn’t it nationalize Medicaid? At the very least, it should exempt those of us who live in Medicaid-deprived states from Obamacare.

And then there’s the pre-existing condition clause. Sorry, Obamacare defenders, but I’m not down with being stuck with the rest of this ugly baby just for that one benefit. Besides, a single-payer health care solution would take care of pre-existing conditions just as effectively. As it stands, the insurance companies are offsetting their pre-existing condition “losses” with double-digit rate increases each year.

Not surprisingly, I find that the strongest supporters of this crony capitalist screw job are people who have employer-paid health insurance or at least make or have enough money to overpay for their insurance.

I know a couple of people who used to sing the praises of Obamacare….until they lost their jobs, were forced to join the gig economy, and had to actually rely on Obamacare for coverage. Needless to say, both have now joined the repeal Obamacare bandwagon.

It’s unconstitutional

The lie Obama sold us (among many) when he was promoting this travesty was access and affordability…and, of course, we couldn’t keep our doctors, after all (not that we can afford them now anyway, so I suppose this is a moot point for those of us who inhabit the Obamacare penal colony). I admit that I bought the spin. I even voted for the lying clown. What we got instead was a gun to our heads forcing us to purchase an overpriced product from PRIVATE companies or face hefty, escalating tax penalties.

No income limits were set; whether you make $10k (or less) or $100k a year, if you don’t buy insurance, you get taxed. Seriously? How is that legal? Or fair? First of all, people who make less than $30k shouldn’t pay ANY taxes, never mind have tax penalties imposed upon them.

And if Obama was so hell-bent on insuring us, why didn’t he mandate maximum premium amounts that insurers could charge? Say, $200 a month? Let’s call Obamacare what it is: a blank corporate welfare check to the insurance companies.

Not a peep from presidential candidates

NOT ONE presidential candidate has addressed this travesty. Several running for president are sitting members of Congress. They’ve taken a two year paid vacation on our tax payer dime to attend fundraisers and campaign for an office most don’t stand a chance of winning. Must be nice.

NOT ONE of them (including our socialist man of the people, Bernie Sanders) can be bothered to spare a moment to introduce legislation NOW to at least waive the “Cadillac tax” penalty. No, instead of nuking the toxic provisions of Obamacare, Congressional members voted to repeal the whole thing, knowing that the president would veto the resolution….pure theater…or political masturbation.

As a member of Congress you have a unique opportunity to demonstrate your leadership abilities through legislation, and there’s no time like the present. That’s probably the ONLY advantage you have over Donald Trump. Talk is cheap. So, why not lead by example? Because, frankly, too many of us don’t have a year to wait for action…nor do we trust empty campaign promises.

Speaking of leading by example, I invite Obamacare defenders to show me how great it is by contributing funds to pay my Obamacare tax penalty and/or my monthly insurance premiums. On second thought, the way our economy is going, maybe you should hang on to your money…you’ll probably need it to pay for your own “affordable” Obamacare insurance someday.

It’s less than a week before Christmas, so it must be time for Congress to perform yet another hate crime against the American people…the people they were hired to represent (but rarely do). As always, they try to slip through the most revolting legislation in the dead of night, preferably on a holiday, when they hope most of us will be too drunk on eggnog to pay attention. I’m surprised they didn’t pull this latest legislative abomination on Christmas Eve, actually. Maybe they were counting on all of us to be blinded by light sabers after watching the latest Star Wars sequel.

At 2 a.m. Wednesday morning, Paul Ryan, unveiled a trillion dollar omnibus spending bill to his colleagues that included a number of jaw-dropping provisions; many of which further assaulted U.S. workers and our ability to find and retain meaningful employment. Basically, the bill:

Strips protections for low-wage American workers
Quadruples the number of foreign workers in the U.S. through the H2-B visa program

Meet the new boss…same as the old boss…

Paul Ryan, the overwhelming choice for House Speaker (by both democrats and republicans) after John Boehner was “smoked out” a few months ago, has now ably demonstrated that the more things change, the more they stay the same.

If they ever consider making another “Despicable Me” sequel, Paulie can throw on a gender-neutral, yellow minion costume and drag on Boehner’s nicotine- and alcohol-stained coattails, while obediently squeaking incoherently.

Wedged into the 2,000 page bill was a provision that allows employers to import up to 264,000 low-wage foreign workers under the H2-B “guest worker” program; this more than quadruples the 2015 maximum of 66,000. The program allows these low-skilled “seasonal” workers to stay for up to 10 months.

Apparently, Congress thinks that there are an awful lot of jobs that Americans won’t do. We know otherwise. Up to 200,000 blue collar hotel, construction and other service industry workers could find themselves out of work without re-employment options. The omnibus bill not only allows employers to set migrant worker wages, it also allows them to cut the hourly wages paid to American workers. How’s that for representation?

The bill was passed by the House (by a 2-1 margin) just days after the Pew Research Center reported that the American middle class is indeed shrinking, and just weeks after another recent Pew Research poll found that 83 percent of American voters want to see the level of immigration frozen or reduced.

