A postcard from... the US

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Our 'postcard from' series keeps your updated on key HR areas in different countries

Economic briefing

Despite being surpassed by China as the largest economy in the world in terms of purchasing power, the US remains the largest in nominal terms. Growth since the recession has been slow and prone to ups and downs. Some sectors such as healthcare and finance are buoyant, while others like energy and manufacturing are struggling.

Demographics

The US suffers from a historic two-tier labour market in which those at the bottom lack the education and the professional/technical skills of those at the top, and fail to get comparable pay raises and health insurance coverage as a result. Since 1975 practically all gains in household income have gone to the top 20%. It also has an ageing workforce, which contributes to significant labour shortages in a wide range of sectors. Unemployment has fallen to just 4%, and time to fill a job is near its highest in at least 16 years.

Legal lowdown

“The US has a dizzying array of federal employment laws – separate from the multitude of statutes adopted by its 50 states,” reports Brian Barger, a partner at McGuireWoods. Examples include the Family and Medical Leave Act, which requires employers to provide up to 12 weeks of unpaid leave for childbirth, adoption or foster care, for leave related to a family member’s military service, or if the employee has a serious health condition or needs to care for a dependent with one. There are also laws that oblige businesses with federal government contracts or subcontracts to engage in ‘affirmative’ outreach activities.

The US’ renowned ‘hire and fire’ culture was one of the first things group HR director at SIGplc Linda Kennedy-McCarthy noticed. “People are often employed ‘at will’, i.e. they are not protected from dismissal by their contract. In many cases there is no written contract at all,” she reports. “This can mean managers have a shorter-term view when it comes to developing talent.”

Employee benefits

“The other thing that really surprised me is the amount of holiday Americans have,” adds Kennedy-McCarthy. “As there is no legal requirement to provide holidays the typical American worker would get two or maximum three weeks off per year, and even then they are often not able to take more than one week at a time.”

From the HR frontline

Kennedy-McCarthy reports that the US has a fantastic ‘can do’ work ethic, especially around customer service. “The majority of managers tend to empower people to make decisions and not micromanage,” she says, adding that: “Corporate social responsibility is also taken very seriously in the US and many companies give employees time to take on a variety of social projects in their local communities.”

Fact file

Area: 9,833,517 square kilometres
Population: 321,368,864
Average age: 37.8 years
Life expectancy: 79.7 years
Main languages: English, Spanish
Unemployment rate: 4%
GDP per capita: $54,800
Main industries: Aerospace, computers, medical, military equipment, pharmaceuticals