We Look At Who’s Hiring vs Who’s Firing (#GotBitcoin)
A slowdown in hiring in transportation and logistics sector follows strong expansion over previous year. We Look At Who’s Hiring vs Who’s Firing (#GotBitcoin)
Hiring at parcel-delivery firms plummeted in February as job growth slowed sharply across the broader U.S. economy, even as payrolls expanded in other logistics sectors.
Courier and messenger companies, made up mostly of the companies that deliver packages to homes and businesses, cut 9,700 jobs last month, according to preliminary figures the Labor Department released Friday. Warehouse operators and trucking companies added a combined 4,800 jobs from January to February.
The slide in parcel hiring was the steepest drop since January 2017 in a sector that includes United Parcel Service Inc. and FedEx Corp. Package carriers have added 53,100 jobs over the past 12 months, including 14,500 in January, as e-commerce growth led to more delivery demand.
“This was not a great month for couriers and messengers,” said Martha Gimbel, director of economic research at jobs website Indeed.com’s hiring lab.
Delivery-firm wages also have slipped, counter to the broader national trend. The average hourly wage in the courier and messenger sector was about $21 in January, the most recent data available by sector, compared with $22 a year earlier, Ms. Gimbel said.
The 2018 labor agreement between UPS and unionized workers in its main package division “should lower the effective hourly rate of marginal labor,” Bernstein Research analyst David Vernon wrote in a Friday research note.
Ms. Gimbel noted courier and messenger payrolls have grown by 8% in a year and that movements in hiring in specific industry sectors can be volatile from time to time.
“In the long view, growth has been quite strong,” Ms. Gimbel said. “One month should not cause people to panic, particularly when it was a month that was slow all around.”
Overall the U.S. economy added 20,000 jobs in February, far fewer than economists had expected. Goods-producing industries slashed payrolls by 32,000 jobs, potentially a signal of weaker output that would reduce demand for transportation and logistics services.
Construction payrolls shrank by 31,000, and retailers cut 6,100 positions. Manufacturing added 4,000 jobs, down from 21,000 in January, and factory output softened as cold weather in the Midwest caused transportation disruptions and closed factories.
Warehouse operators added 3,900 jobs last month, nearly a third of January’s postholiday hiring surge.
“There’s a real shortage of labor,” Hamid Moghadam, chief executive of industrial real estate giant Prologis Inc., said in an interview this week. The world’s largest owner of warehouses and distribution centers, the company is working with local workforce programs in Southern California and elsewhere to train high-school students for logistics jobs.
Distribution and storage companies are raising pay and other benefits as they compete with Amazon.com Inc. and others for staff while unemployment is hovering around its lowest in decades.
Trucking companies hired 900 workers in February, the 10th straight month of growth as carriers coming off one of the strongest freight markets in years continue adding capacity. Fleets ordered new trucks at a record clip last year, and have been raising pay to boost hiring.
Long-distance truckload employment added about 13,000 workers last year, “nearly double the number added in 2017, helped partly by a 4% increase in average hourly wages,” KeyBanc Capital Markets analyst Todd Fowler wrote in a Thursday research note. “In our view, industry employment trends are contributing to reduced driver attrition, further supporting incremental capacity near term.”
U.S. Employers Shed IT Jobs Amid Faltering Reopening Plans
Job postings in once-hot tech sector cool off as firms assess economic outlook.
U.S. employers shed roughly 134,000 information-technology jobs in July, according to IT trade group CompTIA, a signal that companies might be taking a wait-and-see approach as questions remain over everything from a new stimulus package to the return of in-person schooling amid the coronavirus pandemic.
July marked the first month of tech job declines since March, as employers across industries expanded net IT head count in April, May and June, according to CompTIA. While tech jobs remain among the most in-demand, some firms may be hesitant to fill openings as they assess how the economy develops, said Tim Herbert, CompTIA’s executive vice president for research and market intelligence.
“Perhaps they want to see how the stimulus package is going to play out,” Mr. Herbert said. “They want to see how states navigate school reopenings—a lot of those factors that they probably are hoping to get some clarity on before investing in additional hires.”
The results are based on an analysis of last week’s U.S. Labor Department data, which reported that 1.8 million new jobs were added in July, lowering the unemployment rate to 10.2% from 11.1% in June. The unemployment rate for tech jobs stood at 4.4% in July, up from 4.3% in June.
Roughly half of the nation’s 12 million technology workers are employed in the enterprise-tech sector, with the rest in IT-related jobs at companies spread across the economy. Together they represent roughly 8% of the U.S. workforce, according to CompTIA.
CompTIA’s analysis of tech-sector employment includes positions such as sales, marketing and operations, as well as core technology workers.
Tech-sector job cuts in July were driven in part by losses in the IT-and-software services segment, as well as the tech manufacturing sector, which produces hardware and other components, CompTIA said.
Across all sectors, job postings in IT fell to roughly 235,000 in July, down from nearly 269,000 in June and about 358,000 in March. The sectors with the most tech-job postings in July were professional and technical services with 39,956 postings, finance and insurance at 18,756, and manufacturing at 17,473.
“Professionals across the board are feeling the tightened market,” said Adam Lombardi, senior director of delivery transformation at staffing firm Kforce Inc., speaking about tech workers.
Despite the job losses in July, more than 500,000 IT jobs have been added so far this year, including a net 203,000 jobs from April to July—with tech jobs related to cybersecurity and e-commerce fueling many of the gains, CompTIA analysts said.
Graig Paglieri, the technology and engineering group president at staffing firm Randstad US, said the company’s clients have been beefing up their IT support staff job postings. “As many of us continue to work from home, there’s an increased burden on companies to provide sufficient technical support to their remote employees, which is why we’ve seen an increase in IT support roles by 16% in July.”
The CIA Fine-Tunes Its Hiring Pitch To Millennials And Gen Z
The agency has revamped its recruiting to attract younger workers who might be skeptical of its mission.
Recruitment was a clubby affair in the earliest years of the Central Intelligence Agency. The CIA, founded in 1947, scoured Ivy League campuses and elite East Coast social circles to find promising young men (and a handful of women) to fill out its ranks at home and abroad.
Today, the agency is turning to more public tools in a hiring push to expand and diversify its ranks. It runs video advertisements, has an Instagram account, and posts job openings on LinkedIn. It even launched a splashy new website in January whose content includes an advice column and dog-training tips, plus a bold new black-and-white logo.
The CIA hopes these efforts will convince the millions of millennials and Gen-Zers scrolling through their phones and streaming TV to consider a career in intelligence.
“We had to go where the talent is,” says Sheronda Dorsey, the CIA’s deputy associate director for talent, who is now on LinkedIn herself.
The agency has always relied on a steady influx of young people, especially recent college graduates, but has periodically faced challenges hiring them. Students frequently protested on-campus CIA recruiters in the 1960s, for instance.
Today’s CIA has its own obstacles. Polling shows that some millennials are more critical of past CIA actions and skeptical of the intelligence community’s role than older generations are. The agency faces hiring competition from the private sector. And today’s diffuse foreign policy arena presents no single mission to inspire recruits, like the focus on fighting al Qaeda after the 9/11 attacks.
The Catch-22 of the CIA’s hiring push is that while some of its controversial past actions are now public, its recruiters can’t tell candidates specifically what they do accomplish. CIA employees past and present, including Ms. Dorsey, speak instead with hushed reverence about “the mission,” a unique set of exciting and meaningful security issues that they get to work on.
Hiring today is less an issue of sheer numbers—its number of new hires in 2020 was the third-largest in a decade, Ms. Dorsey says—so much as attracting people of more diverse backgrounds. While there are no specific benchmarks, she says the agency hopes to increase racial, cultural, disability, sexual orientation and gender diversity so that its workforce is “reflective of America.” She adds that there are openings at all levels, including for midcareer professionals.
An internal demographic survey of those employed in the intelligence community, which comprises 17 bodies including the CIA, found that 26.5% of them were minorities in the fiscal year 2019.
Ms. Dorsey says STEM talent is a hiring priority. “We know that we have deep competition for talent in the STEM field, and especially where they can offer higher compensation packages,” she says. The agency uses the government’s standardized General Schedule pay scale.
A majority of Americans, 64%, gave the CIA a favorable rating in a Pew survey from 2018. But another 2018 survey by the University of Texas pointed to a generational divide: 78% of those born between 1928 and 1945 agreed that the intelligence community “plays a vital role in protecting the country,” versus only 47% of millennials.
Richard Solomon, a 24-year-old graduate of Indiana University who majored in international relations, says he once dreamed of becoming a spy and first learned Arabic with that in mind. But he became disillusioned by the post-9/11 War on Terror.
“This sexy image I had as a child, of undercover CIA agents kind of saving the world, slowly eroded and was replaced by knowledge of torture chambers,” he says, encapsulating some of his generation’s skepticism. He is applying to Ph.D. programs to study the political economy of the Middle East, but hopes to focus on agriculture, rather than topics with straightforward intelligence applications.
The CIA operated secret prisons known as black sites to detain and interrogate suspected terrorists after 9/11. The Senate Intelligence Committee said some of the interrogation techniques used there amounted to torture in a 2014 report. A 2014 Pew survey of 1,001 American adults found that 44% of those under 30 believed that the CIA’s post-9/11 interrogation practices were justified, versus 60% of those over 50.
The CIA declined to comment on the prisons. In 2014, then-director John Brennan declined to label any of the techniques as “torture,” but described some unauthorized interrogation methods as “abhorrent.”
Today, the CIA’s digital face-lift coincides with a new presidential administration. Mr. Brennan, whose directorship ended in 2017, says the Biden administration has sent out a “very strong signal on diversity” with its intelligence appointees, including the first-ever female director of national intelligence, Avril Haines.
Douglas London, who retired in 2019 after 34 years in the CIA, questions whether public outreach is the best way to increase diversity. Instead, he says, just as with past generations of elite hires, “You have to go and find them,” with more personalized overtures to, for instance, promising students of specific regions and languages.
Mr. London sat on CIA promotion and hiring panels throughout his career. He says getting hired was one thing, but continuing to work there as a minority could present challenges. He says that in the clandestine Directorate of Operations where he worked, there was resistance to matching nonwhite officers to certain assignments.
“It was not uncommon to hear an assertion like, ‘You can’t send a Black officer to Paris or Riyadh,’ whereas there was no hesitation assigning a white officer to Baghdad,” Mr. London says. But he doesn’t believe these norms to be insurmountable obstacles and maintains that the CIA is a “sensational place to work.”
The CIA declined to respond to Mr. London’s comments.
Whoever decides to take up the CIA’s call for applications should prepare for a rigorous vetting process, which Ms. Dorsey says can take a year or longer. She assures anxious candidates: “We are looking for honest people, not perfect people.”
Some prospective applicants are already prepared for such scrutiny. “I’ve thought about vetting and security clearances my entire life,” says 20-year-old Lauren Wadas, a junior at Brigham Young University-Idaho who is interested in working at the CIA. She keeps separate personal and professional Twitter accounts, and uses Facebook “only for church and my grandparents.”
The CIA has advice for people like Ms. Wadas on its website: “For your security, if you are interested in or have applied for a job at CIA, do not follow us on social media.”
Oilfield Jobs Tank Again In U.S. After Brief Recovery Last Year
The hired hands of America’s oil patch have now lost all the job gains they made during a brief recovery last year, according to a trade group.
The companies that frack wells and make the equipment necessary to produce oil cut an estimated 12,321 jobs over a three-month stretch ending in February, according to an analysis of labor market data by the industry-funded Energy Workforce & Technology Council. That wiped out the 11,282 jobs added between September and November, when shale companies were beginning to climb back from history’s worst crude crash earlier in the year.
Nearly all of the large publicly traded shale explorers are continuing to hold the line and not boost output this year, in an effort to appease investors demanding greater returns. The U.S. rig count is still down by about half compared to the start of last year, according to Baker Hughes Co.
The job estimates are preliminary and subject to revisions by the U.S. Bureau of Labor Statistics in future months.
Spotify Plans Hiring Spree In Bid To Challenge Clubhouse
After agreeing to buy Locker Room app, the streaming giant has big ambitions for Clubhouse-style live audio.
Spotify Technology SA is planning a major push into live audio, hoping to corner the market on what it thinks could be its next big business.
The company aims to hire more than 100 people to work on the effort, and has begun talking to talent about exclusive shows, according to people familiar with the matter. The idea is to capitalize on a new market popularized by Discord and Clubhouse, which let users participate in live audio chats — a 21st century version of call-in radio shows.
Just last month, Spotify announced it was buying Betty Labs, the owner of the Locker Room app, which sports journalists and fans use to discuss major games after they happen. Spotify is already talking to hosts of its in-house podcasts about developing ideas for the new version of the app, according to the people, who asked not to be identified because the plans are still being formulated. Spotify expects to pay some talent several hundred thousand dollars to host shows.
The Swedish company already operates the largest on-demand music service in the world and is trying to dominate all aspects of online audio. It has spent more than $1 billion buying podcasting companies and adding more than 2 million podcasts to its platform, hoping the shows will bring in new customers and fuel its advertising sales. Spotify has also added audiobooks.
Unlike podcasts, services like Locker Room or Clubhouse are participatory and live. Locker Room hosts can invite listeners onto the virtual stage to pose a question or discuss a new idea.
While it’s still not clear how big the business for these live-audio apps will be, Spotify doesn’t want to risk missing out on a potentially major shift in the industry. Clubhouse, which gained an early reputation for hosting conversations about tech and investing, just raised money to fund its social audio app at a valuation of $4 billion.
Spotify’s top podcasting executives, including Courtney Holt, Max Cutler and Bill Simmons, are overseeing the programming for live audio. Cutler founded Parcast, a podcasting studio Spotify acquired in 2019, and he’s now also in charge of audiobooks. Cutler has begun talking about ideas with producers and hosts — both inside and outside the company. In one scenario, hosts of pop-culture podcasts could stage live chats after new episodes of a popular series, the people said.
Another option is for sports podcasters to talk live after a major sporting event. Simmons, host of one of the most popular sports podcasts, used Locker Room after rounds in the Masters golf tournament. Simmons, like Cutler, sold a company he founded to Spotify. Both Cutler and Simmons declined to comment on their plans.
Though Locker Room is devoted to sports, the revamped app will branch out into pop culture and music. The development of the new service is being led by Gustav Soderstrom, Spotify’s head of research and development. Soderstrom suggested musicians might use the app to offer the modern version of liner notes on an album.
“Interactivity and live is something our creators have been asking us for for a long time,” he said in an interview when Spotify announced the Locker Room acquisition. “Were trying to facilitate interactivity between creators and fans.”
The company is racing to get a version of the app that works on Android phones — something Clubhouse has yet to do. The growth of Clubhouse has slowed at a time when many of the largest technology companies, including Facebook and Twitter, are pushing into its market.
But Spotify may have an edge. Unlike Facebook or Twitter, which don’t have much of an audio business at the moment, Spotify is already the top audio service.
Musk Doubles Hiring Goal To 10,000 at Tesla’s Austin Factory
Elon Musk can’t stop tweeting about all the jobs he’s bringing to Texas.
Tesla Inc.’s new factory in Austin will need 10,000 hires through 2022, double the previous pronouncement, Musk said Wednesday on Twitter. The tweet came less than an hour before President Joe Biden is slated to lay out his infrastructure plan, in which clean energy and new jobs will be a big focus.
Musk is rapidly expanding his Texas footprint. The new hiring goal in Austin represents a big step up from June, when Tesla told local officials that the factory would bring 5,000 “middle-skill” jobs to Travis County, with positions that pay solid wages without requiring substantial higher education. And this week, Musk issued a public invitation to engineers interested in working for Space Exploration Technologies Corp., his rocket maker, in South Texas.
Over 10,000 people are needed for Giga Texas just through 2022!— Elon Musk (@elonmusk) March 31, 2021
– 5 mins from airport
-15 mins from downtown
– Right on Colorado river https://t.co/w454iXedxB
The Austin plant will produce the forthcoming electric Cybertruck and Model Y crossovers for customers on the East Coast. Texas is the third most popular state for Tesla vehicles, after California and Florida.
Drone footage of the Austin plant shows that construction is moving quickly. The challenge for Tesla in 2021 is one of global expansion amid increased competition as legacy automakers play catch-up with regard to electric vehicles.
Summer Jobs For Teens Make A Comeback—But Not All Types
It’s easy to find a gig as a lifeguard. Demand is high for work in child care and food service, too. But teens and young adults are finding more competition for paid internships.
Mayson VanMeter hoped to switch gears from her cashier jobs to find a more career-oriented internship in human resources this summer, after her freshman year in college—but she hit a wall.
“It’s kind of hard to find a paid internship, honestly,” says the 19-year-old University of Southern Indiana student. She has been applying online to numerous posts listed on LinkedIn and Google, but hasn’t heard back from anyone yet. She is vaccinated and open to in-person work. But with her school year ended, she feels like the kind of summer experience she wants may not be in the cards.
“If I can’t find an internship, then I’ll probably stay here at Rural King,” she says of the farm-supply store chain where she’s worked since January. She is paying her way through college and says some income is essential.
This year is shaping up as a boom year for summer jobs for young people, but it’s an uneven spread. Industries that traditionally hire teenagers, like hospitality and retail, are rapidly expanding again. Millions of young adults have been vaccinated against Covid-19, making them more comfortable than they were last year with high-contact, in-person jobs. And many teenagers, who suffered some of the biggest job losses in 2020, really need the money.
But for those interested in more white-collar work like paid internships and research gigs, it can still be competitive. Short-term positions are often not critical to running a business, so there are fewer of them available in many fields than there were before the pandemic, says AnnElizabeth Konkel, a Washington, D.C.-based economist with the Indeed Hiring Lab, a research arm of the jobs website Indeed.