Sen. Jeff Sessions (R-Ala.), expressed his exasperation in a passionate speech on the House floor; he chided his colleagues for readily supporting the bill, despite the fact that the nation’s labor force participation rate is at just 62 percent.

“The people sent us here (Washington) to protect their interests,” Sessions said. “They did not send us here to bow down to the president’s lawless immigration policies or to line the pockets of special interests in big business.”

https://www.youtube.com/watch?v=PBqrWL3h9-g

Sadly, Mr. Sessions…that’s just what they did. The hubris of this group is unbelievable. How long will we allow this to go on?

Being a freelancer these days has a lot of perks: you make your own work schedule and you can work from the comfort of your home, thus you can avoid messy office politics, getting stuck in commuter traffic and blowing your ever-shrinking “gig economy” earnings on a “business casual” wardrobe and workplace lunches.

Sure, there are some challenges to freelancing, like convincing clients that your rates are reasonable while they plead poverty or hide behind budget cuts, or getting them to pay you on time (or at all), or having to diplomatically push back on their requests for additional revisions or input that they don’t feel they should have to pay extra for.

Still, the biggest challenge I’ve found as a freelancer is my lack of psychic ability.

If you’re a freelancer, you may have noticed that your clients tend to fall into two categories:

Small businesses that need to hire you because they don’t have the in-house talent to do what you do (e.g., marketing, Web development, etc.).

Middle managers in mid- to large-size companies that have downsized their marketing or IT departments into oblivion who need you to help them get the work done (without having to offer you a steady salary or benefits).

Champagne Dreams on a Spam Budget

Small business clients don’t like budgeting for anything outside of their company’s inventory, so when they reach the painful conclusion that they need to hire you to help increase their brand’s visibility, your biggest challenge is usually managing their expectations.

Even if you find yourself pricing their projects on the low end of your rate scale and they can only offer you a limited amount of work, some clients will expect your handiwork to deliver astounding results in record time.

This is when the fun starts. With some small business clients, you can expect one or both of the following outcomes:

(a) You will spend the next three months asking for your money.

(b) Your client will continue to ask/expect you to do more work outside of the scope of your original agreement until they feel they got an adequate return on their investment. Some of us foolishly keep feeding this beast in the hope that someday these clients will actually pay us for the original work.

If you were psychic, you could avoid a lot of aggravation by knowing ahead of time who won’t pay you or who will likely run you into the ground making you “earn” your money.

I May Not Know What I Want…But I Know What I Don’t Want

Sometimes it’s easier to work with mid- or large-size businesses, because the manager who hires you is more likely to process your invoice…unless they are so overworked that they keep forgetting to do so (which happens more often than is acceptable). Still, as long as they have the budget, you’re not likely to get any push-back or experience unreasonable haggling.

The biggest challenge of freelancing for larger companies is that the mid-level managers who tend to hire you are so overworked that even though they desperately need your help, they often don’t have the time to provide you with what you need to do the job right.

As their hired gun, you’re priority No. 59 on their long to-do lists…way below assisting their VPs and other important business stakeholders, planning the company United Way drive, booking their vacations, arranging their bimonthly date nights with their spouses, finding babysitters for their children or getting their dogs groomed.

Sometimes these clients don’t even know what they’re asking for, while other times all they know is what they don’t want. And woe to the freelancer who receives limited guidance and inadvertently submits what they don’t want.

These clients expect you to have the skill to write or develop exactly what they would, if they only had the time. So what if they’ve had months or years to become well-acquainted with their company’s business objectives, and to attend company-sponsored training and meetings on a regular basis when you haven’t? You oughta know what they’re looking for, anyway, dammit!

The Phantom Lucrative Project

Another potential pitfall of being hired by a large company is one I call “the phantom lucrative project.” A typical scenario involves you blocking out weeks to do a job after being hired by a large, reputable company. Sometimes, you’ll be so happy you got the gig that you’ll celebrate by going on a shopping spree for laptops, patio furniture…or food, if things have been tight for you financially of late.

Then, you hear nothing more from them. When you contact your client, you are given excuses as to why the project is being delayed (e.g., they were on vacation, the project still needs approvals that your client wasn’t aware weren’t in place when he or she hired you, etc.).

The fact that you turned down smaller projects to work on their mega-project doesn’t resonate with them. After all, these people get paid even when they’re working on their tans in Cabo.

Sometimes, if you’re really lucky, you’ll wait for weeks to start the project only to be told that it’s been canceled (again, for any number of reasons from budget cuts, to the need to move resources to a more important project, or the project has been mothballed so long it’s actually now irrelevant…or the sponsor was terminated).

Having the psychic intuition to avoid these phantom projects would help keep you that much further away from financial ruin.

Having a pay-or-play deal in place would also help. Unfortunately, unless you have a waiting list of clients or you’re regularly profiled by the top trade media in your field, that ship won’t sail. Your prospective client will just move on to another freelancer who will agree to grant the company the option of leaving them hanging without compensation. Ah, the joys of working in the “gig economy.”

