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Americans Don’t Care as Much About Work. And It Isn’t Just Gen Z.
Blame it largely on the pandemic, which weakened the hold the workplace held on people’s psyches
People still like their jobs. It’s just that other things are more important now.
By Greg IP, WSJ
March 9, 2024
By outward appearances, the labor market today looks much as it did before the pandemic. The unemployment rate is just as low, the share of adults in the labor force is just as high, and wages are growing at roughly the same pace after inflation.
But beneath the surface, the nature of labor has changed profoundly. Career and work aren’t nearly as central to the lives of Americans. They want more time for their families and themselves, and more flexibility about when, where and how they work.
The impact of this change can already be seen in both individual companies and the broader economy. It has led to a persistent shortage of workers, especially in jobs that seem less desirable because, for example, they require in-person work or fixed hours. That, in turn, has altered the bargaining position of employers and employees—forcing employers to adapt, not just by paying more but giving priority to quality of life in job offers.
To be sure, some of these changes arise from an exceptionally tight labor market. If unemployment rises, some of employees’ newfound leverage may evaporate.
But some will endure. Historically, the fruits of economic growth are split between capital and labor, with labor taking some of its share in the form of amenities: less hours, more benefits, safer, more-pleasant work conditions. Those amenities are increasingly central to the labor market of today, in what employees expect and what employers must offer.
The pandemic’s impact
Like the wars that previous generations lived through, the pandemic was a milestone in the evolution of the workplace, shaping both the lives and livelihoods of today’s generation.
First, Covid-19 affected the ability of millions to work, by killing or sickening them or forcing them out of the labor force to avoid the virus or care for family members. Second, it shifted tens of millions of workers from physical to virtual workplaces. Some felt free, and loved it; some felt isolated, and hated it. Some felt both. Either way, the effect was to weaken the hold jobs held on their psyches.
In 2017, 24% of respondents to a Pew survey said their job or occupation was very important to their identity. In 2021, just 17% did. Later surveys corroborate this finding.
It isn’t that people hate their jobs or bosses; overall job satisfaction remains pretty high. It is just that other things are more important, which manifests itself in a number of ways. Workers have become more willing to take vacation days they are owed, a sick day when they are sick, a mental-health day when they are stressed, and all the parental leave their (increasingly accommodating) employers offer.
Popular expressions like “quiet quitting” or “work your wage” capture these new attitudes, often directed at Generation Z—those born between the late 1990s and early 2010s. “They’re really annoying, especially in the workplace,” actress Jodie Foster told the Guardian. “They’re like, ‘Nah, I’m not feeling it today, I’m gonna come in at 10:30 a.m.’ ”
This isn’t really fair. Oldsters started complaining about entitled, unserious youth with Aristotle, and haven’t let up since. For another, Gen Z faces burdens their parents never did, such as the hassles of Covid. Many a young parent has been forced to stay home with a feverish toddler because of zero-tolerance policies at schools and daycares.
More important, this trend is hardly restricted to the young. Sen. John Fetterman (D., Pa.), aged 54, scandalized the world’s greatest deliberative body by showing up in hoodie and shorts.
Who is working less
Economist Yongseok Shin at Washington University in St. Louis and two colleagues found that labor supply dropped sharply after the pandemic through lower participation in the labor force, and those still in the labor force working less hours. Labor-force participation has now largely recovered, as have hours for women. Men, however, worked 30 hours less last year than in 2019, and the drop was concentrated among upper-income college graduates.
Shin has a theory why. These men, for the most part, are workaholics, working longer hours and drawing a bigger paycheck than most. Suddenly, remote work let them dial back without penalty.
“With the pandemic, you realize, ‘I’m getting burned out, I want better work-life balance,’ ” Shin said. “If you’re the only one trying to do this, you worry about being left out of promotions and bonuses. But with the common shock of the pandemic, if you realize everyone around is doing the same thing including your boss, you feel more comfortable about reducing hours, and restoring work-life balance.”
Employees first saw remote work as an exigency, then an amenity, and now a right. Some have quit rather than give it up. One bank chief recalls drafting countless memos ordering employees back to the office only to have them vetoed by the human-resources department.
Hard-to-fill jobs
Workers’ newfound discernment about whether and where they work leaves its imprint on the economy at large. In December, 5.4% of jobs were vacant and in January, 40% of small business had at least one unfilled opening—both numbers higher than any time before the pandemic.
In-person jobs with fixed shifts are especially hard to fill. In leisure and hospitality, nonmanagerial pay is up 8% relative to the private sector average since 2019, which can be seen as the premium paid to people who have to work in person at fixed times. The prevalence of remote work is apparent in the half-empty office towers that still dot downtowns.
Companies have, by and large, made their peace with remote work, while being frank about the trade-offs. In an interview with The Wall Street Journal in Davos in January, Christian Ulbrich, chief executive of property developer and manager JLL JLL -0.61%decrease; red down pointing triangle, said the company wants all workers to feel like they are part of a team no matter where they work. Nonetheless, he thinks physical presence is important in jobs where productivity isn’t easily measured. Early in his career, “I was allowed to sit next to my boss, listen in on his phone conversations—what I learned in that time was amazing.”
Conversely, if physical presence no longer matters, there’s a stronger case for outsourcing the job altogether. “If you have a person working in finance who’s not coming to the office, why wouldn’t you hire that same person in India or in the Philippines?” Ulbrich said.
Earlier this year, United Parcel Service announced it was cutting 12,000 mostly management employees worldwide, and ordering the remainder back to the office five days a week. Expect more such unsentimental cost cutting in the coming year. The low layoffs of recent years were anomalous.
But the threat of layoff isn’t likely to elicit the submission from employees to managers’ demands that it once did. Many employees have concluded that some things are more important than their job, and will put up with a lot—including the threat of losing it—to have them.
Greg Ip is The Wall Street Journal’s chief economics commentator. Email him at greg.ip@wsj.com.
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