Youth summer employment has been trending downward since the 1970s, according to monthly data collected by the Bureau of Labor Statistics. In July 1978, 71.8% of workers aged 16 to 19 participated in the labor force. In the 2010s, that number never topped 45%.
It’s not just that employer demand for young workers dried up, says Andrew Challenger, a senior vice president at Challenger, Gray & Christmas, an executive coaching firm. Some modern teenagers also have incentives to spend their summers on unpaid activities like volunteering and sports, especially with college admissions in mind.
He believes that this year’s post-lockdown summer may buck that longstanding trend, because more teenagers typically want jobs when the labor market does better. His firm estimates that U.S. teens will add two million new jobs this summer. “All the industries where teens traditionally find jobs, like small retail businesses, restaurants and entertainment, are preparing for a huge surge,” he says.
Many of those old-school, paid summer jobs are finding it tough to hire enough young people. “We’re facing a camp counselor and lifeguard shortage this summer,” says Tom Rosenberg, CEO of the American Camp Association, a nonprofit. The talent pool for hiring camp staff, mainly 18- to 25-year-olds, has been challenged by disrupted school schedules, he says. “U.S. camp workers are less available this year than at any other time in the last 50 years.”
“We are ready to hire just about anybody who walks in the door at this point,” says Bill Bumbernick, owner of the Surfing Pig restaurant in North Wildwood, N.J., on the Jersey Shore. He says that young people ages 18 to 25 comprise most of his front-of-the-house staff, like waiters and busboys.
The demand for babysitting, another summer job mainstay for young people, is picking up fast this spring after a pandemic-induced slowdown last year, says Rachel Charlupski, Miami-based owner of the Babysitting Co. The company has about 2,500 sitters on its payroll this year. “This year is probably 200% more busy than in 2019—it’s unbelievable,” she says.
While there are plenty of openings for teens in these bread-and-butter fields, other kinds of summer work, like professional internships and research positions, can still feel competitive today, according to young people who have applied for them.
There are relatively fewer internship postings this year than last year, according to data posted by Indeed in April. The fraction of internships as a share of overall postings on the website was 39% lower than in 2019 and 15% lower than in 2020. At the same time, applicants’ internship-related searches on the website were 38% higher in April 2021 than in April 2020.
Alexis Hatch, an 18-year-old freshman at the University of Chicago, wrote 72 cover letters last winter in hopes of getting a paid research role this summer. She was chastened by her experience cold-applying for summer jobs last fall on Handshake, the student jobs platform. She never heard back from a single one.
“So I had to go ballistic and nuclear with this cover letter thing,” she says. She eventually got and accepted a paid summer research position at the Ming Xu Laboratory at her university, where she will help test a novel skin stem-cell treatment for cocaine overdoses on mice.
As a prospective medical student, she felt it was crucial to spend her summer on research rather than a less academic job. Based on conversations with older students, she believes it was far more difficult this year than it was before the pandemic to find a paid research position.
Vaccines have opened up new frontiers for many summer jobs: Ms. Hatch, for instance, will be going into her lab in-person. Jamee McAdoo, a 19-year-old in Little Rock, Ark., will start next month as an in-person summer associate at her local library.
“I just got my second shot, so I’m excited to go in,” she says. It will mark a contrast from her classes at Jackson State University in Mississippi, which she has been attending remotely since March 2020. “I think it will be good for me not to be cooped up at home all day,” she says.
There’s still some uncertainty about the logistics of all kinds of summer jobs. Quinn Nelson, an 18-year-old high school senior in Oakland, Calif., hopes to work again as a sailing instructor this summer, but is still not sure when or if it will happen. “Typically, they email staff about the dates for sailing sessions by now, but we’re still waiting on that,” she says.
That being said, she’s in no rush to figure out the specifics.
“The way I see it, it’s just something to fill up my day and keep me busy after graduation,” she says. “All my friends and I are really trying to take a break now. We’re so burned out from this school year.”
Hire Black And Latinx Tech Talent From These Overlooked Cities
Companies recruiting in STEM fields need to look beyond Atlanta and Miami.
After last summer’s racial justice protests, numerous tech companies promised to hire, retain and promote more from the Black community. Now another summer is upon us and not much has changed. The industry has a track record of insufficient action on diversity despite consistent promises.
How can tech CEOs do better? Let’s begin first with a major roadblock: the extreme geographic concentration of the industry and its workforce. Seventy-five percent of venture capital funding — which is mostly in tech — has been captured by New York, California, and Massachusetts, with the focus heavily on the tech superclusters of the San Francisco Bay Area, Boston, New York and Seattle. Ironic, indeed, for the industry that is meant to be the de-concentrator and the killer of distance.
In an industry that experiences fast growth and a perennial war for talent, hiring managers tend to be both risk-averse and expedient: They hire from the same places, often close to these hubs, because it’s harder to spot and recruit talent from a distance.
But a firm based in Boston or Seattle is going to run into the reality that less than 2% of the Black workforce lives in Massachusetts and less than 1% lives in Washington state. Almost 60% of the Black labor force lives in the South.
The pandemic could have made long-distance recruiting easier. Remote work could have opened possibilities for hiring managers to cast a much wider net. It hasn’t so far — but the remote working window is still open.
Many tech companies have extended flexible working policies for the post-pandemic era. Some, such as Facebook, have pledged to let their employees continue remote work indefinitely.
So, where to look? Atlanta, with a majority Black population, has emerged as the go-to city for Black talent, with Google, Microsoft, among others setting up satellite offices there.
It ranked 10th in tech employment nationally, and is a hub of Black tech entrepreneurship, and is home to several excellent academic centers, including Georgia Tech and Emory University, as well as Morehouse and Spelman, two preeminent HBCUs. Then there’s Miami, with its majority Latinx population, which became the top destination for remote workers last year.
But although Atlanta and Miami offer some of the largest and most diverse STEM talent pools of all U.S. cities, both are already well above the median in cost of living. Neither is “under the radar” any longer.
Based on an analysis by my Digital Planet team at the Fletcher School at Tufts, there are several other cities recruiters should be looking in for Black and Latinx graduates with STEM backgrounds. All have relatively high rates of STEM graduates of color as a share of the population.
Five metro areas with deep benches of Black and Latinx STEM talent are Washington, Houston, Chicago, Dallas-Ft. Worth and Philadelphia. For Black talent specifically, recruiters could add Baltimore, Raleigh-Durham, Charlotte, Detroit, and Norfolk. And for Latinx talent, recruiters should add San Antonio, Phoenix, Orlando, Austin and Denver.
It’s not just a matter of which city has the most candidates, though. Recruiters will also care about how easy it is for those new hires to log on to video calls, upload their work, or download new assignments.
Washington, Baltimore, Philadelphia, Atlanta, Chicago and Detroit are already among the top 12 cities in the country in terms of median download speeds. But the cities in the South and Southwest do not have the same strengths in terms of digital infrastructure. In particular, cities such as Miami, Houston and Dallas-Ft. Worth would benefit from upgrading the accessibility of their high-speed internet.
According to a recently released report on the state of work-from-anywhere, internet connectivity problems are the biggest employee concern regarding remote work. Even if one can expect tech workers to have relatively better access or establish their own workarounds, note that the digital divide disproportionately affects households of color; for many companies, worries about reliable internet access for remote employees from such households could be a deterrent or an excuse to simply not recruit.
This factor seems to have escaped several governors and mayors offering incentives for remote workers to relocate. Consider the extreme examples of Shepherdstown, Lewisburg and Morgantown, three cities in West Virginia, where the governor is offering a $12,000 incentive to lure remote workers to the state. According to our analyses, West Virginia ranks 50th out of 50 states in digital infrastructure.
While slow internet is often perceived as a rural problem, 62% of urban West Virginia does not use the internet at broadband speeds. And in fact, across the U.S., urban households are three times less likely to have a broadband subscription than their rural counterparts. This is a serious deterrent to companies that would like to search for talent in a more diverse array of cities.
Hiring managers in tech companies need to become less risk averse and extend beyond the traditional source cities and target schools for recruiting fresh talent. And cities need to upgrade their digital infrastructure so that they can benefit from the boom in remote work.
Many hiring managers may agree with the Wells Fargo CEO’s misguided comment last fall that talent from under-represented populations is hard to find, especially for those with a STEM background. That simply isn’t true — if you know where to look. If tech companies start looking in some different places, we could be having a different conversation next summer.
Hiring And Wage Growth Are The Strongest For Restaurant, Hotel And Retail Jobs, Reflecting Consumers’ Desire To Get Out
A fading pandemic and heating U.S. economy appear to be paying off for lower-wage workers.
New jobs at restaurants, hotels, stores, salons and similar in-person roles accounted for about half of all payroll gains in June, according to the Labor Department. And workers in those industries are seeing larger raises than other employees.
“Americans are becoming more mobile and dining out more,” said Jim Baird, chief investment officer at Plante Moran Financial Advisors. “Retailers and restaurants are having to pay more to hire workers to meet that demand.”
Restaurants and other hospitality businesses added a seasonally adjusted 343,000 jobs in June, the department said Friday. Retailers added 67,000 jobs last month, including strong gains at clothing stores, indicating Americans are getting dressed up to go out and back to offices.
Similarly, personal-services businesses such as salons and dry cleaners added 29,000 jobs. Overall, employers added in 850,000 jobs last month, the best monthly gain since August 2020.
In the first six months of the year, the leisure and hospitality sector alone has accounted for nearly 50% of the 3.3 million jobs added in the U.S.
The rapid hiring reflects a renewed desire from consumers to travel, dine with friends and shop. It also suggests that constraints on the labor supply could be starting to ease.
Wages are rising and employers are offering hiring bonuses, including up to $1,500 to work at a fast-food restaurant, to attract workers. Meanwhile widespread availability of the Covid-19 vaccine is easing fears over contracting the virus.
Nearly half of states have withdrawn enhanced unemployment payments, which many Republicans and some economists said provided a disincentive to return to work, when recipients often received the equivalent of working full time at $15 an hour.
Average hourly wages for retail workers were up 8.6% in June from February 2020, before the pandemic took hold in the U.S. Wages for restaurants and other hospitality workers were up 7.9%.
Both gains are above both overall wage growth, at 6.6% in that period, and inflation. The average hourly wage in the hospitality sector was $18.23 an hour in June, and $21.92 in the retail sector, versus $30.40 for private-sector workers overall, according to Labor Department data.
“The food-service sector is out of control,” said Eugene Lupario, chief executive of SVS Group, a staffing firm based in Oakland, Calif. “Employers are willing to pay almost anything they need to get workers.”
He said starting restaurant wages are nearing $20 an hour in the San Francisco area, from around $15 an hour before the pandemic. Some clients are willing to take workers who have already completed an eight-hour shift at another business, and pay them overtime wages to do so, Mr. Lupario said.
“There is no shortage of opportunities, but we still have a lot of job seekers asking if they can get a customer-service job they can do from home, rather than return to a restaurant,” he said.
Better pay could be drawing workers into the labor market.
About 900,000 fewer Americans reported themselves as being prevented from looking for work due to the pandemic in June, versus May, according to the Labor Department.
And Friday’s report showed the number of people who became unemployed because they either voluntarily quit their jobs or re-entered the workforce rose by 300,000—a sign of confidence in the labor market—while the number who were unemployed due to job loss fell.
Also, the number of workers who said they hold part-time jobs but prefer full-time work declined by more than 600,000 last month.
“We’ve had this sustained run of wage increases particularly in lower-wage sectors,” said Robert Rosener, economist at Morgan Stanley & Co.
While wage gains are beneficial to workers, they have consequences for businesses and consumers. Businesses often attempt to pass along higher labor costs to customers by raising prices, which contributes to higher inflation. If companies can’t pass on all their costs, their profit margins will narrow.
The recent stronger hiring in low-wage fields brings them closer to fully recovering the jobs lost in March and April of last year.
The leisure and hospitality sector, including restaurants, still had 2.2 million fewer jobs in June than in February 2020, according to an analysis of Labor Department data. Retail employment was down more than 300,000 last month from its pre-pandemic level, though some categories, including nonstore retailers, like Amazon.com Inc., general merchandise stores, like Walmart Inc., and building-supply stores, like Home Depot Inc., employ more workers than they did at the start of last year.
Economists, including Mr. Rosener, expect further improvement in hiring.
“We should expect that this quickening pace of job growth will continue over the summer and into the fall,” he said.
At Amusement Parks, Pay Raises And Free Fries Get Teens To Work
Kennywood, like other amusement parks across the country, has increased pay and offered other perks to attract more workers.
Grant McCray was busy preparing trays of chicken fingers and french fries at Kennywood, an amusement park just outside Pittsburgh. It was pushing 90 degrees, but the 19-year-old said he didn’t mind.
Mr. McCray earns $15 an hour cooking for other young people who work at the park’s roller coasters, arcade games and gift shops. Earlier this year, he quit a $10-an-hour job at Chipotle when a friend told him he could earn a lot more at Kennywood, which raised pay for summer employees amid a severe worker shortage. Now he has money left over after splitting $750 a month in rent and utilities with a roommate, he said.
“It’s better than all my other jobs,” Mr. McCray said.
The pandemic dealt amusement parks a severe blow last year, and they have been working to staff up amid the reopening this summer, by increasing pay and handing out other perks—from free french fries to free family passes.
Amusement parks across the country have been forced to increase wages. Universal Studios Orlando increased its minimum pay across a range of positions to $15 an hour, up from $13 an hour for 18,000 employees.
Cedar Point, an amusement park in Sandusky, Ohio, doubled starting pay to $20 an hour, and it had to reduce its operating hours at the start of the season due a shortage of workers. And Splish Splash, a water park on Long Island, bumped pay up to $18 an hour.
It is a boon for teens seeking summer jobs. The share of U.S. teens who were employed stood at 33.2% in May, its highest point since 2008, according to Labor Department data. Meanwhile, the percentage of adults with jobs is still well below pre-pandemic levels.
Isabella Ladisic, 19, who told Mr. McCray about the pay increases at Kennywood, now works alongside him earning $15 an hour, up from $10 a year ago. She said she would use her summer earnings to help pay tuition at St. Vincent College in Latrobe, Pa., where she is studying biology.
Kennywood opened in 1899 along the Monongahela River, and its roller coasters rise above the trees across the river from a rusting U.S. Steel plant that has been puffing steam for almost as long. The amusement park’s black-and-gold Steel Curtain, opened in 2019, boasts the highest inversion in the world.
Officials at Kennywood’s owner, Palace Entertainment, which has 25 attractions in 10 states and in Australia, realized in the first quarter that the flood of people buying passes to Kennywood and a tightening labor market were going to require higher pay to attract enough summer employees, said John Reilly, the company’s chief operating officer.
“It’s a dynamic environment, and you have to be flexible,” said Mr. Reilly, who walked through the park on a recent morning as customers started pouring in. The company analyzed local wages for similar jobs in all of its markets. “We saw what the cost of not reacting quickly was,” he said.
The company increased pay rates at Kennywood, up to $15 an hour in many cases, and offered free french fries and cotton candy to anyone willing to drive out to a job fair and fill out an application. Workers who were hired in May each got four passes to the park for family members.
So far, the company has hired about 2,000 summer employees at Kennywood and two other parks, Sandcastle and Idlewild, more than it had anticipated in March, and it plans to keep hiring workers. For all of 2019, it hired 2,700 workers at the three parks.
The company is now planning to offer a retention bonus at Kennywood and 11 other properties, equal to $1.25 an hour worked, to employees who stay through the date they committed to when they were hired, said Nick Paradise, a spokesman for Palace Entertainment.
The pay increases are a plus for returning summer workers. “It’s the cherry on the top,” said Lamar Hill, 27, back for his seventh year. As a manager in games and retail, he works six days a week and earns $15 an hour, $1 more than the company paid for that position in the past.
On a recent day, Zach Koontz, 16, secured riders in their seats on the Phantom’s Revenge, a roller coaster that hits a dizzying 80 miles an hour. With a promotion to unit supervisor, he earns $14 an hour, a job that paid $9.75 an hour last year.
He also referred his sister Sydney Pivovarnik, 21, to a job interning in group sales. A mathematical economics major at Gettysburg College, she said she was attracted by the resume-building experience and the chance to earn $14 an hour, $3 more than the company paid last year for the position.
“I feel like $14 is a pretty decent wage for a starting office job,” she said. “I save everything I can.”
U.S. Job Openings Rise To Record, Underscore Hiring Difficulties
U.S. job openings rose to a fresh record high in May, underscoring persistent hiring difficulties and reflecting more vacancies in the health care, education and hospitality industries.
The number of available positions climbed to 9.21 million during the month from a downwardly revised 9.19 million in April, the Labor Department’s Job Openings and Labor Turnover Survey, or JOLTS, showed Wednesday.
The availability of vaccines paired with a broader reopening of the economy has spurred a snapback in economic activity in recent months, but consumer demand has largely outpaced businesses’ ability to hire. In a race to increase headcount, many businesses have begun raising wages and offering incentives like hiring bonuses to attract applicants.
The number of people who voluntarily left their jobs decreased to a still-lofty 3.6 million in May, as the quits rate dropped to 2.5%. Quits fell in nearly all industries, though they picked up slightly for restaurants and hotels.
At the same time, the figures highlight an elevated number of Americans quitting their jobs to search out new opportunities. Whether seeking more flexible hours, increased pay or the ability to work remotely, the number of quits suggests workers are confident in their ability to find other employment.
The enigma of a worker shortage at a time when millions of Americans remain out of work likely reflects a myriad of factors including child care challenges, lingering coronavirus concerns and expanded jobless benefits. Those factors will likely abate in the coming months though, supporting additional hiring.
Accommodation and food service job openings increased by 89,000 in May, and by 81,000 in health care. Hiring at restaurants and hotels remained robust.
Total hires decreased to 5.93 million in May from 6.01 million, while the hires rate eased to 4.1%. The decline was concentrated in construction, government and professional services.
