Month: December 2021

Two Emails from Famous Authors

I was struck by the coincidence of receiving thematically related email posts from Seth Godin and Ryan Holiday on the same day.  Both (excerpts below) remind that gratification in life, both personal and in business, won’t be about money.

Ryan Holiday – “It is Seneca who writes most eloquently of this desire, this insatiability we all have. Alexander the Great, he notes, was poor, despite his conquests of most of the known world. Because he could only think of the next campaign. He notes that money rarely makes us rich because all it does is give us a craving to earn more.”

Seth Godin – “After a stock market adjustment, billionaires give less to charity. They still have more money than they can count, but they’re not as rich as they used to be, and not-as-rich is easy to interpret as not rich.  Which means that for many people, feeling rich is a choice.”

Good reminder during the holiday season to seek happiness more deeply with family, friends, team members, customers, and community.

So, Why is There a Worker Shortage?

Speaking with over 100 Colorado business leaders in 2021, the most puzzling challenge they deal with is the shortage of workers.  Common refrains: “I don’t get it – where ARE THEY?  Where did they GO?”

I was curious so I read, pondered, listened… and I’ve developed a theory:

Six forces we’ve all been hearing about have in aggregate and in varying markets, caused a shortage across the economy:

  • Older worker exits. Covid-related job stress and complexities combined with either or both of a) getting used to not working and/or b) strong financial portfolio performance.
  • Young investors who don’t need a job. Who was buying crypto before Covid?  Younger workers tossed in a few hundred or a few thousand dollars now worth hundreds of thousands, even millions of dollars.  Why work a J-O-B?
  • Working not worth it for lower wage earners. Compounding real challenges including securing affordable daycare, reduced mass transit schedules, less affordable housing options within a reasonable commute all make working less attractive, perhaps particularly for a 2-worker household where only one returns.
  • Government payments. Daniel Henninger of the WSJ writes that “transfer payments suppressed work-response patterns across labor markets.” That’s what I hear from employers too.
  • Shift to self-employment. The Wall Street Journal on Nov 30th reported that self-employment rose 500,000 since the start of the pandemic.  Of course, some of the self-employed still have regular jobs… still, that’s a lot of people trying not to be an employee.
  • Competition in high-demand sectors. Heightened need for nurses during Covid, Amazon and others hiring over one million logistics workers, the tech industry trying to hire tens of thousands in areas like security and cloud technology.

I’m not an economist, and I don’t know to what extent each contributes to the shortage in different sectors, or how long the shortages will last.  So, what are leaders doing?  Right now, their answer starts with paying more and we’re seeing wage inflation broadly reported. As Ray Dalio says in his newest book, Principles for Dealing with The Changing World Order, “…what you are reading is a work in progress.”

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