Post COVID U.S. Economy: Employees Actually Have Power?

As Americans grapple with unreasonable home prices, an increasing number of them are looking to leave their current job.

Respected pollster and research company Gallup found that 53% of those surveyed in their 2023 State of the Global Workforce Report say “now is a good time to find a job where they live,” 50% of currently employed workers say they “are watching for or actively seeking a new job” and 28% of U.S. employees “would recommend their organization as a great place to work.”

While undoubtedly concerning for employers, employees should find these statistics encouraging. If all was lost in the job market, then over half of Americans wouldn’t think they could find or attempt to find a better job. When house prices are this bad, the average worker needs something to look forward to.

At the risk of sounding like a Marxist, the advantages that employers have had in the labor market need to weaken.

Many employers enjoy a monopsonic advantage. No, not monopoly.

As Investopedia defines monopsony: “a market condition in which there is only one buyer, the monopsonist” and argues that “monopsonists are common in which they supply all or most of the region’s jobs.

In a general sense, many employers wield monopsonic power over their employees. Consider the following data:

As Pew Research documented in 2018, “real wages for most Americans have barely budged in decades.”

For their 2023 July/August issue, Harvard Magazine stated that “before turning 30, nearly one-third of Americans will work at the same firm as a parent. In those jobs, these young adults earn almost 20 percent more than they otherwise would.”

Financial services company Nasdaq uncovered in 2022 that “55% of employees have experienced discrimination in their current job.”

In essence, we American workers have endured a market in which real wages have not increase for most, a relative of upper management or the owner gets the job and it’s fairly likely we will experience discrimination.

Is it at all surprising half of us want to switch jobs?

The so-called “Great Resignation” continues on in a different form. Employers have pushed back at some employee gains, to be sure. The “Return to the office” movement has some prominent supporters, such as Disney. Jobs are not as plentiful as they were in the pandemic and generous unemployment benefits have largely ceased.

Nevertheless, you can’t put the genie back into the bottle, as the saying goes. The 900,000 who left the workforce during the pandemic due to health issues, lifestyle changes or retirement aren’t coming back. People are having fewer children. Immigration has slowed since the pandemic.

To me, the effects of COVID on the economy are similar to those of the Black Death from 1347–1350. Once a third of Europe was dead, there was a severe labor shortage. Naturally, its effects have been debated, but many scholars use the same phrases to describe it: “wages rose, inequality decreased, feudalism ended.”

After a hellish couple of years confined to our homes, and several generations of an imbalanced labor market, it’s time the employees were in control.

Agree?