The total number of vacancies exceeded hires by 3.28 million in May, the highest in records to 2000.
The latest jobs report showed payrolls increased 850,000 in June, the largest advance in 10 months, suggesting firms were having greater success a month later in recruiting workers to fill open positions. Still, other data underscore ongoing labor constraints.
The employment measures for the Institute for Supply Management’s manufacturing and services surveys both contracted in June. A separate report from the National Federation of Independent Business showed small business job openings eased slightly in June, but the reading was second only to the record seen a month earlier. And on June 25, job search website Indeed had 33.6% more job postings than the pre-pandemic baseline.
London Becomes Jobs Hot Spot As Finance And Consulting Hire
London’s jobs market has sprung back to life, becoming a hot spot for the first time since the pandemic closed vast sections of the economy, two separate surveys showed.
The Recruitment & Employment Confederation said London had six of the top 10 areas in the U.K. for new job postings in the week ending July 18. Consulting and financial firms were among the top companies seeking staff in the city, led by EY, Citigroup Inc., PwC and KPMG, a report by the job search website Indeed showed.
London has lagged the rest of the nation in generating jobs, dragged down by a trend toward remote working that kept people out of the capital and devastated hospitality and retail jobs that depend on footfall. The city’s revival adds to evidence of tightening in the national labor market that’s starting to push up wages, fanning concerns about inflation.
“There’s a real sense of employer confidence has returned,” said Kate Shoesmith, deputy chief executive officer of REC. “London’s jobs market is kicking into gear as the hospitality and retail sectors open and more people return to offices.”
REC counted 1.57 million active job postings across the U.K. About 194,000 were added in the last week, a pace that’s been stable since early June. Childminders, driving instructors, bricklayers and information technology staff saw the biggest jump in demand. Want advertisements dropped for teacher, butchers and vehicle cleaners.
The Bank of England is carefully watching signs of strain in the labor market as it considers whether to pare back stimulus measures it put in place in early 2020. As the government winds down a furlough support for wages of those whose workplaces were closed during the pandemic, unemployment is forecast by the central bank to tick higher.
Indeed said jobs in financial services, consulting and law are driving a hiring spree in London, pushing job postings 2% above their February 2020 levels. Food service, arts and entertainment positions also rose strongly from a year ago.
“It’s not just the hospitality industry hiring,” said Jack Kennedy, U.K. economist for Indeed. “Some of the capital’s biggest and best known professional and financial services institutions are leading the charge.”
New Job Posting Shows Amazon Seeking A Digital Currency And Blockchain Expert
The role signals a shift toward cryptocurrency which Amazon still doesn’t accept as payment.
Amazon is hiring a digital currency and blockchain product lead for its payments team, according to a new job listing. First reported by Insider, the ecommerce giant is looking for an “experienced product leader to develop Amazon’s Digital Currency and Blockchain strategy and product roadmap.” The listing, which Amazon has confirmed is legitimate, continues:
You will leverage your domain expertise in Blockchain, Distributed Ledger, Central Bank Digital Currencies and Cryptocurrency to develop the case for the capabilities which should be developed, drive overall vision and product strategy, and gain leadership buy-in and investment for new capabilities.
Amazon.com doesn’t accept cryptocurrency as payment, but a spokesperson told Insider that the company was “inspired by the innovation happening in the cryptocurrency space and are exploring what this could look like on Amazon.”
Amazon’s cloud division, Amazon Web Services (AWS) already has a managed blockchain service. But CEO Andy Jassy said in 2017 when he was head of the AWS division that the company was “watching” the space but that Amazon didn’t see “a lot of practical use cases for blockchain that are much broader than using a distributed ledger,” ZDNet reported at the time. That would appear to be changing if this new listing is any indication.
Apple posted a similar listing in May for a business development manager for “alternative payments,” and among the key qualifications for the role was five years of experience “working in or with alternative payment providers, such as digital wallets, BNPL, Fast Payments, cryptocurrency and etc.”
More Job Ads Disclose Wages As U.S. Employers Grow Desperate
A rising number of U.S. job listings are including wage ranges as employers compete for cooks, truck operators and other scarce workers.
The lack of transparency on pay has long been a scourge of job seekers, and recent data suggest that the tight labor market may be starting to force companies’ hands.
Around 12% of listings across all occupations offered salary information in the second quarter, up from 8% in the same period in 2019, according to analytics firm Emsi Burning Glass.
The biggest gains were in hard-to-find positions such as restaurant hosts and nurse practitioners, for which almost one in five ads now disclose pay, according to Burning Glass, which analyzes millions of offers for trends.
The number of offers disclosing wages remains a small minority, but the shift could embolden workers. President Joe Biden has called rising wages “a feature” of his economic plan, and in a recent CNN town hall event said the hospitality and tourism industries may be “in a bind for a while” as workers hold out for better wages and working conditions.
Employers historically have been reluctant to show their cards publicly, fearing that they’ll have to pay more than a job seeker is willing to accept, or that current employees will grouse about being underpaid.
However, some state legislators are trying to force the issue, arguing that women and minorities are more hesitant to negotiate with employers and fall behind their White male counterparts in pay.
The day when most employers are transparent about wages can’t come soon enough for Kristen Ware, a 22-year-old in Rock Hill, South Carolina, seeking a marketing job.
“I would like to know how much a company is going to pay me, because I don’t know how much a recent graduate should be getting paid,” said Ware, who complained about the lack of pay disclosures on a Facebook forum. ”We shouldn’t have to guess all the time what’s the best pay for me.”
A new law in Colorado requires that companies with any presence in the state post wage information in their job ads. That holds even for positions that can be done remotely from outside of Colorado, and the state’s Department of Labor and Employment has been following up on tips about companies that aren’t compliant.
Maryland and California also have laws requiring companies to provide wage ranges to job applicants upon request, and Connecticut will soon require companies to disclose wage ranges for open jobs to both applicants and existing employees.
“Colorado is nudging the country toward having a more informed labor market,” said Scott Moss, director of the division of labor standards and statistics at the Colorado labor department.
Burning Glass compared 2021 with prepandemic 2019 instead of last year to get a clearer picture of changes, and focused on employer-sponsored job sites, filtering out public job boards that sometimes include their own wage estimates.
The Rocky Mountain states, including Colorado, saw more than a 300% increase in job listings that include salaries, but the numbers grew in most other regions, too, the data show. The Great Lakes region rose 29%, the Mid East rose 35% and the Southeast and Southwest rose 54% and 61%, respectively. The Far West and New England were two regions that saw small declines.
Tim Dupree, president of staffing giant Kelly Services’ Professional and Industrial unit, chalks up some of the gains to “leakage” from Colorado.
Forced to disclose pay in that state, some employers are probably including the information in other states as well. Other companies are being very public with their wages to signal they’re no longer a low-paying operation, he said. As he drives around his Michigan base, Dupree sees warehouses and manufacturers touting their $17-an-hour wages out front.
“They’re probably using it as a way to drive messaging as an employer brand,” Dupree said. “Those former employers that were paying $9, $10, $11 an hour are now paying $15 or $16.”
There’s still a long way to go before full pay transparency in offers, and data from other sources provide mixed signals.
Adzuna, an international job board with a U.S. headquarters in Indianapolis, found that only 1.5% of ads across occupations included wage information in June, actually down slightly from two years earlier. However, the company did see big gains in competitive industries, including trade and construction, where the percentage of ads with wages has quadrupled since June 2019.
Unlike Burning Glass, Adzuna included ads from public job boards as well as from companies’ own websites.
Kimberly Harris, who runs career fairs around the country from her base in Charlotte, North Carolina, has been pushing her corporate clients to disclose wages.
“When we include pay ranges or pay rates, the responses would triple,” Harris said. “We want honesty and we want transparency.”
The Jobs Numbers: Who’s Hiring In America—and Who’s Not
U.S. employers added 943,000 jobs in July, and the nation’s unemployment rate fell to 5.4 percent, according to data released Friday by the Labor Department. Meanwhile, average hourly pay for workers rose 4 percent from a year earlier, to $30.54 from $29.37.
Leaders & Laggards
Below are the industries with the highest and lowest rates of employment growth for the most recent month. Additionally, monthly growth rates are shown for the prior year. The latest month’s figures are highlighted. Wage data are shown when available.
Connecting The Dots
Follow the dots in the chart below to see how shifts in employment have coincided with changes in average hourly pay from one month to the next. The greater the vertical distance between dots, the larger the change in wages; the greater the horizontal distance, the larger the change in total number of jobs.
Black Americans Leave Workforce, Driving Their Jobless Rate Down
Black Americans saw a sizable drop in unemployment in July, but the decrease came as workers left the labor force, an indication that the jobs recovery remains uneven.
The jobless rate for Black Americans fell to 8.2%, the lowest level since March of 2020, and down from 9.2% in June, according to figures released Friday by the Department of Labor. Black men in particular saw a large decline.
Behind the lower rates is a drop in participation for both Black men and women, as well as Latina women aged 20 and over. Most other major groups, including White Americans of both sexes and Hispanic men, saw an increase in the ranks of workers last month.
Monitoring the progress of minorities is key to assessing the economic recovery. The Federal Reserve has said that its maximum employment goal is “broad-based and inclusive,” and policy makers are looking at how different groups of Americans are rebounding from the pandemic crisis in considering future policy moves.
Overall, the unemployment gap between Whites and Blacks narrowed, but rates for both Blacks and Hispanics remain above the national rate, which was 5.4% in July.
The Asian American unemployment rate is below the national level, at 5.3%. However, Asian joblessness was the farthest from pre-pandemic rates among the demographics tracked by the Labor Department. The prime-age participation rate — people age 25 to 54 — reached a 12-year high in July for Asian Americans, the data also show.
Women saw improvements last month. The unemployment rate fell to 5.2% from 5.7% as the number of women in the labor force increased modestly and 649,000 more women became employed. The female labor force is still down nearly 1.7 million workers since the start of the pandemic, compared to a shortfall of 1.4 million men.
These Millennials Are Dumping Their Jobs to Plot New Careers
With several years in the workforce and some savings, some young professionals take an early career break to reassess and chart a different path.
They launched careers in the years after the 2007-09 recession and only recently hit their stride in earning power. Now some young professionals are quitting their jobs with no Plan B.
With several years in the workforce and some savings in the bank, they are taking a breather to learn new skills, network and develop their creative potential before locking into another career path.
These workers, now in their late 20s and early 30s, are both chastened by pandemic-era burnout and optimistic about a rebounding job market. While many of their peers are jumping immediately to better-paying or more well-suited jobs, they are leaning into an early-career break instead.
Tessa Raden, 33, was so burned out by remote work that she quit her dream job as a program director at the Dramatists Guild Foundation in July with no set backup plan. She says she goofed off for a couple of weeks, then picked up a bartending job, about five evening shifts a week, at Brookland’s Finest Bar & Kitchen in her Washington, D.C., neighborhood.
“I was just so tired of pushing, and I had totally lost my passion,” says Ms. Raden, who has a master’s degree in arts management. On paper, her job overseeing programming and supporting writers was everything she had worked toward in her adult life. But the pandemic eliminated live performances, a part of her job she loved, and she found it hard to focus and stay motivated once she traded the office for sitting at home on her computer.
“I love that I don’t have to take my work home with me,” she says of her new lifestyle. “And I love that the majority of my job now is just being friendly, not staring at a computer screen.”
Ms. Raden is using her free hours to complete a graduate certificate in education policy and hopes eventually to transition into public education. She notes she probably wouldn’t have been able to afford such a break in her less-flush 20s. But for now, she has enough savings to cover her rent, and bartending covers her other expenses. “I think I can hang on to this structure for a couple more months,” she says. “I’m trying to plan a little less.”
U.S. workers are quitting their jobs at some of the highest rates in years, a sign of great appetite for change and confidence in better prospects down the line. The share of people leaving jobs reached 2.7% in June, according to the Labor Department, just shy of April’s 2.8% rate, the highest level since the government began tracking quit rates two decades ago.
A Prudential Financial survey of 2,000 American workers this spring found that millennials—those between the ages of 25 and 40—were antsier than other generations to make a change: More than a third of that demographic said they planned to look for a new job post-pandemic, compared with about a quarter of workers overall.
Some of these workers don’t want to jump into another role until they find one more aligned with their long-term career goals.
“Earlier this year I was hoping to switch jobs and scrolling through tons of postings, but I eventually realized the only way I could make a successful career transition was to quit,” says 33-year-old Andrew Hibschman, who was a program lead and assistant professor at La Salle University in Philadelphia until he quit this month. “I didn’t have the time or energy to devote myself to the search the way I wanted to,” he says.
He started out mainly teaching English and, over the course of the decade, became more involved in admissions and other academic-support programs. But his longer-term goal is to work in education technology or learning development. To that end, he spends two-to-three hours a day taking online classes to brush up on topics such as diversity-and-inclusion programming, and at least another hour a day on networking and the job search.
“This is the first time since I was 14 that I don’t have a job, which is somewhat terrifying,” Mr. Hibschman says. “But I do feel optimistic because there are so many jobs out there.”
Getting married in May has eased the transition. In addition to lending emotional support, his husband also is working to get him onto his health insurance plan.
Figuring out health insurance can be one of the thorniest issues for those leaving a full-time job with benefits. Most options leave a lot to be desired, says Laura Briggs, a coach for freelance workers based in Springfield, Ill. Many join a partner’s plan if that’s in the cards, she says, and another option is a high-deductible plan with relatively low premiums that covers worst-case scenarios like surgeries and accidents.
Another short-term option is to use Cobra, a federal law that permits workers who leave their jobs to temporarily continue a former employer’s health benefits, though that can be expensive.
Ms. Briggs also suggests that those planning to leave a job with benefits meet with a financial adviser. “You should be proactive about figuring out how much you can and should set aside every month, especially if you no longer have employer-matching contributions to your retirement plan,” she says.
Evelyn Danciger, 27, says she is relying on several years of savings and looking into Cobra options as she transitions to full-time writing. She resigned in July from the Sid Lee creative agency, where she was a senior manager. She dreamed of becoming a writer since she was in third grade, she says, but fell into marketing after graduating from Loyola Marymount University in Los Angeles, where she majored in screenwriting, in 2016.
As she took on bigger projects at the firm, the time she usually set aside to write slowly disappeared. And the heavier workload left her “stress-crying” and feeling intense burnout.
“I wasn’t doing anything creative, and my job had turned into mostly client management,” she says.
Now that her days are free, she can write more, plus do more in-person networking in Los Angeles, where she lives.
“I’m so excited to call up my industry contacts and go out for lunch and coffee again,” she says. “I don’t have to cram it all into a weekend now.”
FedEx Ground Delivery Becomes A Road To Riches For Contractors
Thanks to the e-commerce boom, prices for the rights to handle packages within designated routes have soared 50% in three years.
The crowd was amped. Some 1,800 strong, they had traveled from across the country amid a raging coronavirus flare-up to assemble in a hotel ballroom in Nashville. The man they were cheering as he took the stage wasn’t a rock star, a preacher, or a politician. It was Spencer Patton, a bespectacled 35-year-old former hedge fund manager in a polo shirt and khakis.
Patton has carved out a niche doling out advice to entrepreneurs looking to make it big as contractors for FedEx Ground, the package-delivery service that’s been booming amid a surge in online shopping during the pandemic.
“This is like buying Apple at $1 a share—that’s what we’re doing here,” Patton told rapt attendees packed into the presidential chamber at the Gaylord Hotel. “We’re at the tip of the spear in an asset class that no one knows about.”
The unusual asset class Patton proselytizes about—contracts that give owners the right to operate FedEx Ground routes in specified areas for as long as three years—is red-hot these days. The owners collect a fee for each package their fleets drop off, but they’re entirely responsible for hiring drivers, buying trucks, and dealing with all the issues that come with running a small business.
Prices for routes have increased 50% from only a few years ago, but they still may bring returns of more than 20% a year. Patton predicts most contractors will see their sales double over the next three years. Meanwhile, the mom and pops that dominated the industry are selling out to a new class of investors looking for growth and higher returns.
Patton’s celebrity status stems from his deep knowledge of the business: He owns 250 routes across the country, and he estimates that his consulting company, Route Consultant, has brokered about 25% of all the FedEx Ground route transactions in the U.S. So the nation’s thousands of would-be delivery czars are eager to get Patton’s advice on everything, including how much to pay for routes, the latest safety standards, and the skills needed to operate in the urban gridlock of Chicago or the rural byways of Chugwater, Wyo.
Patton came to logistics stardom via a circuitous path. Growing up in Nashville, he got his first taste of trading stocks at age 10 at his dad’s urging and was dabbling in options by age 16. After graduating from Vanderbilt University in 2008, he joined a company in Nashville that bought struggling businesses and turned them around. Two years later he persuaded the partners there to kick in $2 million to back a hedge fund he’d started.
In 2013, Patton walked away from managing other people’s money to concentrate on his own business. He’d methodically studied different industries, including self-storage units and liquor stores, before settling on the then-obscure idea of buying FedEx Ground delivery routes.
Patton’s opportunity stemmed from a decision two decades earlier by FedEx Corp. founder Fred Smith to buy a small parcel company, which quickly became a growth engine and is now the crown jewel of his delivery empire.
Annual revenue has tripled over the past decade, to $30.5 billion, while sales at the company’s Express unit, which transports mostly by air and has its own fleet of drivers on the payroll, have increased about 60% during the same period, to $42 billion. Average profit margins at Ground over the last two decades have been more than twice those at the Express business.
Unlike the overnight service, which hires its drivers directly, Ground operates on short-term contracts with 5,600 small companies. That’s given it a lower cost structure than rival United Parcel Service Inc., which has a unionized workforce and pays the industry’s highest wages. A UPS driver with over four years on the job makes about $65,000 a year, not counting overtime, plus pension and health benefits.
