We are living in an age of extremes, a time when an hourglass economy defines the way we earn our money, as much as how we spend it. However, this is about far more than a passing phase in the economic cycle. We are witnessing an unprecedented stratification of society. The workforce is dividing into two tiers: one small group, which seems to matter a lot to those running business and the other, a disposable workforce, which doesn’t seem to matter much at all.
In this two-tier world, one group is regarded as top talent and the other is increasingly consigned to insecure zero-hours or agency-style contracts. In one tier, CEOs and bankers see their pay touching the stratosphere; in the other incomes have stalled.
Many feel this situation is the result of inevitable market forces. I suggest it is the result of conscious choices made by the leaders of our largest organisations and institutions. Now is an appropriate time to re-evaluate whether the choices we have made are working, sustainable and ‘right’.
First: Is it working? Is it producing the talent we need to grow our businesses, is it providing the skills required to build a successful economy? The answer seems to be no. Skills gaps continue to put British manufacturing under huge pressure. Surveys show CEOs of our biggest companies rank ‘lack of talent’, as one of their top risks to future growth. However, this isn’t just about skills. Productivity levels languish below pre-crash levels and engagement studies show that the workforce is now less committed than ever.
Secondly, is it sustainable? Again the hard data indicates that the two-tier workforce is having a damaging long-term effect on people’s lives. We know that there is a growing stress epidemic in the UK. What is perhaps less well-known is that stress levels for those in insecure employment are four times higher than those in top jobs. This blight on people’s lives plays into social mobility statistics, which show how a once thriving society is stagnating, and poverty statistics that highlight how people become trapped in poverty cycles.
Finally, is having a stratified workforce ‘right’? Is it for the greater good of society? Does it see individual workers, not as resources to be deployed or assets to be maximised or even as talent to be unlocked, but instead as people to be valued and respected as fellow human beings? This is potentially having a wider and more corrosive effect on society as a whole, as we expect to be able to treat others in a different way to how we would want to be treated ourselves. Under these circumstances the bonds between people break down.
Given this examination, why do so many companies seem intent on embracing a two-tier workforce? The answer it seems is that it offers greater flexibility, and that this has been essential in enabling responsiveness and short-term cost management.
Can these business practices secure long-term sustainable performance and underpin a society that works for everyone? The answer seems to be no. Isn’t it time for a re-think, to ditch the notion of a two-tier world and instead to work out how to reconnect with the entire workforce, and start acting in the interests of all stakeholders?
Norman Pickavance is head of brand and culture at Grant Thornton. His book The Reconnected Leader is out now