Since I wasn’t born with psychic ability, I’ve decided that the best gift I can receive this Christmas is a crystal ball that can offset my psychic shortcomings…or better yet, a winning mega-jackpot lottery ticket that would get me out from under the freelancer-client bus for good.

Uber is a German word that means above the rest. It is also the apt name of a popular mobile app transportation network company. For those of us trying to survive in the growing on-demand economy promoted by Uber, images of goose-stepping armies of gig economy fascists readily spring to mind. And my futurist crystal ball tells me that it’s in our best interest to stay out from under their technocratic jackboots.

Uber has attracted a lot of attention recently, both positive and negative, for proudly trying to redefine full-time employees as contractors.

Their business model isn’t new; Corporate America has been embracing transient labor in order to avoid paying employee benefits and related corporate taxes for some years now.

Unlike Uber, they don’t brag about it, though. After all, displacing full-time employees for contractors, many of them overseas or foreign nationals here on visas, still doesn’t play well in Peoria; just ask Disney.

No, Uber is proudly spinning its business model as one that entrepreneurial thought leaders are embracing in order to survive and thrive in our brave new world. What’s not to love? Their drivers are business partners, not employees.

Many millennials cheer Uber’s entrepreneurial passion, especially those who earn their bitcoins by sucking on a tech company’s teat. They feel we need to be free agents in order to innovate, or we deserve to disintegrate. How else can you become a mini-Zuckerberg and invent an app that Google, or even Zuckerberg himself, will buy from you for billions?

I admire their spunk, but as someone who’s navigated through a few boom and bust economies, this business model looks a lot like a sweat shop in silicon clothing.

We can’t be too surprised by the rise of the on-demand economy and companies like Uber (or Uberettes, as I like to call Uber-like startups). After all, we have become increasingly impatient consumers; millennials and boomers alike want instant results and gratification: we want a cab NOW; we want our Web-purchased goods NOW; we want everything NOW.

The more affluent among us don’t even mind Uber’s other ingenious invention, “surge pricing.” It’s not enough that Uber doesn’t want to pay for its drivers’ FICA, Medicare, workers’ comp and health insurance; no, they also favor a pricing plan designed to bleed as much money out of their customers as possible, even during terrorist attacks.

Surge pricing sticker shock isn’t for the faint of heart or wallet. Last Halloween, a Denver man was changed $539 for an 18-mile ride that typically costs around $40. Uber even spiked rates in Sydney, Australia when a local café was under siege last Christmas. Ho-ho-no! Stories like these pop up in the news every day.

Uber’s CEO, Travis Kalanick, defends his business model by saying that if he’s forced to provide employee benefits or charge reasonable cab fares, his company won’t survive.

What if all CEOs felt as Kalanick and collectively decided to make all U.S. workers 1099 contractors? A cab driver is one thing, but would you feel safe leaving your child at a day care center staffed by contractors who could come and go as they please without a background check?

And what role, if any, has our over-reliance on a transient labor force played in the recent rash of cyber security breaches? Is it unreasonable to think that an underpaid, often offshore, contractor would sell your personal info to supplement his or her income?

Wouldn’t an employee who has a vested financial interest in keeping their job be more reliable in handling your customer’s sensitive information? I guess it’s easier to publicly blame North Korea or China for all such breaches; gotta keep those admin costs down and the shareholders happy, you know?

And then there are the other lifestyle perks that come with being part of the non-gig economy: credit. How many Uber drivers can qualify for a mortgage, a car loan, or even a credit card?

Banks aren’t adjusting their requirements to accommodate the on-demand economy. They still want evidence of secure employment and if you don’t have a steady (hopefully, fat) paycheck deposited biweekly into your account, you won’t find a lot of love or credit at Wells Fargo or Citibank, even if you’ve been driving for Uber for years.

If we allow Uber and its ilk to shift the labor force Overton Window and acclimate us to being part of an on-demand workforce, we’re building a seamless bridge to an even more dire reality: robots and AI (artificial intelligence).

Uber’s Kalanick admitted last year that he can’t wait to dump his “business partner” drivers as soon as driverless cars are more reliable.

He’s not alone. Notice how companies worldwide are gradually introducing robots into the workforce? Lowe’s publicly tested a multilingual sales assistant robot last year and a five-star hotel staffed entirely by robots just opened in Japan. All hail the coming technocracy!

The popular narrative is that AI is cool and robots are needed for jobs companies can’t fill with people (ironically enough, the latter narrative is similar to the one U.S.-based companies use to explain why they need to hire foreign nationals). That’s where this is heading folks: 1099 workers today, replaced by robots tomorrow.

The only hope we have of saving our earning power is through the power of the purse. Support companies that support their employees and don’t patronize any humanity-hating businesses that replace full-time employees with cheap labor or R2D2. In doing so, you may just save your future employment prospects.

Tag: contractors

American Workers are Less Productive: No Job Security, No Motivation

American Workers Thrown Under the Omnibus Spending Bill

Psychic Ability: The Best Skill a Freelancer Can Have

Uber’s On-Demand Economy and the Decline of the U.S. Worker