Delivery driver pay at FedEx Ground depends on the independent contractor and the location; it can range from about $39,000 a year to $60,000 for a high-performing employee. This doesn’t count benefits, which most contractors don’t offer.
Eight years ago, when e-commerce was shifting into high gear, Patton began to build his own route operations, which now deliver FedEx packages in 10 states. Along the way he began building a consulting business for newbies or others looking for advice. Eventually he added deal brokering, truck leasing, driver training, and even a financing unit to round out his suite of services—comprising 26 entities in all.
Since 2019, FedEx Ground has overhauled operations to account for the boom in at-home shopping. Smith extended deliveries to seven days a week from five, updated routing software, and started accepting more large packages, and FedEx Ground began taking back small packages that previously were passed to the Postal Service for final delivery. Then the pandemic hit, and volume jumped 23%, to 3.1 billion packages last year.
The operational changes and accelerated growth at FedEx Ground have overwhelmed many contractors and spurred an unprecedented frenzy of route buying and selling, Patton says. Longtime FedEx contractors, many of whom started out driving their own truck and have since accumulated wealth along with more delivery routes, are selling as the value of their holdings rises.
“We are seeing a ton of old-school contractors who are … retiring, cashing out, and making great money,” Patton says. “The new people coming in are business savvy and capitalized, and they’re hungry to grow.”
Patton lures potential clients with a weekly webinar that teaches the basics about FedEx routes. Every week he also announces the location of FedEx routes up for grabs and offers his services to support sales or purchases. Patton now has 70 employees at Route Consultant after starting three years ago with only four.
Typically, entrepreneurs can buy 10 FedEx routes for about $1.25 million. Annual operating profit for the small-package-delivery businesses can range from 10% to as much as 25% of sales for a well-run operation, Patton says. Prices for individual routes are based on a multiple of operating cash flow, while the price paid per package depends on a route’s population density, typical number of stops per mile, and the types of packages usually delivered. Valuations have climbed to about 4.5 times operating cash flow, up from about 3 times only a few years ago as package delivery expands.
FedEx signs off on each new owner, but it doesn’t get involved when routes get bought or sold. The courier must take a hands-off approach to the contractors, known as independent service providers, to avoid lawsuits from drivers who otherwise might claim they really work for FedEx. Amazon.com Inc. is also using the contractor model, which wards off union organizers and keeps costs down, as the company builds its own delivery network.
Patton’s expo attracted those 1,800 people this year, with sponsors including vehicle outfits Ryder System Inc. and Isuzu Motors Ltd. That’s up from about 400 at the first expo in 2019 and about 750 in 2020. At such gatherings, Patton always begins his talks with disclaimers that he’s not a FedEx employee and doesn’t speak on behalf of the company and that FedEx doesn’t endorse his consulting business.
At this year’s event, after light banter and a soft sales pitch for Route Consultant, Patton revealed previously unannounced changes to safety training that FedEx Ground plans to roll out. Attendees furiously scribbled notes.
One of those in attendance in Nashville was Larry Murray. A marketing professional who before the pandemic helped organize tours and festivals including Willie Nelson’s Luck Reunion in Texas, he says he binge-watched Patton’s webinars for four days and then signed onto the consulting program in 2020 before buying nine FedEx routes this year in Belton, Texas. Patton’s team helped value the business and get Murray started.
“Every penny was worth it,” Murray says. “We would be in really bad shape if we hadn’t done that.” He aims to buy more routes within the next year. Patton has “laid out a great road map,” he says.
Sean Randall, a career banker who last worked at Citigroup Inc.’s wealth management unit, quit corporate America in 2020 to be his own boss. He’d invested in apartment buildings but said they’ve gotten too expensive to produce a decent return. After watching the webinars and podcasts, Randall hired Patton’s company as a consultant and bought FedEx routes in the Washington metro area in January 2020. “There’s a lot of opportunity,” Randall says. “Because of that growth, a lot of smaller operators are being forced out. It’s too much for them to handle.”
FedEx has contributed to the hot market for buying and selling routes by limiting contractors from handling too much of the volume at one FedEx hub. It typically tries to keep a single contractor at less than 10% of a hub’s total volume, lowering the risk in case an independent operator stumbles and FedEx has to find other contractors to pitch in to get the packages delivered.
Todd Smart, in Mansfield, Ohio, got his first delivery area from FedEx Ground in January 1999 on the condition that he would buy and drive a new vehicle. From that beginning, Smart now has amassed 70 routes and started a repair shop for his vehicles and others. He needs to pare back to comply with FedEx’s hub limits. “The expectation is that if I sell half of my business, I will still grow by double in three years,” Smart says.
The system works most of the time, but it does have its quirks. When an operator fails, FedEx calls on other contractors to pitch in and pays them an extra stipend per package to help get the emergency under control.
Some contractors keep contingency teams on hand to send to areas where help is needed. Jim McCarthy, who formed a business with his sons that’s amassed 120 routes in multiple states, has four teams with five members each that travel all over the U.S. to do contingency work, renting out a large house wherever they’re needed. The groups earn more per package, and if the routes ever become available, McCarthy’s business is likely to be in a good position to vie for them. “Spencer opened my eyes to a bigger picture,” he says. “He brings a big business perspective to a little business.”
Fidelity Wants To Add 9,000 Jobs by Year-End
Move to meet investing demand will boost company’s workforce to more than 60,000.
Fidelity Investments plans to hire another 9,000 employees this year to help its businesses keep pace with the surge in demand for stock-trading and other personal-investing services.
Fidelity’s hiring spree is its third in the past year, when millions of new investors flocked to brokerages like Fidelity, Charles Schwab Corp. and Robinhood Markets Inc. Including the latest push, Fidelity’s total workforce is expected to grow more than 22% this year, to over 60,000 employees.
Drawn to the market’s rally, individual investors have changed the fortunes of the brokerage industry. The no-commission stock trades and low-fee investment funds now offered by many firms have brought in plenty of new clients. They also have thinned money managers’ profit margins and forced them to compete on price. Traditional products, like stock- and bond-picking mutual funds, have been leaking client money.
It is a trade-off Fidelity and some of its peers are willing to make. As more transactions course through their platforms, the costs associated with processing each of them drops. These firms also are betting many of the new account-holders will eventually graduate to more-expensive offerings, including financial advice.
The conditions that captivated many new, younger investors last year have continued in 2021, straining the call centers, websites and trading platforms that respond to customers’ questions and process their transactions. The major U.S. stock indexes touched record highs last week, buoyed by news that regulators had given full approval for one of the Covid-19 vaccines and Congress pressed ahead on a $1 trillion infrastructure bill.
Fidelity ended the second quarter with $11.1 trillion in assets under administration, or what investors held in brokerage and retirement accounts on the firm’s platforms, and in its funds. The firm added 1.7 million new retail accounts in the 12-month period ended in June, including 697,000 opened by clients 35 years old or younger. Fidelity processed 2.6 million trades a day in the second quarter, up from 2.3 million in the same period a year earlier.
“Over the last 18 months we’ve seen unprecedented levels of engagement from our customers,” said Kirsten Kuykendoll, Fidelity’s head of talent acquisition. “That’s been driving the record number of customer-facing roles.”
Those jobs include employees who staff regional call centers, serve as financial advisers and manage relationships with the firm’s institutional clients. The new hires, along with buyout offers Fidelity extended to about 2,000 employees earlier this year, will shift a bigger percentage of the firm’s workforce to the front lines of those customer interactions.
Of the 16,000 hires Fidelity plans to make this year, some 79% will be for client-facing roles.
The Boston-based company opened regional call centers in Smithfield, R.I., and Durham, N.C., during the second quarter, bringing its total to eight.
Fidelity plans to allow employees to continue to work remotely at least part-time for the foreseeable future. The firm hasn’t required staff to get vaccinated before they return to offices, Ms. Kuykendoll said.
Fidelity also is beefing up its technology staff to support its existing businesses as well as new services.
Fidelity Digital Assets, which helps hedge funds and other institutional investors trade and store bitcoin, has nearly doubled its staff over the past 18 months. The firm also has started a private bitcoin investment fund and filed for regulatory approval to launch an exchange-traded fund that tracks the cryptocurrency.
In May, Fidelity unveiled plans to issue debit cards and investing accounts to teens whose parents or guardians are existing clients.
Fidelity said in October it planned to create 4,000 new positions, and it added another 4,000 in April. The firm’s workforce now totals 53,000 employees, up from 42,000 at the end of 2017.
U.S. Travel Nurses Are Being Offered As Much As $8,000 A Week
With the economy reopening and labor scarce, all kinds of U.S. workers have been getting pay raises. Some of the biggest are going to a group that’s on the frontline of the fight against Covid-19: travel nurses.
There are about 30,000 open positions for travel nurses nationwide, according to data from SimpliFi, a health-care staffing firm. That’s up some 30% from last winter’s peak, and still climbing. Salaries have jumped too, with rates as high as $8,000 a week advertised for a three-month assignment.
Demand for nurses has spiked multiple times during the 18 months of the pandemic, reaching new highs with the current spread of the delta variant. Meanwhile, the strain of dealing with the outbreak has led many nurses to quit the profession, and hospitals and other health-care providers are struggling to fill permanent positions –- leaving them more dependent on temporary employees.
Travel nurses — who aren’t attached to a single hospital and work on short-term contracts — traditionally make up about 3% or 4% of overall nursing staff, according to James Quick, president of SimpliFi. “It’s now in the 8% to 10% range,” he said. “That’s being driven by demand.”
Quick says that billing rates for travel nurses were up more than 40% in August from a year earlier, while for emergency-room specialists the jump was 60%. The states with the most openings for travel nurses are Florida (which has about one-sixth of the nation’s hospitalized Covid-19 patients), Texas and California.
Businesses that cater to this demand are making money. At AMN Healthcare Services Inc, the nation’s largest medical staffing firm, second-quarter revenue climbed more than 40% from a year earlier –- and the company said bookings of nurses in July were double the April-June level.
“We had another record high for average travelers on assignment,” Chief Executive Officer Susan Salka said on a call to investors. She said the pandemic has created both short-term and permanent shifts in the workforce that “increased our opportunity.”
Much of the demand is coming from emergency rooms. Six months ago, bookings for emergency-room specialists accounted for 5% of travel-nurse recruitment, according to SimpliFi. Now it’s more like 15%.
That’s not just because of the delta variant. There’s also a backlog of elective surgeries from earlier in the pandemic. It could take 18 months to clear it, according to Bart Valdez, chief executive of a group of health-care personnel companies that includes Fastaff Travel Nursing and U.S. Nursing.
“Folks are getting more comfortable going back to hospitals,” he said. “So hospitals are responding by scheduling more procedures.”
Natural disasters like Hurricane Ida, which hit Louisiana on Sunday, also tend to trigger strong demand for travel nurses, according to Kathy Kohnke, senior vice-president at Fastaff. She said her company already has a lot of staffers in New Orleans dealing with the pandemic, and expects the need for nurses there will increase “exponentially.”
“Typically during the arrival of a hurricane, hospitals discharge as many patients as possible,” Kohnke said. “Due to Covid, that wasn’t an option.”
While travel nurses are in many cases only a short-term fix for hospitals struggling with the pandemic, their role in the U.S. health-care system had been expanding for several years before that.
That’s partly because Americans are living more transient lives, according to Joel Tremblay, chief executive of health-care staffing firm Medical Solutions. He gives the example of so-called “snowbirds” who spend the winter in warmer southern states –- bringing a temporary influx of patients to hospitals there.
“It wouldn’t make sense for them to have permanent employees working year-round,” Tremblay said.
‘It’s Super Hard’
The pandemic has amplified those trends. The surge in patient numbers, and the difficulty retaining permanent staff, means demand for temporary travel nurses will likely stay strong into next year, industry executives say.
That will keep wages high, said Tim McKenzie, chief executive of Travel Nurse Across America. “It’s going to be a long time before pay rates really get back to what would have been traditionally normal.”
If the money nowadays is good, the work is extremely challenging — leading many employers of travel nurses to offer enhanced mental-health benefits as well as higher pay.
“I was in Lansing, Michigan and you’d have three people dead in just the first four hours of the shift,” said Lydia Mobley, a travel nurse with Fastaff. “Over the winter we ran out of body bags. It’s super hard, it’s mentally exhausting.”
Grover Nicodemus Street, whose book “Chasing the Surge” chronicles his experience as a travel nurse in a series of Covid-19 hotspots, says nurses everywhere are burned out. “They’re quitting the industry left and right.”
Walmart Will Add 20,000 Workers To Supply-Chain Operations This Year
The push to add permanent hires ahead of the holidays signals the growing role delivery and distribution play in retail competition.
Walmart Inc. is hiring 20,000 workers for its supply-chain operations ahead of the holidays, highlighting the growing role of distribution and delivery as the retailer competes with e-commerce giant Amazon.com Inc.
The new hires will be permanent positions aimed at supporting Walmart through the holiday surge and beyond, the retailer said Wednesday. The full- and part-time jobs range from order pickers, freight handlers and forklift operators to technician and management roles at more than 250 Walmart and Sam’s Club distribution and fulfillment centers and transportation offices.
The hiring comes as retailers and logistics operators are moving their peak-season preparations forward as they grapple with a tight labor market, congested shipping networks and surging supply-chain volatility.
Last year, Walmart brought on some 20,000 seasonal workers at e-commerce facilities, including pop-up online fulfillment sites, as the company and others fielded unprecedented digital sales demand during the first year of the coronavirus pandemic.
Walmart’s U.S. online sales growth slowed in the second quarter, rising 6% over the pandemic-fueled e-commerce sales seen during the same period in 2020 as consumers emerged from their homes and returned to in-store shopping. Comparable sales from U.S. stores and digital channels operating for at least 12 months rose 5.2% year-over-year in the latest quarter, when the company said it planned to add automation at dozens of regional distribution centers to help speed the movement of goods.
Walmart said the average wage for its supply-chain workers is $20.37 an hour. The company also is offering its field-based workers, including those in supply-chain operations, a $150 cash bonus for getting the Covid-19 vaccination. Walmart warehouse jobs pay at least $15 an hour, although pay rates vary depending on the role and the region. The company also is offering bonuses to many warehouse employees as it ramps up for the holidays.
Competition for workers has pushed up wages for distribution jobs as businesses rush to restock pandemic-depleted inventories and meet surging online demand. Warehousing and storage payrolls accounted for 1.44 million jobs in July, more than half a million more than the sector counted just five years ago, according to seasonally adjusted preliminary employment figures the Labor Department released last month.
Earlier this year, Amazon said it was raising pay for hourly employees by between 50 cents and $3 an hour, although the online sales leader declined to say what the average raise would be. Amazon’s starting wage for warehouse workers is at least $15 an hour. The Walmart rival said Wednesday it was hiring to fill tens of thousands of hourly positions in its operations network, in addition to more than 40,000 corporate and technology roles in the U.S.
“The pay rate has to be competitive because that’s the first thing hourly associates look for,” said Brian Devine, senior vice president of logistics-staffing firm ProLogistix, which works with companies such as Walmart Inc. and Target Corp. The firm’s average starting pay for warehouse workers was $17.31 an hour in the week ended Aug. 14, he said, up nearly 14% from the same period in 2020.
“There’s simply not enough human beings to fill all the open positions,” he said.
Amazon Plans To Add 40,000 Workers To U.S. Corporate Ranks
Amazon.com Inc. says it plans to add more than 40,000 people to its corporate ranks in the U.S., a hiring spree the company is calling its biggest-ever recruiting and training event.
The world’s largest online retailer and cloud-computing company said in a statement that it plans to hold a career fair Sept. 15, continuing a pattern in recent years of inviting job seekers en masse to learn about the company’s open roles. Amazon didn’t specify where the positions would be located, but the company’s job posting site on Wednesday listed Seattle, Arlington, Virginia, New York, Bellevue, Washington and Sunnyvale, California, with the most open roles.
Amazon employed 950,000 people in the U.S. at the end of June, out of 1.3 million worldwide. Most of those people work in the company’s massive logistics division, primarily in the warehouses that store and pack items.
The company’s ranks have swelled during the pandemic, as stay-at-home orders made the case for online shopping. Former Chief Executive Officer Jeff Bezos earlier this year pledged Amazon would focus more on the welfare of its workers, a statement that followed an unprecedented union drive in the company’s warehouse ranks and activism among corporate employees at its Seattle headquarters.
Amazon shares were up about 1% Wednesday morning in New York.
Fidelity’s Hiring Spree Is A Cautionary Signal
Wall Street has a history of adding lots of staff just as the market is peaking.
When I heard the news that Fidelity Investments plans to make 9,000 new hires, mostly in client-facing and technology-related positions, I immediately thought of the old adage that Wall Street hires on the highs, and fires on the lows.
That saying comes from the investment banking industry and its famously cyclical hiring practices, loading up on bankers and traders when times were good, and purging them when the markets went south. Fidelity is in a different business — retail brokerage and asset management — but the same principle applies.
Retail traders have gravitated toward the markets in the last year as stocks staged an epic rally, with the benchmark S&P 500 Index doubling from the early days the pandemic. Increased trading activity has led to increased demand for customer service and support personnel.
This is similar to what Vanguard went through in 2016-2017 during the index fund boom, which catapulted the firm’s assets under management to more than $5 trillion. That period was very disconcerting to so-called active money managers. There was a lot of debate, not always polite, over whether indexing was a form of market socialism, making it impossible for anyone to “beat” the broad indexes.
At the time, I sided with the active managers, believing that the index craze was a malignant influence on the markets. But I would trade that for today’s retail stock-trading frenzy anytime. Back then, investors were conditioned to buy and hold. Now, it’s all just unproductive speculation.
The question is whether this is a permanently high plateau of retail trading activity, or will a bear market cause all these new investors to become frustrated and give up trading stocks? I think we know the answer. But for the time being, retail trading makes up a larger and larger percentage of market volume, and retail brokerages are seeking to exploit the opportunity and expand capacity.
TD Ameritrade’s Investor Movement Index — a measure that has tracked clients’ positioning in the market since 2010 — rose to the highest level on record in June, according to Bloomberg News. As for a bear market, there does not seem to be one on the horizon, with the Federal Reserve continuing to pump massive amounts of liquidity into the economy.
From a competitive standpoint, Fidelity may lack the “cool” factor and “gamification” that Robinhood Markets Inc. provides, but it is still doing a decent job at convincing younger investors to open accounts. It opened 700,000 new accounts for investors age 35 and younger during the second quarter.
The conventional wisdom around these sorts of accounts with small balances used to be that they were unprofitable and less desirable, but now the retail brokerages seem to be willing to do a lot of unprofitable business in the hopes that small accounts one day become large accounts. That is more likely to happen at a place like Fidelity, that has a full suite of customer offerings.
Robinhood is purely for speculation, and not for accumulating assets.
Fidelity shouldn’t try to compete with the likes of Robinhood, and an effective marketing strategy would be to characterize Robinhood as unserious — the type of place where you day-trade “meme” stocks like GameStop Corp. and joke cryptocurrencies like Dogecoin.
In the event that the stock market does enter a protracted bear market sometime soon, Fidelity will be much better-positioned to handle it as a diversified financial company than Robinhood, which relies almost entirely on speculative trading activity. The parallels with 1999 are impossible to miss. All the day traders of the dot-com bubble eventually gave up and went back to their day job. It took them 20 years to return.
This is one of those time-tested sentiment indicators in markets. Fidelity is perhaps the first firm to announce a dramatic increase in headcount, but probably won’t be the last. Wait for the banks to follow suit, and then you know the top will be in. There is no such thing as a permanently high plateau.
U.S. Companies Add Fewer Jobs Than Forecast, ADP Data Show
U.S. companies added fewer jobs than expected in August, reflecting persistent hiring challenges and suggesting a slowdown in the labor market recovery.
Businesses’ payrolls increased by 374,000 last month, after a revised 326,000 gain in July, according to ADP Research Institute data released Wednesday. The figure fell short of all estimates in a Bloomberg survey of economists.
The weaker-than-expected hiring gain suggests firms are still struggling to attract applicants and fill a record number of vacant positions. At the same time, the delta variant could present additional headwinds to hiring if consumer spending on services like dining out pulls back meaningfully.
Service-provider employment increased 329,000 in August. Payrolls at leisure and hospitality businesses advanced 201,000 during the month. Employment at goods producers was up 45,000, led by a 30,000 jump in construction.
“The delta variant of Covid-19 appears to have dented the job market recovery,” Mark Zandi, chief economist of Moody’s Analytics, said in a statement. “Job growth remains strong, but well off the pace of recent months.”
The combined payroll gain in July and August was the slowest since the start of the year, according to ADP.
The figures come just before the government’s monthly jobs report, and economists expect private payrolls to advance by 652,000 in August. The unemployment rate is projected to fall to 5.2% as participation improves.
The increase in August payrolls was broad across firm sizes. Companies with 500 or more workers added 138,000 while small businesses took on 86,000.
ADP’s payroll data represent firms employing nearly 26 million workers in the U.S.
America’s Unequal Jobs Recovery Leaves Some Minorities Behind
The U.S. government has spent billions of dollars to keep the economy afloat, but not all cities and groups have benefited.
The U.S. government has poured trillions of dollars into the economy to support pandemic recovery, with President Joe Biden and Federal Reserve Chair Jerome Powell vowing a rebound that’s equitable. To monitor progress toward that goal, Bloomberg has been tracking unemployment rates by race and ethnicity in metropolitan areas across the U.S. Available data show an uneven picture, with minority communities in some areas faring much better than others elsewhere.
Black residents of Atlanta have seen unemployment fall from pre-pandemic levels, which makes the city an outlier among U.S. metro areas. The city’s historically strong jobs market, combined with Georgia’s early reopening, has contributed to Atlanta’s resilience: The jobless rate for Black residents stands many percentage points below the national Black unemployment rate, even after accounting for the margin of error.
* Arizona’s most populous urban area, Phoenix, has seen a solid recovery among its many Hispanic residents. Joblessness among Hispanic workers has fallen to 5.1%. That’s below the 2019 rate and about equal to the national Hispanic unemployment rate within the margin of error.
* The jobless rate for San Francisco’s Asian community is two to four times higher than it was at the same time in 2019. Asian workers are concentrated in industries that were hit hard by the pandemic, including food services and personal care, according to the Chinese Progressive Association, a San Francisco-based advocacy group.
* Although oil prices have recovered since they plunged in 2020, hiring has been slower to follow in Houston. As of July, the city had the second-highest Black and Hispanic unemployment rates of the 15 metro areas tracked by Bloomberg.
* In Chicago, unemployment has roughly doubled for groups we tracked over the past two years. The picture remains as unequal as it did in 2019: Black residents are faring the worst, with almost 15% unemployed.
Forget Finance. Supply-Chain Management Is The Pandemic Era’s Must-Have MBA Degree
The just-in-time inventory systems embraced by many businesses led to empty shelves and costly bottlenecks. That’s put a rare spotlight on supply-chain programs, which are attracting more students.
Stores with no toilet paper. Colossal cargo ships run aground in the Suez Canal. Factory shutdowns in Vietnam. Ports closed in China. It almost seems that not a day goes by without reports of another supply-chain snafu wrought by the pandemic, which dismantled just-in-time inventory systems that couldn’t cope with massive, simultaneous disruptions of supply and demand.
Companies have struggled to adapt, with some taking unusual steps. Walmart Inc. and Home Depot Inc. are chartering their own private cargo vessels so they don’t get caught short as the holiday season approaches, and logistics experts say disruptions from congested ports won’t end anytime soon.
The tumult has forced companies to lavish more attention on their supply-chain professionals, who typically toil in obscurity until disaster strikes. It’s also prompted business schools to refresh their supply-chain curricula to make sure the next generation of logistics managers are prepared for future crises.
“For years, we had sort of taken logistics for granted,” says Skrikant Datar, the dean of Harvard Business School. “The pandemic caused us to rethink it.”
The problem, says Hitendra Chaturvedi, a supply-chain management professor at Arizona State University’s W.P. Carey School of Business, was that supply-chain education and theories had grown as rigid as some of the practices out in the real world. “After years of teaching without any tremors,” he says, “our courses had become less flexible.”
In response to those tremors, business schools are now emphasizing things such as risk mitigation, data analytics, and production reshoring—while also carving out room to explore more intangible topics like ethics, communication, and sustainability. Penn State’s Smeal College of Business is adding a master’s course in supply-chain risk management next year, with lessons taken straight from the pandemic experiences of corporate partners including Hershey Co. and Dell Technologies Inc.
The course will count toward a new certificate program in risk management that’s also in the works. The W.P. Carey School of Business also plans to offer a certificate in supply-chain resilience.
“It’s not like we don’t cover risk already, but this would give them a deeper dive,” says Kevin Linderman, chair of Smeal’s Department of Supply Chain and Information Systems, which has grown more popular with students thanks to high-profile incidents such as the grounding of the Ever Given cargo ship in the Suez Canal in March, which snarled global commerce for nearly a week. This academic year more than 400 juniors in Smeal’s undergrad program have declared their intent to major in supply-chain management, up from about 270 the previous year.
Incoming business students who once defaulted to finance or marketing now want to explore supply-chain management, says Alok Baveja, a professor at Rutgers Business School, whose faculty includes former executives of nearby pharmaceutical giants such as Johnson & Johnson. When they graduate, they’ll have plenty of options:
A record 50 companies plan to attend a supply-chain career fair at Georgia Tech in September—about double the number that typically come to recruit students of the program—including newcomers Honda, Honeywell, and Procter & Gamble.
Students who pursue supply-chain degrees this fall are certain to get an earful about the limitations of just-in-time inventory systems, which grew in popularity during the 1990s as companies aimed to mimic the success of auto makers like Toyota Motor Corp., the gold standard of lean manufacturing. For some companies, though, getting lean “became a religion,” says Penn State’s Linderman, and their orthodoxy became their undoing when the pandemic hit and there was no surplus stock to be found.
Covid-19 exposed the weaknesses of legacy inventory systems, which typically emphasize cost reduction above all else, says Hyun-Soo Ahn, a professor at University of Michigan’s Ross School of Business. The pendulum is now shifting the other way: At Walmart, whose bottom-line focus is legendary, U.S. inventory rose 20% last quarter as it doesn’t want product shortages come Christmastime.
Still, shuttered factories, port congestion, and trucker shortages have brought more chaos to already overtaxed supply chains, raising prices on groceries and jeopardizing the delivery of millions of presents for the holidays.
Classroom discussions at Penn State and other supply-chain specialists will now delve into the downsides of sourcing too much from China or any single country, while they also explore the role that new technologies like machine learning and artificial intelligence can play in manufacturing and inventory decisions. Old research, meanwhile, is getting reinterpreted through the pandemic’s lens, says Gopalakrishnan Mohan, chair of ASU’s supply-chain department.
What’s also needed, though, is a realization in corporate C-suites that logistics isn’t just an expense—it can actually create value when done well, according to MIT’s Jarrod Goentzel. He’s the principal research scientist at the school’s Center for Transportation and Logistics, which works with corporations such as Amazon.com Inc. and Intel Corp. and also a lecturer in the center’s one-year master’s program in supply-chain management.
It helps that high-profile chief executive officers like Apple Inc.’s Tim Cook and Mary Barra of General Motors Co. spent time running complex supply chains before they got the top jobs, but logistics educators say greater boardroom acknowledgement of the make-or-break role such skills play is long overdue.
“Any company that says they fully understand their supply chain is lying,” says Goentzel, who believes that supply-chain practitioners should be certified just like accountants. “It’s time for the profession to wake up. The 20th century was about finance. The 21st century should be about supply chains.”
The Jobs Numbers: Who’s Hiring In America—And Who’s Not
U.S. employers added 235,000 jobs in August, and the nation’s unemployment rate fell to 5.2 percent, according to data released Friday by the Labor Department. Meanwhile, average hourly pay for workers rose 4.3 percent from a year earlier, to $30.73 from $29.47.
Leaders & Laggards
Below are the industries with the highest and lowest rates of employment growth for the most recent month. Additionally, monthly growth rates are shown for the prior year. The latest month’s figures are highlighted. Wage data are shown when available.
Connecting The dots
Follow the dots in the chart below to see how shifts in employment have coincided with changes in average hourly pay from one month to the next. The greater the vertical distance between dots, the larger the change in wages; the greater the horizontal distance, the larger the change in total number of jobs.
Schools Are Open But Don’t Have Enough School Bus Drivers
Drivers resign, citing Covid-19 and vaccine concerns; districts offer bonuses to recruit as some families go without busing.
School districts across the country are grappling with a shortage of school bus drivers after some drivers resigned over worries about being exposed to young unvaccinated children and others quit over requirements that they get a Covid-19 vaccine.
The shortage, in every region of the country, has left some students without district-provided transportation, and others with long commutes to and from school at a time when schools are returning to in-person classes after a hybrid or remote pandemic year.
School districts and bus-contractor companies are offering signing bonuses, pay increases and even full-time benefits in hopes of attracting more applicants.
“The pandemic completely, absolutely 100% exacerbated what was already a difficult industry to be able to recruit and find individuals to come work and transport children,” said Danielle Floyd, general manager of transportation services for the School District of Philadelphia.
A recently published nationwide survey of about 1,500 school transportation professionals, which was conducted by three national transportation associations, found that roughly two-thirds of all respondents said that the bus-driver shortage is their No. 1 problem or concern.
About half of survey respondents described their driver shortage as “severe” or “desperate.” Half of survey respondents said the rate of pay is a major factor affecting their ability to recruit and retain drivers, and others cited the length of time it takes to train and license drivers.
Some districts found themselves facing sudden resignations after instituting vaccine mandates. “There’s no doubt in my mind that those mandates will affect the driver pool,” said Curt Macysyn, executive director of the National School Transportation Association.
Last month, Chicago Public Schools scheduled pickup times to start approximately 15 to 30 minutes earlier than prior years due to a shortage of about 420 bus drivers.
In mid-August, the district announced that all employees would need to submit proof of full vaccination by Oct. 15.
The week of Aug. 23, approximately 10% of bus drivers resigned, which bus vendors said was “likely driven by the vaccination requirements.” Approximately 70 drivers resigned on Aug. 27 alone. The shortage meant the district couldn’t provide transportation for about 2,100 students.
The district is offering families transportation stipends of $1,000 for the first two weeks, and $500 the following months for the 2,100 students without transportation, as well as for students who are affected by longer route times.
Nashondra Henderson’s 16-year-old son no longer has transportation. Ms. Henderson’s son, who is a junior at the district’s Roberto Clemente Community Academy, has autism. The school district called her on Sunday, the day before school reopened for the fall, to inform her that the school bus wouldn’t be dropping off or picking up her son.
No one could say when his busing will be restored, she said. Ms. Henderson has six other children whom she has to help get off to school, and said her son can’t take public transportation on his own.
Because there is no bus, and Ms. Henderson is unable to get him to school, he is staying at home for now and doing remote learning. She said the district offered her a $1,000 stipend for the first two weeks, and $500 a month after. “I don’t need the $500 a month; I need my son to get to school,” she said.
The district said it is giving priority to routes for diverse learners, whose families will be provided the stipend in the interim, and will be offered bus transportation in the near future. The district is working with families to solve the problem, it said, in a statement.
Part of the problem schools face is competition with companies like Amazon.com Inc. and Uber Technologies Inc. for drivers, says John Benish Jr., president of Cook-Illinois Corp., a school bus contractor that services more than 200 school districts.
Mr. Benish said some potential bus drivers are wary of coming into contact with large groups of children, many of whom aren’t eligible to be vaccinated. Others, he said, are opposed to the vaccine and might not come into work if it is mandated. The company is about 20% short of necessary drivers at some of its locations, and the problem is expected to persist until after the holidays, he said.
“It’s just going to be a while to get this shaken out,” he said.
Companies Need More Workers. Why Do They Reject Millions of Résumés?
Automated-hiring systems are excluding many people from job discussions at a time when additional employees are desperately needed.
Companies are desperate to hire, and yet some workers still can’t seem to find jobs. Here may be one reason why: The software that sorts through applicants deletes millions of people from consideration.
Employers today rely on increasing levels of automation to fill vacancies efficiently, deploying software to do everything from sourcing candidates and managing the application process to scheduling interviews and performing background checks. These systems do the job they are supposed to do. They also exclude more than 10 million workers from hiring discussions, according to a new Harvard Business School study released Saturday.
Job prospects get tripped up by everything from brief résumé gaps to ballooning job descriptions from employers that lessen the chance they will measure up. Lead Harvard researcher Joseph Fuller cited examples of hospitals scanning résumés of registered nurses for “computer programming” when what they need is someone who can enter patient data into a computer.
Power companies, he said, scan for a customer-service background when hiring people to repair electric transmission lines. Some retail clerks won’t make it past a hiring system if they don’t have “floor-buffing” experience, Mr. Fuller said. This reliance on automation filters big sections of the population out of the workforce and companies lose access to candidates they want to hire, he added.
Harvard’s findings—resulting from a survey of companies and workers conducted by the business school’s Project on Managing the Future of Work and consulting firm Accenture PLC—offer new insight into the current challenges of matching employers with potential employees as the economy reopens following a pandemic-led downturn.
That process is proving to be unusually slow and complicated. The number of open U.S. positions surged to a record 10 million in June, the most recent month for which government data is available.
Many company leaders—nearly nine out of 10 executives surveyed by Harvard—said they know the software they use to filter applicants prevents them from seeing good candidates.
Firms such as Amazon.com Inc. and International Business Machines Corp. said they are studying these tools as well as other hiring methods to understand why they can’t find the workers they need. Some said the technology can be changed to serve them better, while others are turning to less-automated methods to find the right people.
“The typical recruitment strategies we use weren’t meeting the hiring demand,” says Alex Mooney, senior diversity talent acquisition program manager at Amazon, which has hired 450,000 people in the U.S. since the start of the pandemic.
Managing The Tsunami
The reliance on software to help with hiring can be traced back to the late 1990s, when companies first stepped back from paper applications and embraced the idea of filing for jobs online.
The e-applicants were supposed to democratize the search process by giving more people a chance. But they also created a tsunami of applications that overwhelmed companies. The algorithms created to help with this process, known as applicant-tracking systems, filtered tons of prospects down to a select group.
Several companies make the talent-sifting software, and one of the biggest providers is Oracle Corp. with its Taleo system. Such systems, Harvard said, are now employed by 99% of Fortune 500 companies and 75% of the 760 U.S. employers Harvard surveyed as part of its study. Oracle declined to comment.
That much automation made it difficult for some applicants to stand out. The software typically ranks candidates according to broad affirmative criteria—such as candidates with a college degree—as well as negative criteria such as candidates who were convicted of a crime.
The longer and more complicated the job description, the more people get weeded out by the automated systems. Each additional requirement eliminates candidates potentially equipped to fill a role, according to Harvard’s researchers.
Differences between the way a technical skill is described by the military and the corporate world can also mean a veteran with decades of sought-after experience never has a chance, Harvard’s researchers said.
“It’s very challenging translating my expertise in the military to ‘civilian,’” said Rome Ruiz, who formerly was a captain in the U.S. Navy with thousands under his command and is now looking for an executive role in technology after retiring this month. “I don’t know if they understand what I’m saying.”
Another hurdle for workers is that these software systems often eliminate those with a gap in employment if companies believe the currently-employed are more capable of filling a role successfully. A large percentage of U.S. companies surveyed by Harvard—49%—choose to eliminate candidates for roles that traditionally require less than a bachelor’s degree because of an employment gap of six months or longer.
A big résumé gap has long been a handicap for applicants, even before automated hiring became so widespread. What’s different now is that the practice persists at a time when companies are desperate for new hires, and those who were rejected by the automated systems don’t get to hear about these concerns from a hiring manager directly.
Harvard said the use of a résumé-gap scan can eliminate huge swaths of the population such as veterans, working mothers, immigrants, caregivers, military spouses and people who have some college coursework but never finished their degree.
Overlooking a candidate based on a résumé gap relies on inferences from a universe of possibility employers can’t truly know, said Mr. Fuller.
A problem pregnancy, bout of depression or moves alongside a spouse in the military could take someone out of the workforce, he said, and many résumé gaps are the results of economic factors beyond a worker’s control such as a recession-driven layoff followed by a period of unemployment.
Companies said they are eliminating candidates they want to hire. Of those Harvard surveyed, 90% believed high-skilled prospects were being weeded out because they didn’t meet all of the criteria listed in the job description.
Some are making changes. One company that said it made a point to go after these deleted workers is IBM, which received 3 million applications in 2020. It decided to rethink how it evaluates these people several years ago when it had trouble filling cybersecurity and software development positions.
The company eliminated college degree requirements for half its roles in the U.S. and rewrote job descriptions to better capture a role’s true needs. Since then, IBM has seen a 63% increase in underrepresented minority applicants, according to Nickle LaMoreaux, IBM’s chief human resources officer.
“Strategically, our point of view was if you have the skills why should it matter how you got them?” Ms. LaMoreaux said.
Amazon—which announced this week that it is in the market for 40,000 more workers in the U.S.—now hires from special programs created to bring in new types of workers who may have been filtered from its automated systems. That includes veterans and military spouses, parents returning to the workforce and people with a handicap.
The nation’s largest bank, JPMorgan Chase, has also tried to reach more deleted workers. Its tactic: No longer asking job applicants whether they were convicted of a crime. The company focused on developing partnerships with community organizations that supply housing, transportation and job connections to people with a criminal record and decided that only JPMorgan Chase’s global security team needed to know a worker’s history during a background check.
Some states and cities now require employers to consider a candidate’s qualifications without the stigma of a conviction or arrest record.
“This is a population that did not think there were roles they were eligible for in this firm,” said Monique Baptiste, the bank’s vice president of global philanthropy who works in collaboration with HR.
One technology giant, Microsoft Corp. , now has a new way to find candidates who are on the autism spectrum. Though these workers often bring exceptional attention to detail and problem-solving skills, the company found that elements of its screening and high-stress interview process were unfriendly to such candidates.
“The traditional front door—when you interview at Microsoft or any company—many folks weren’t getting through that front door because of résumés or social behaviors on a phone screen,” said Neil Barnett, Microsoft’s director of inclusive hiring and accessibility.
Smaller companies are taking new steps, as well, to get around the reliance on software. Ohio restaurant chain Hot Chicken Takeover, which employs 170 people, doesn’t use any automated screening processes. It relies instead on hiring managers to screen and sort candidates.
“The staffing crisis has demonstrated employers can’t just look the other way,” said founder Joe DeLoss. “They have to develop and support a workforce if you want to have a workforce at all.”
This method costs more, Mr. DeLoss said, but he added that it is manageable because of the company’s size. During the worst part of a talent shortage for restaurant workers earlier this year, staffing levels dipped to about 70% but have since returned to 95%.
At any given time, 40% to 60% of the company’s staff are people who were previously incarcerated, he says. One is Shaun Higginbotham, who was released from state prison in January 2018 after serving four years and had been unable to find jobs in warehouses and factories. He is now an assistant general manager at Hot Chicken Takeover in Strongsville, Ohio.
“I remember thinking, I’m trying to better myself and do the right thing and nobody’s giving me a break,” said Mr. Higginbotham, who is 40 years old. “I understand why people get out and end up going back.”
‘We Do Not Stack Up’
Some workers are changing their tactics, too. Those who are not getting any traction with online job postings are turning to more old-fashioned ways of finding work, such as referrals from friends and family.
Ray Rodriguez was able to get a job with IBM after a professor at Dutchess Community College in Poughkeepsie, N.Y. connected him to one of the managers of IBM’s apprenticeship program.
He visited the company’s campus even though he noted that he didn’t have industry experience—something he said other hiring managers mentioned as a strike against him. He was accepted by the apprenticeship program, which offers paid training to qualified candidates without experience, and learned how to be a chip tester.
The job ended a frustrating four-month period of searches for Mr. Rodriguez, who earned an associate degree in electrical technology in 2019. “That’s what I was hoping for,” said Mr. Rodriguez. “For a company to give me a chance.”
Sonam Oberai seized an opening when her husband forwarded her an internal email saying Wayfair Inc., where he worked, was seeking referrals. She had been out of work since 2017, when the senior business systems analyst in human resources technology resigned to take care of a new baby. She started work in July—ending a search that involved roughly 100 applications, she said, all with no response.
“I just couldn’t get my résumé in front of a recruiter no matter how appropriate my résumé was for that position,” she said.
There is no way for workers to know if they were denied a position because of how software systems filter candidates. Still, some are convinced it was a factor.
“It’s kind of like you’re racing against everyone applying for the job and an algorithm you don’t understand,” said Verina LeGrand, a U.S. Air Force veteran who had trouble finding a new job after a period when she didn’t work.
Ms. LeGrand was on maternity leave when she was laid off from her pharmaceutical sales job in 2017. She took a break from her job search to care for her children and grieve the death of her husband, a dark period that simply appears on her résumé as two years that she wasn’t employed, she said.
In 2019, when she was ready to return, Ms. LeGrand worked with a professional résumé writer. “I got no hits—and I mean absolutely no hits,” said Ms. LeGrand, who is 41. “I can’t even remember the amount of jobs I applied to. I got nothing in return.”
She found work at Fidelity Investments after noticing a banner ad online from reacHire, which develops programs for women re-entering the workforce following a break. She joined the human-resources team and was hired permanently after four months.
“For people like me or other women that have been out of the workforce,” said Ms. LeGrand, who has since been promoted by Fidelity, “we do not stack up against the algorithm.”
Workers Want to Do Their Jobs From Anywhere and Keep Their Big-City Salaries
Employers see remote work as an opportunity to save money by cutting pay; employees argue that their work has the same value no matter where they do it.
David Pedersen decided this summer that he wanted to move to Denver from Seattle, continuing to perform his tech-company job remotely from his new city. His primary concern: Would the shift require a pay cut?
“It’s kind of like a trigger word for me,” Mr. Pedersen, 38 years old, said of his dreaded conversation with the human-resources department over a potential salary adjustment.
During the pandemic, many people are moving away from their offices, particularly in big cities. Employers are trying to save money by cutting pay commensurate with market rates in their workers’ new hometowns, but employees are now pushing back.
“This is in the air. Lots of people are facing this,” said Lowell Taylor, a professor of economics at Carnegie Mellon University who studies labor markets and the effects of demographic change on economics.
In 30 years of teaching and research, he said, he has never witnessed anything like employees’ current level of interest in remote work—or the pushback on the possibility that pay cuts would come with it.
Mr. Taylor has witnessed this happening with his own friends. One attorney relocated from New York City to central Ohio and continues to negotiate with his law firm to avoid a pay cut. If he’s not successful, Mr. Taylor said, his friend plans to look for another job. A CEO in the Bay Area who wants to leave California has strategized with Mr. Taylor about how to talk to her board of directors, which has signaled that her pay could be reduced if she moves.
‘We’re exporting top market salaries all over the place.’
— Okta CEO Todd McKinnon
“I think the economics are on her side,” Mr. Taylor said. “If workers can be as productive working from Houston or Utah as they can working from the Bay Area, the firm will eventually have to pay them the same. Firms may not like it. They may think it’s only fair they get paid less if they live in a less expensive place, but that’s not how markets work.”
Early in the pandemic, some employers, including online payment processing company Stripe Inc., offered one-time relocation bonuses to offset a reduction in base salary for workers who wanted to leave high-cost cities such as San Francisco. Some, grateful for job security, gladly took the offers.
Now, after more than a year of adjusting to remote work and remaining productive—in some cases increasing their hours—more people are questioning why their value is based on their geographic coordinates.
One tech worker who moved to Austin from San Francisco is facing a 10% salary reduction in January. Now that he’s settled in Texas, he doesn’t feel the move has saved him much, if any, money. He recently bought a house in Austin after making three unsuccessful offers on other homes amid bidding wars that were reminiscent of the San Francisco real-estate market.
His rejected offers were 20% over the asking prices and life in Austin, he said, is turning out to be more expensive than he had anticipated. During a coming performance review at work, he said, he plans to ask for a 10% raise to offset the pending relocation reduction.
In the past two months, more than 20 companies seeking guidance on what to do about the salaries of employees who have moved have called Kyle Holm, a vice president with Sequoia Consulting Group who advises clients on compensation and benefits.
Geography’s impact on workers’ compensation used to be a given, he said, adding that now more employees are questioning whether a pay cut makes sense given that they are working more hours, producing the same quality of work and feel they could find another job if they needed to.
For instance, people moving from San Francisco to Austin can argue there is high demand for their skills in Texas—and they would be right, Mr. Holm said.
“Particularly the engineers are basically saying, like, we’re good where we are and we’re able to do our work where we are, maybe even more efficiently than before,” said Mr. Holm. “Take away location and adjustment to compensation on its face just doesn’t make sense because the output is still there.”
‘[Companies] really won’t be saving the money until they can have a chance to renegotiate their leases and lower their footprint.’
— Employee-Benefits Consultant Jason Adwin
While there is no one-size-fits-all approach, remote work has fundamentally changed employee expectations in ways Mr. Holm said he expects to be long-lasting. Cutting pay won’t engender loyalty.
“If an employee from a high cost-of-labor area is making $100K and their current employer wants to adjust their pay down by 15% based on their new location, it’s very likely that person can find a comparable job at their current rate, or within 5%, that will allow them to stay in their new location,” he said.
Facebook Chief Executive Mark Zuckerberg said early in the pandemic that where employees were located would affect their pay. One employee at the social-media giant relocated from Washington, D.C., to the rural Illinois town where she was raised.
In the beginning, she thought the move would be temporary, but rediscovering her roots made her want to make a permanent change.
In exchange for the ability to work indefinitely on a remote basis, the Facebook worker took a 9.5% pay cut and said the amount of money she’s saving in the Midwest outstrips the reduction in salary. She recently paid $120,000 for a four-bedroom farmhouse that she is in the process of renovating.
Even though the salary adjustment was worth it, she questions location-based pay. While working from home, she’s doing the same amount of work but saving the company money because she no longer gets perks such as free, on-site dry cleaning and meals.
Many employers feel they are doing enough by granting their workers the flexibility to work from anywhere, said Jason Adwin, a senior vice president with Segal Group Inc., an employee-benefits consulting firm. Savings from keeping workers away from offices won’t be realized for a while, he added.
“They really won’t be saving the money until they can have a chance to renegotiate their leases and lower their footprint,” he said.
Ultimately, the future of compensation for remote work will come down to how much location-based pay scales affect companies’ ability to hire and retain top talent. “Employers are really going to be loath to lose good people,” Mr. Adwin said.
“Are those people going to stay for lower rates or are they going to leave?”
From the company perspective, there is a risk in reducing the salaries for those who move, since any reduction, no matter the reason, is bad for morale.
As companies in San Francisco and New York City have started hiring talent to work remotely all over the country, there has been upward pressure on wages: Startups in smaller cities are finding that coastal companies are coming in offering somewhere between a coastal salary and a local one, executives say.
Okta Inc., the cloud-software company, initially cut pay for relocating workers, but reversed that policy in April. Instead, the company said, it is trying to attract the right talent wherever those people want to live.
“We’re exporting top market salaries all over the place,” Okta CEO Todd McKinnon said.
Mr. Pedersen, the former Seattle tech worker, was relieved that his employer didn’t insist on shrinking his checks when he raised the prospect of moving to Denver, where he relocated earlier this month.
Such negotiations haven’t always gone as smoothly for him. Two years ago, when he worked for a different tech company and requested a move from San Francisco to Seattle, he was told he’d have to take a pay cut. His boss at the time went to bat for him and argued against the change. He moved to Washington without an adjustment, but said the damage was done.
“Any loyalty I had for the company went out the window,” Mr. Pedersen said. “My contract states a certain number and that’s what I’m valued at whether I live in Mississippi or Mars.”
Fewer Pediatricians, More Cooks Seen In Dismal U.S. Jobs Outlook
U.S. employment will see stunted growth during the remainder of the decade, with technology eliminating some roles and retiring Baby Boomers contributing to a drop-off in the share of Americans participating in the job market, according to federal government projections.
The U.S. will add 11.9 million jobs through 2030, according to a new analysis from the Bureau of Labor Statistics. The bulk of that, however, will simply reflect a recovery from the damage caused by the Covid-19 crisis. Compared with the 2019 pre-pandemic peak for the BLS’s series, the jobs gain will be just 2.6 million — weaker than in previous decades.
About one-third of the jobs created, or 3.9 million compared with the current baseline, will be in low-wage work — a part of the economy devastated by coronavirus-linked restrictions. That covers categories that pay less than $32,000 a year, or roughly $15 an hour.
BLS analysts also project that while economic growth will run at a faster average pace than previous years and worker productivity will increase, the country’s labor participation rate will decline as the workforce ages and fewer young people work.
The forecasts paint a picture of a U.S. economy relying on the very jobs that President Joe Biden’s administration vowed to improve for millions of low-income Americans.
Fastest Growing Occupations
Fastest growing job on a percentage basis are for low paying health aides to assist an aging population, and patients with chronic conditions.
Total employment is projected to increase about 7.8% by 2030, to 165.4 million. That rise, which equates to just over 1 million added to payrolls each year, is about half the annual gain in the past decade, setting aside a decline during last year’s pandemic recession.
Low-wage sectors such as home health care are seen expanding, while the number of cooks, waiters and waitresses along with fast food counter workers — all jobs decimated during the pandemic — are expected to add almost 1.5 million jobs by 2030.
The BLS sees 5.7% fewer chief executive officers by 2030, partly thanks to an increasing share of the economy being accounted for by larger companies — a concentration the Biden administration has been battling. Changing corporate organizational structures are also seen reducing the need for having separate CEOs for different units.
Retail is Still Dying…
After being hammered by a pandemic that kept people home, retail trade is projected to lose more than half a million jobs by 2030, the most of any sector. The crisis has served to deepen struggles already faced by brick-and-mortar retailers, competing with the ease and access of online shopping.
…So Are Other Jobs
Many jobs with the fastest employment declines are in industries made obsolete by technology, with the need for watch repairers or typists fading. But others — including some that require advanced degrees — follow demographic trends. For example, by 2030 the BLS expects 2.1% fewer obstetricians and 1.8% fewer pediatricians as U.S. birth rates slow.
Some fields, such as compensation and benefits management, are expected to come under more pressure as capital substitutes labor. The BLS expects a decrease in these roles due to outsourced work or automation through specialized software.
More than half of the industries projected to have the most rapid declines are in manufacturing. The BLS expects global competition and the adoption of productivity-enhancing technologies, such as robotics, to continue to pressure U.S. factory employment.
Fewer People In The Labor Force
Over 30 years, the U.S. work force has seen a 6.7 percentage point decline in the participation rate as younger Americans work less, older work more.
While employment is expected to expand to 165.4 million in 2030, the actual share of the population in the labor force will decline to 60.4% by the end of the decade from 61.7% in 2020. That’s largely a result of Baby Boomers retiring, a continuation of the declining trend in men’s participation and a slight drop in that for women.
Compared with a generation ago, the U.S. labor force is also expected to continue aging. By 2030, almost one in 10 workers are projected to be age 65 or older. And the average worker will be about 3 1/2 years older in 2030 versus 2000.
How This Woman Went From Six Figures In Debt And Unemployed To Financial Independence
‘Now I have the ability to be OK indefinitely’
After Hurricane Katrina brought devastation to New Orleans in 2005, Sylvia Hall threw out everything except her books, family photos and clothes and packed it up in her Honda Civic along with her dog.
She couldn’t afford her apartment because she no longer had a job to go to, and she was forced to get rid of nearly all of her belongings. “I was lucky enough to still have things from the hurricane but still had to get rid of them,” she said. “I felt a vulnerability I never felt before.”
This experience was the beginning of a journey to financial freedom. She remembered when she got her things — such as her exercise equipment or her furniture — as she was picking it all up to throw out.
“It made me think of the things I bought,” she said.
Hall had just passed the bar exam in Louisiana and was six figures in debt from law school. She was only a week into her new legal job when the hurricane hit and the student loan grace period was coming to an end.
But since then, she has reinvented herself. She moved to Seattle in 2008, amassed 25 times her annual expenses and a real estate portfolio and plans to retire sometime next year (she originally intended to retire at the end of this year, but may postpone her date to finish court cases).
Hall started by paying down her debts and building an emergency fund. She worked her legal job during the day and then took on a side job working nights and weekends at Domino’s to increase her income.
“It kept me grounded, I was so happy to work it,” she said. “I was enthusiastic. Others thought [of the job] as a last resort.”
Hitting a $0 net worth was a moment of pride for her, because it meant she was no longer in debt.
Hall approached financial independence in steps — first having one month of savings set aside, then two months, then a year, then two years. She always thought of her savings as a way to protect herself if something happened, like a lost job.
“Now I have the ability to be OK indefinitely,” she said.
Hall’s perspective applies to what she buys as well. So much of consumables are disposable, and after experiencing such a loss after Hurricane Katrina, she’s more mindful of her purchases. Hall now spends more on experiences and trips than she does on material things.
She was also aware of how much more loss was surrounding her — people who had lost their homes and everything in them, as well as loved ones, to the natural disaster.
“I wasn’t materialistic to begin with, but when you recall buying or accumulating something it makes you realize this stuff is just stuff,” she said. “It can be gone in a blink of an eye.”
Employers Beware: Hiring Software Could Weed Out Future Stars
Not all companies should rely on algorithms to filter through the flood of resumes.
Finding the right person for a job can seem impossible when hundreds are applying for a single position at once. Many employers have turned to software to whittle those candidates down, but there’s a problem: The software can snub perfectly good workers.
So-called Application Tracking Systems, the official term for resume-filtering software, were designed to help companies cope with the growing number of job applications flooding in for each vacancy over the past two decades. Nearly all Fortune 500 companies use this kind of software for recruiting, according to a Harvard Business School study released earlier this month.
The study found that millions of qualified job seekers were being rejected at the first stage of the application process because they didn’t meet certain initial criteria set by the recruitment software.
For example, the software might put someone in the “no” pile if it detects a one-year gap in employment, disadvantaging people who have been on long-term parental leave or are veterans. The software also sometimes uses proxies like a college degree to assign attributes like work ethic, barring people who might have gained those qualities from other kinds of life experience.
This is something many in the recruitment industry have known for years. While hiring software is often useful, it can also be inflexible, miss valuable traits such as soft skills and inadvertently hinder the job market. Smaller companies in particular need to reconsider their growing use of algorithms for finding talent, especially in an increasingly tight job market.
Today’s global labor shortage has, uniquely, coincided with high unemployment rates. In the U.S., for instance, job openings between the fourth quarter of 2019 and May 2021 rose by a third, yet more than 9 million people remained unemployed, according to Deloitte Insights.
But although they were designed to improve hiring, algorithms can exacerbate the talent shortage by rejecting millions of candidates at the outset, according to the Harvard study.
These systems are also at risk of being gamed. For years a popular method for getting through recruitment algorithms has been to fill a resume with key words that are relevant to the job, in white font. That way only the algorithm detects them and pushes them further along in the interview process, potentially over better fits.
Software is getting better at looking out for keyword spam but that doesn’t stop people from trying, according to Lee Tonge, founder The CV Store, a British resume writing agency.
Some colleges are even preparing their students to deal with hiring algorithms. Around 250 universities across the U.S., Canada, U.K. and elsewhere use a startup called VMock Inc. to help their students tailor their CVs with software that will, with a forthcoming update, be able to analyze a job description and then suggest changes to a resume to better reflect what’s wanted.
It could, in theory, help a graduate send out 20 different resumes tailored to 20 different job descriptions, according to VMock’s founder, Salil Pande. But that might also disadvantage other, just as promising, candidates who don’t have access to such tech.
Tools for job seekers will only get more sophisticated. Sami Mäkeläinen, the head of strategic foresight at Australian telco Telstra Corp. Ltd., carried out a skunkworks project last year in which he created a digital human avatar to answer questions to an automated interviewer. The experiment was brief and not an official Telstra project, but it made a startling discovery. The digital avatar scored about as well as a live human who took the same interviews.
A person with programming experience could, in theory, set up a bot to answer interview questions for multiple jobs. “You could easily have them do 100 interviews for you in a week,” Mäkeläinen says. In this case, the more tech-savvy could have an advantage.
There’s nothing new about job candidates putting their best foot forward, but with hiring algorithms working from inside an inscrutable black box, and candidates themselves eager to find ways to circumvent them, the process of filtering applicants looks increasingly messy.
Tonge of The CV Store knows of several small-to-medium sized employers whose recruitment agencies have struggled to find candidates to fill positions, which he thinks comes from an over-reliance on hiring software. “Some companies don’t even know how the [hiring algorithms] are working,” he said. “They might not be aware they’re missing out on good candidates.”
One solution is for companies to resist the temptation to buy futuristic recruitment software that doesn’t have clear ROI. There are some vendors who claim their algorithms can analyze personalities by reading facial expressions and gestures, but much of this tech has been discredited by researchers. Mäkeläinen says they are best avoided.
To be fair, hiring algorithms can be useful. They can ignore gender, race or schooling to help employers seek out a more diverse array of candidates, and large companies especially can justify using them to parse hundreds of applicants.
But employers should take some precautions. The Harvard study suggests audits to ensure algorithms are not inadvertently rejecting perfectly good candidates from the outset.
Tonge has a good recommendation for smaller firms too: If you can, drop the resume screening software altogether. You’ll have a better chance of finding the right people by looking at their resumes yourself.
Dutch Bros Soars In Trading As Dairy Farmer Becomes Billionaire
When third-generation dairy farmers Dane and Travis Boersma were looking for something to do outside the family business, they decided to try coffee. Not only could they make a little money, they’d be able to hang out with friends and listen to music.
They pooled their savings to buy a coffee cart and an espresso machine and began selling in downtown Grants Pass, Oregon, in the early 1990s. Pretty soon they had five carts.
After losing his older brother Dane in 2009 to amyotrophic lateral sclerosis — also known as Lou Gehrig’s Disease — Travis continued building the business. Dutch Bros Inc. now has 471 shops across the Western U.S. with sales of more than $400 million a year.
The company began trading Wednesday on the New York Stock Exchange under ticker BROS. Its share price jumped 48% from the offering price to $34.01 at 12:32 p.m., giving the company a valuation of $5.6 billion. Boersma, 50, is the largest shareholder with a stake worth $2.3 billion, according to the Bloomberg Billionaires Index.
Dutch Bros declined to comment on the size of Boersma’s holding.
With competitors like Starbucks Corp, Dunkin’ and Peet’s Coffee & Tea Inc., the U.S. coffee market would seem to be a tough business to break into. Still, Dutch Bros carved out a niche with a culture it calls “Dutch Luv.” At the company’s stores — all drive-thru — its “broistas” sell more cold drinks than hot, such as the chocolate macadamia-flavored “Annihilator” and the “9-1-1,” which combines six shots of espresso with half-and-half and Irish cream syrup.
The company had net income of $6.3 million on sales of $404.5 million for the 12 months ended June 30, compared with $186 million of revenue in 2018.
Employee satisfaction and advancement are a key company focus, according to the prospectus. The annual turnover rate among Dutch Bros’s hourly employees is 40%, compared with the industry average of more than 100%, according to Bloomberg Intelligence analyst Michael Halen.
“It’s very difficult to hire in the restaurant industry right now,” Halen said, because of the tight labor market. “Retaining your employees helps a lot.”
It also makes for a better customer experience. “You have experienced employees committed to the brand and making a career out of this,” he said.
Boersma stepped down as chief executive officer in February, when veteran beverage-industry executive Joth Ricci took over the role. Boersma continues to be executive chairman.
Private equity group TSG Consumer Partners originally invested in Dutch Bros in 2018, and will continue to own more than 65 million shares after the IPO, making it the second-largest shareholder after Boersma.
How Two Real-Estate Outsiders Landed Jobs Inside Luxury Condo Buildings
A general manager and a cultural-and-lifestyle coordinator share how they ended up working at some of the most exclusive apartment towers in the country.
Q: What Led You To Your Position At An Exclusive Residential Luxury Tower?
General Manager At 53 West 53, New York City
I’m originally from Morocco. I was privileged to have access to his majesty, the king of Morocco, who at the time was King Hassan II. My mother was part of the royal entourage.
I was 16 when I started to work at the palace. Everything has to be done right: even sweeping, even putting down slippers.
It was my responsibility to set up the desk. There is a place where the pen is, where the envelope opener is—everything that is on the desk. If his majesty wants the pen to be put on the middle of the desk, it isn’t because it looks nice but because it’s more convenient. I measured where the pen should be with a little piece of paper.
When his majesty traveled, we took the desk with us—a plexiglass desk with a symbol of Morocco in front. We would go 10 days early and prepare everything. We used to go to the Plaza Hotel and take the whole floor.
You remove the toilets, you remove the TVs, you remove the chandeliers. It’s for two reasons: safety and privacy. You don’t know what’s in that toilet. The only thing you leave is the carpet, and then you put a Moroccan rug down on top of it.
In 1985, I came to America to teach judo, which I was learning while I worked at the palace.
I met the vice president of the Palace Hotel when I was competing on the New York Athletic Club’s team. The next thing I know, I’m working for Leona Helmsley. People called her the Queen of Mean. I said, “No.” I learned from Mrs. Helmsley. She had an eye for detail. If one window blind was 18 inches from the bottom and the other was 21 inches, she would see it from the street.
Later, I worked for the Ritz Carlton company. For 12 years, I opened Ritz Carltons across the world, from Germany to Key Biscayne to Istanbul. I worked for Christian Dior, training their staff. Then one day I got a call: “Can you please come and work with us at 53 West 53?”
When I walked in, the luxury of each inch of the building made me feel like déjà vu, back to Morocco, back to the palace, back to royalty. When you meet the people buying here, it’s not some budget person, it’s someone who wants to enjoy luxury service. It’s about creating a unique and memorable experience every time. I will greet you, I will escort you. I want you to feel you are a very important person.
Back in Morocco, that’s what we learned. All their royalty still know me by name. One of the cousins is proud to say, “Aziz has gray hair because of me.” When they are in New York, I’ll go to the general manager of the hotel where they are staying and say, “Let me help you out, I know what they like.”
Cultural & lifestyle coordinator at Four Seasons Private Residences One Dalton Street, Boston
I worked for 16 years for the French consulate in Boston. With so many prestigious cultural and academic institutions there, my main mission was really to help develop and create the next generation of Francophiles.
Of course, luxury is one element of why you become a Francophile. While I was at the embassy, a film about Coco Chanel came out in France. I did a screening at one of Harvard’s yards. We rented a big screen and brought in a macaron truck and watched it outside.
In 2019, I was ready to do something else, to connect people and promote events for a different industry. I knew the real-estate development team working on One Dalton, which was about to open. The developer was planning a party. I helped them curate a guest list of 800 people, to reach out to the desired audience for One Dalton.
We worked on that for four months. After the party, I had the idea of creating luxury experiences for future residents. The developer liked it and Four Seasons created a position for me. I proposed a sophisticated year-round calendar of events. Then nine months later, the pandemic starts.
‘We brought in an oyster farmer…Naturally, I offered Muscadet.’
Our residents could no longer go to restaurants or museums. I thought, “OK, what we are going to do is bring their favorite things to their doorstep.” Last summer, to give one example, we brought in an oyster farmer. We went door to door and, while keeping socially distant, offered fresh oysters to each resident.
While he’s shucking, he’s talking about where the oysters come from. Naturally, I offered Muscadet. We did it over two or three days. Then for New Year’s Eve, we did it again, with the same shucker, from 11:30 in the morning till 10 p.m. He shucked 750 oysters that day.
In January, we offered classes in fencing with an Olympic coach. I thought fencing would be great—you already wear a mask. It’s the ultimate social-distance sport. Our motto was, “If you have to wear a mask, better come with a sword.” The class was so popular it is now offered as an amenity.
Companies Use Overtime to Solve Worker Shortages. That May Cost Them More Workers
Companies that can’t fill open positions are relying on current employees to log more hours. The risk is that stress and burnout will drive these workers out the door.
Companies that can’t fill their many openings are relying on existing workers to stay late, come in early and pick up extra shifts to keep operations running. That’s making the nation’s current labor shortage even more challenging to solve.
Overtime means bigger paychecks. But it can also create higher stress and burnout. Employers and researchers say the demands for extra time are contributing to a broad wave of resignations sweeping across the country as more U.S. workers quit their jobs than at any time in the last two decades. That, in turn, places even more pressure on remaining employees.
“People won’t put up with it indefinitely,” said Nicholas Bloom, an economist at Stanford University who is studying Covid-19’s effects on the U.S. economy.
The unintended consequences of overtime are one of many factors making it difficult to match employers with potential employees as the economy reopens. That process is proving to be unexpectedly slow and complicated. The number of open U.S. positions surged to a record 10.9 million in July, the most recent month for which government data is available.
In the manufacturing world, production employees worked an average of 4.2 extra hours a week last month, according to Labor Department data. That was up from an average of 3.8 extra hours in August 2020 and 2.8 hours in April 2020.
Some workers are so frustrated with the additional expectations that they are willing to walk away, either permanently or as leverage in negotiations with management. Overtime demands were a primary issue in the recent strikes at Mondelez International Inc., maker of Ritz crackers and Oreo cookies.
At several Mondelez plants, unionized employees pushed back against proposals to lengthen shifts while limiting overtime pay for weekend shifts. On Wednesday, Mondelez announced a tentative agreement with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, but both parties declined to release details about the agreement or comment further.
Some workers are fine with additional hours as long as that means taking home more money. Dani Cobb, a line cook at a banquet hall in Cedar Rapids, Iowa, regularly works around 60 hours a week amid a surge in weddings and meetings and the worker shortage. Right now, the facility has no dishwashing staff, so on any given night Ms. Cobb might prepare and serve a dinner for 250 guests and then stay late to wash stacks of plates.
The extra pay on top of her hourly rate of $15.10 has made it easier for Ms. Cobb, who turns 24 years old Saturday, to move into her own apartment and cover her bills.
“I like it,” she said. “My body can handle it while I’m young so I’m doing it while I can.”
A Dire Situation
Overtime isn’t just a challenge for employees. From railroads to manufacturers to fast-food chains, employers said higher expenses from the extra payouts are biting into their profit margins while productivity suffers.
“The performance of people diminishes over time,” said Jason Berry, a principal at Knead Hospitality + Design, which owns 10 high-end restaurants and bakeries in the Washington, D.C., area.
Under federal law, most hourly workers receive premium pay at one-and-a-half times their regular rate if they work more than 40 hours in a single week. Salaried employees earning more than $35,568 a year are generally not eligible for the extra pay. They often put in extra hours without additional compensation.
Restaurants are on the front line of this overtime predicament. At Carrols Restaurant Group Inc., which owns and operates more than 1,000 Burger King and Popeyes locations, overtime added about 1.5 percentage points to overall wage inflation of 11.9% in the second quarter, the company said on an Aug. 12 conference call.
The company’s chief executive, Dan Accordino, told analysts on that call that his primary focus is reducing overtime because “you don’t get much benefit for that at all. You are paying 50% more for less productivity.” Company representatives didn’t respond to requests for comment.
At Knead Hospitality + Design, Mr. Berry said his overtime cost is currently about 50% to 100% higher than it was in 2019 for the restaurants that were open in both periods. He and his managers examine overtime reports every day, and he said they manage it so that overtime pay is an intentional, not accidental, expense.
“If a grill man is making 100 steaks over an hour and generating thousands of dollars of revenue, there’s no argument that you needed that hour,” he said.
RK Industries LLC, a 1,400-person construction and manufacturing firm based in Denver, is using overtime to add the equivalent of 60 to 100 full-time employees to its capacity every week, said co-owner Jon Kinning. That is around 2,500 hours, or 7.3% of all hours worked.
RK could fill more overtime hours, Mr. Kinning said, but not everyone is willing to take the extra shifts. And with wages rising, many don’t have to. Entry-level pay at RK in the last few years has gone from $12 an hour to $16 and may soon go up to $18. “When they were making $12 an hour, that extra $6 makes a difference,” he said.
To alleviate the overtime crunch, Mr. Kinning has hired more recruiters and boosted RK’s education benefits. He said he is also thinking of creative ways to market the company’s apprenticeship programs, which are designed to help with the training of unskilled workers into skilled tradespeople.
But RK is turning down work it could otherwise take on because it doesn’t have enough people and isn’t willing to push existing workers further.
“If I could hire 400 people tomorrow, I could grow my business,” he said.
Understaffing is particularly acute in healthcare. Providence, a Seattle-based health system with 120,000 employees and more than 1,000 hospitals and clinics, tries to keep overtime at 2% or less of its overall workforce spending, in part to avoid overtaxing its clinical staff, said Greg Till, Providence’s chief people officer.
For most of the pandemic, Providence met that goal, but the figure rose to 3.8% in July before falling in August to 3.3%.
“The situation we’re in right now is pretty dire,” Mr. Till said. “With Delta and the slowing of vaccination rates, many of our hospitals are in an untenable situation where we can’t staff the way we need to.” At a small number of facilities, Providence has had to delay or defer care for patients, he said.
The nonprofit health system is investing $220 million to recruit 17,000 new employees and reward its current workforce with bonuses and other benefits. “Burnout is a significant issue,” said Mr. Till. “We’re not as much focused on the cost [of overtime] but on the impact it has on caregivers.”
A Tough Choice
The question of when and how to ask workers for extra time is the source of increasing tension as pressure builds to fill the gaps created by higher demand. Companies can require employees to work overtime, and people who refuse might be disciplined.
One worker who often faces this choice is Jose Ramos, a forklift operator for glass and metal producer Ardagh Group in Valparaiso, Ind., who said he worked more than 600 hours of overtime last quarter and still often puts in 72-hour weeks.
To staff five-person crews, Mr. Ramos’s managers often ask for two or three overtime volunteers. If not enough people raise their hands, workers who incurred the fewest overtime hours that week are required to step up, he said. Refusing the request can lead to a write-up.
“Some days I volunteer and some days I’m forced. I don’t mind it, but at the same time I’d love to not work as much. I have a daughter, and I’d like to go home and spend time with her,” said the 24-year-old.
A spokesman for Luxembourg-based Ardagh said the increases in overtime opportunities at certain plants are “consistent with all applicable safe working requirements” and in line with union contracts.
Employment lawyers are monitoring whether employers always track all of those overtime hours and pay their eligible employees for them. In a survey conducted by payroll firm ADP Inc., U.S. workers reported putting in an average of 8.9 hours a week of unpaid time in January 2021 compared with four hours a week a year earlier. The survey didn’t specify what share of those workers are eligible for premium pay.
Michele Fisher, a partner at law firm Nichols Kaster PLLP in Minneapolis, said she has been receiving more inquiries about a possible overtime violation called off-the-clock work, where employees’ time isn’t logged for work activities outside their scheduled hours.
In many companies, she added, workers have to meet rising performance or production goals in 40 hours, and must seek pre-approval for overtime. Sometimes “that pre-approval is not being given or is being shamed, like you should be able to do this job in 40 hours a week and so maybe you’re not cutting it.”
She said it is difficult to determine whether overtime violations are rising because a majority of employers now require workers to bring their claims through confidential arbitration proceedings rather than through the public court system.
Chelsea Dwyer Petersen, a partner focusing on employment litigation at management-side law firm Perkins Coie LLP in Seattle, said there is no groundswell of litigation yet, but she expects to see more cases or complaints in 2022 as the pandemic continues.
Another lawyer, Mark Berry, co-chair of the employment services group at law firm Davis Wright Tremaine LLP, said companies are balancing many competing demands: “They’re out there trying to hire as best they can, and fill the roles, and get people trained, and all of those things that would try to alleviate some of the stress but it’s difficult, particularly in lower-wage industries to get people to fill those roles these days.”
Either way, the need for more work from existing workers shows no signs of abating. “GDP is miraculously above its pre-pandemic level but we have five or six million less employees, so each person is generating more output” than before the crisis, said Mr. Bloom, the Stanford economist.
“This will involve working harder per hour, so less breaks, more intensity and more stress, and also more hours.”
Miners Labor To Find Enough Truck Drivers, Workers
Big bonuses, swimming pools and gourmet dinners are rolled out to attract staff as border restrictions curb mobility.
The hottest commodity in Australia’s biggest mining province comes with a driving license and a willingness to work 12-hour shifts under a baking desert sun.
Western Australia, the world’s main source of iron ore and a significant producer of gold, is so short of truck drivers that some companies are pressing retired soldiers and furloughed airline pilots into service on mine sites, or offering gourmet meals and building Olympic-size swimming pools to attract more workers.
Competition for skills is driving up wages, adding a new layer of costs and supporting metals prices. For miners unable to find enough workers, projects designed to meet the next wave of commodities demand are being delayed.
“The key thing that we’ve got to do is we’ve got to be able to get fresh people into Australia,” said Chris Ellison, managing director of Mineral Resources Ltd. , which produces iron ore and lithium.
The Covid-19 pandemic is exposing vulnerabilities in the global mining industry that has long relied on open borders to operate efficiently.
For years, mining companies shuttled specialist staff around their operations. But that tradition is coming under pressure as those companies face difficulties obtaining travel exemptions for workers, requirements to quarantine on arrival and challenges finding enough accommodation.
The skills shortage is especially acute in Western Australia, which is one of the few remaining provinces in the world with zero Covid-19 cases locally. Mark McGowan, the state’s premier, has signaled the border could stay closed to much of the rest of Australia until April because of Covid-19 outbreaks elsewhere.
But it is also a growing problem in other countries, including Canada and Mongolia, where producers are balancing rising metals demand as the global economy reopens with challenges to get enough workers, including drillers and geologists.
Even in places where borders are open, such as the U.S., mining executives say some staff are refusing to relocate from countries including Australia that until recently had largely escaped the worst of the pandemic.
Labor shortages aren’t confined to mining. In the U.S., employers in sectors like manufacturing, restaurants and construction are struggling to find workers. For many countries, the shortages threaten to restrain what are otherwise shaping up to be robust post-pandemic economic recoveries.
Western Australia truck drivers—who typically earn more than $100,000 a year—play a vital role carrying gold-rich ore from deep underground or truck liquefied natural gas to mines to power operations.
To win the skills race, Roy Hill Holdings Pty Ltd. is banking on financial incentives and even offering Wagyu beef and vegan meals on menus to make living at a remote mine more attractive. The iron-ore producer said its truck drivers, among others, will this year receive bonuses worth roughly 50% of their base salary.
Roy Hill said it recently agreed to a deal with Qantas Airways Ltd. to employ some long-haul pilots while international travel remains restricted. Australia’s border remains closed and Qantas doesn’t expect it will resume flying internationally until at least December and, when it does, that the reopening will be gradual.
“If you’re an international pilot, you’re used to 12-hour shifts,” said Gerhard Veldsman, Roy Hill’s chief executive. “A big, Hitachi 300-ton truck fully loaded weighs basically the same as an A-380 plane.”
This year’s commodity bull run has encouraged miners to search for more metals or seek to raise output, which needs workers. Also, many companies are catching up on maintenance work deferred at the start of the pandemic.
Western Australia’s mining and resources industry could need as many as 40,000 more workers by mid-2023, when the required labor force is estimated to peak above 170,000 people, says the Chamber of Minerals and Energy of Western Australia, an industry group.
Still, without overseas arrivals, Western Australia risks falling as many as 33,000 workers short, said Rob Carruthers, the industry group’s policy director.
So, industry representatives intend to lobby authorities for a dedicated quarantine facility that could accommodate resources workers from overseas.
Mineral Resources shipped roughly 14% less iron ore than it expected in the year through June, as a shortage of truck drivers deepened. Trucks that can operate 24/7 sat idle as surging iron-ore demand sent prices for the commodity to a record high.
Unlike major rivals Rio Tinto PLC and BHP Group Ltd. , which spent decades building vast rail networks on which trains snake through the Australian Outback, Mineral Resources relies heavily on trucks to get its ore from its pits to ports with a fleet of 225 road trains that travel roughly 40 million miles a year.
Mineral Resources is trying to make its remote worker villages feel more like resorts than camps. It is planning Olympic-size swimming pools, bigger rooms and wants to encourage couples to work and live together on site.
Keeping workers happy is crucial in Western Australia, which is roughly a third of the size of the contiguous U.S. Many mines are hundreds of miles from large towns, and summer temperatures can top 104 degrees Fahrenheit.
South32 Ltd. , a metals and coal miner, is redesigning shifts at some operations to include short, middle-of-the-day stints that would suit parents, among other measures. Still, Chief Executive Graham Kerr said poaching of workers has become rife in Western Australia.
“They’ve said: You’re getting paid X? We’ll give you X times two,” Mr. Kerr said of some miners. “If you are young in your career that would be a great opportunity.”
Men Are Losing Their Grip In The New Economy
Job growth and education are putting women in a prime position to dominate. Should we rejoice or worry?
It’s no longer a man’s world. Pundits have speculated for more than a decade about the end of men. After centuries of dominating the economy, most of the job growth is in industries where women traditionally work. And those jobs require more education. The latest piece of data is that women are dominating college enrollment. In a few years, two women will earn a degree for every one man.
On the one hand it’s tempting to say … finally. Women were effectively shut out of the labor force for decades and still earn less. And it’s worth noting that men are still well-represented in STEM degrees at college and universities, which tend to lead to higher-paying jobs. But the economy is not zero sum, and a large population of men falling behind doesn’t help anyone. Men with lower earnings prospects and less education are less likely to marry.
And to make matters worse, coming from a single-parent household lowers the odds a boy will go to college (the impact on girls from single parents is not as profound), creating a vicious cycle of single parenthood and more men not going to college.
There are many reasons other than family structure to explain why men aren’t pursuing higher education. Some young males don’t see the value in taking on lots of debt to learn esoteric concepts that don’t relate directly to a job. And to be fair, some schools don’t provide good value.
The Atlantic’s Derek Thompson argues young boys are more likely to struggle in school, so it’s not surprising they don’t want to take on more years of it. He also points to research suggesting boys have less ability to delay gratification.
And this is a big problem. The economy is evolving and post-secondary education is becoming a prerequisite to a stable middle-class life. There are enormous wealth disparities between people who go to college and those who don’t. And we can see the impacts of this long-running trend.
Less-educated men are not only in lower-paid jobs, but many also aren’t working at all. In 1992 about 72% of male high-school-only graduates older than 25 were employed. Just before the pandemic only 64% had jobs, and it’s only gotten worse in the last 18 months: Last quarter, only 61% of male high school graduates were employed. Each recession removes men from the labor force and they don’t come back.
This is not only devastating economically and socially, but it’s also bad for health. Anne Case and Angus Deaton’s book about the future of capitalism estimates people without college degrees are more prone to drug addiction, suicide and early death.
Changes in technology and trade mean the economy has evolved where most of the job growth is in the sorts of jobs that women have traditionally worked in, such as caregiving and education, and many of the better jobs in those fields require some post-secondary training.
We see women dominating at all levels of education in these fields; there are more women than men in medical school and earning Ph.Ds. As women take over the fastest-growing industries, it seems inevitable that a population of men who don’t go to college risk becoming trapped in a permanent underclass.
But believe it or not, men have struggled in the labor market before. According to Northwestern University economic historian Joel Mokyr, before industrialization most people were farmers and independent artisans — think tailors and silversmiths. They mostly worked from home and set their own hours. When jobs moved to factories in larger towns and cities, men had a hard time adjusting to being told where to be and what to do.
At first, factories hired women and children because they were more compliant and better suited for the structure of the industrial economy. One reason for universal schooling was to condition boys to one day be factory workers who could take direction from a boss and stick to a schedule.
That suggests men can adjust to this economy, too. Admittedly, last time it took nearly 100 years and caused lots of social strife along the way, but there are things we can do to speed this process along. First, thriving in the new economy means accepting how it’s changing rather than fighting it.
That will involve, in some ways, going back to the independent-worker model that existed before industrialization. Well-paid, unionized manufacturing jobs that only require a high school degree aren’t coming back, and efforts to restore the old economy with reshoring or a jobs corps won’t help men — it only keeps them trapped in the 1960s.
Instead, we need to allow for a more dynamic economy that allows for independent work, including providing benefits to contract workers, and reducing the number of non-compete contracts and unnecessary licensing requirements. These steps would empower men without college degrees to pursue work in a modern economy, unconstrained and on their own terms.
We can also provide more education options that feel more relevant and offer immediate value. The Biden administration’s current budget plan offers free community college. But community college doesn’t have a great track record at preparing people for work, in large part because it traditionally was meant to prepare people for four-year degrees instead of jobs.
A better solution would entail more apprenticeships, sectoral employment programs and reviving trade schools at the high school level.
Also, most critically, we must respect all jobs and drop elitist talk that presumes some work is pointless or that some jobs are less prestigious because they didn’t require a college degree. After all, a good plumber often can earn more than an average lawyer. More women in college may not signal the end of men as much as it signals an economy in transition, where some men will flounder and others will find a way to adapt and thrive.
Stripe Plans Hiring Push In London Ahead Of Potential IPO
Stripe Inc. is planning to hire dozens of new employees for its London office next year as part of a broader expansion in Europe ahead of the payments company’s potential initial public offering.
The company aims to make London its fintech office, said Matt Henderson, business lead for Europe, Mideast and Africa, in an interview. “We’re a company that has always had these European roots, but it’s just becoming more and more important.”
Stripe, whose founders are Irish and has headquarters in Dublin and San Francisco, was last valued at $95 billion and may go public as soon as next year. It started adding engineers in London about a year ago and now has nearly 200 employees in the office. It’s hired dozens in the city in the last year and plans to keep at least that pace into coming year, Henderson said.
The office in East London’s startup hub will also work on expanding products for non-financial companies, bank integrations like transfers, and open banking. London-based engineers are planning to pilot a “pay-by-bank” feature next month.
Stripe has also said it’s planning to add hundreds of software engineering jobs in the Irish capital in the next few years.
CVS Makes Hiring Push (25,000 New Jobs) Amid Worker Shortage, Increased Covid-19 Vaccine Demand
Pharmacy chain plans to add 25,000 people this week as stores struggle with long lines, frustrated customers.
CVS Health Corp., one of the biggest U.S. providers of Covid-19 tests and vaccines, is racing to hire thousands of workers as staffing shortages prompt stores to close drive-through lanes and at times turn away customers seeking shots.
The largest U.S. pharmacy chain by stores said it plans to add 25,000 employees this week in a single-day hiring spree to prepare for a potential surge in demand from booster shots and as more people seek Covid-19 tests and flu vaccines.
CVS employees and customers at some locations have described chaotic stores, hourslong lines and phones that go unanswered as the chain addresses a national labor shortage. Companies in sectors from retail to manufacturing are having a hard time filling jobs, leading to deteriorating service, production slowdowns and burnout among staff.
The worker shortfall at CVS, also hitting rival Walgreens Boots Alliance Inc., is being exacerbated by rising demand for Covid-19 tests as people begin to seek flu vaccines ahead of what health officials predict will be a severe influenza season.
“This is testing our role in the community,” said Neela Montgomery, who has been president of CVS’s pharmacy retail unit since November. “But provided we staff up the way we intend to, we’re going to make our way through this.”
Ms. Montgomery said CVS is administering more tests than it was at the height of the pandemic as Covid-19 cases rise and as more employers, schools and other entities require unvaccinated workers, students and customers to produce negative test results.
Demand for flu shots is already higher than usual, she said, and the company didn’t initially anticipate that the booster-shot rollout would converge with flu season. A U.S. Food and Drug Administration advisory panel on Friday endorsed booster shots of the Covid-19 vaccine for adults older than 65 years and those at high risk of severe disease.
CVS employees, in interviews and posts on social media, have described short-staffed pharmacies, customers lashing out during long waits and workers quitting out of stress.
Kate-Madonna Sieger, of Lakeville, Minn., said that when her 9-year-old son exhibited potential Covid-19 symptoms a few weeks ago, she visited three CVS pharmacies and each said there was no pharmacist on duty to administer a test. Ms. Sieger, 39, who is receiving treatment for breast cancer, also said she received an expired, but ultimately harmless, prescription last month from the CVS she regularly frequents.
“I called the pharmacist to ask him how this could have happened and he said, ‘We’re really short-staffed, and we’re really sorry,’” she said. “I have nothing against CVS but that’s concerning.”
A CVS spokesman said staffing issues aren’t systemic.
“We’re always going to have in pockets some staffing issues that may unfortunately cause some service issues,” Ms. Montgomery said. “But we are very focused on deploying district and regional teams to support those stores when they are understaffed. That is one of the advantages of having 10,000 stores.”
Walgreens, which has shortened store operating hours in some cases because of staffing shortages, on Friday announced cash awards to pharmacists and pharmacy technicians. A company spokeswoman said Walgreens overall had had, “minimal disruption.”
The company will pay $1,000 “certification awards” to be paid out over a six-month period to pharmacy technicians who are or become certified to administer flu and Covid-19 vaccines, along with bonuses of $1,250 for full-time pharmacists and $1,000 to part time pharmacists.
The U.S. has relied heavily on retail pharmacies for nationwide Covid-19 testing and vaccine distribution through a federal partnership with nearly two dozen retail pharmacy chains, including Walmart Inc., Kroger Co. and Rite Aid Corp., as well as CVS and Walgreens.
The participating companies have administered roughly one-third of the more than 300 million doses administered since vaccines became available at the end of 2020, according to the U.S. Centers for Disease Control and Prevention. CVS and Walgreens, with some 19,000 U.S. locations between them, have delivered the bulk of those shots. CVS said it has given 34 million doses to date.
The CDC said in a statement that the agency is working closely with pharmacies to ensure they are prepared to administer booster and flu shots this fall. It said unlike at the height of the pandemic, supply isn’t a problem, and providers are well-versed in storing and administering shots.
CVS, more than other chains, has expanded the size and scope of its pharmacy business in recent years. The chain has begun offering medical services from diagnostics to mental-health counseling in stores. It also has taken on more business as regional and grocery chains go out of business.
CVS has taken steps to attract more workers. The chain in August said it would raise its minimum hourly wage to $15, with increases starting this summer and fully implemented by July.
The company also said it would eliminate the grade-point-average requirement for university recruitment this year. It has done away with the high-school diploma or General Education Development requirement for most entry-level roles.
Walgreens also has announced plans to raise starting pay to $15 an hour, beginning in October and fully implemented by November 2022.
Ms. Montgomery, CVS’s pharmacy chief, said the company encourages retail employees to enroll in its pharmacy technician training program in an effort to expand the pool of workers.
The hiring event, planned for Friday, aims to fill 19,000 open positions while adding another 6,000 jobs at roughly 10,000 locations nationwide.
Pharmacy technicians will comprise 14,000 of the new hires, with the remaining jobs going to pharmacists, nurses and retail workers. CVS’s pharmacy operations, which include distribution centers, operational roles and clinics as well as store and pharmacy workers, employ 200,000.
Job seekers can start the application process via text or on the company’s website, try out for the job virtually and potentially get hired immediately, the company said. CVS isn’t accepting in-person applications.
Pharmacy technician wages start at $16 an hour. Pharmacy techs make $17.50 an hour on average in the U.S., with higher pay going to those who work in hospitals, according to the U.S. Bureau of Labor Statistics. A pharmacy tech working at a retail setting makes $16.55 an hour on average while the same job in a hospital averages $19.80 an hour.
Tesla Is Building A New Battery Factory In California
A California mayor said Tesla Inc. broke ground in his city on what it calls a new “Megafactory,” praising the planned facility in a Facebook post that was deleted and is now visible again.
“We are proud to be the home of the Megafactory, Tesla’s most recent expansion here,” Lathrop Mayor Sonny Dhaliwal wrote in the post. “The future of green energy will be produced right here in our community.”
The plan is for a factory expansion to make Megapacks, the energy-storage product Tesla sells to utilities. Lathrop, in San Joaquin County, has long been home to the company’s warehouses and logistical operations. Tesla’s flagship U.S. auto plant is in Fremont in neighboring Alameda County. The company is based in Palo Alto.
Tesla, which currently manufactures battery packs at a plant in Nevada, didn’t respond to a request for comment, and the mayor’s office didn’t respond to questions about why the original post was taken down.
An expansion in Lathrop, a city of more than 24,000, would be a good sign that California is still a key part of Tesla’s footprint.
After Chief Executive Officer Elon Musk moved to Texas in December and criticized California policies, there was concern Tesla’s operations might leave the state. The company is building a new factory for production of the Model Y and Cybertruck in Austin.
While Tesla is known for its electric vehicles, it’s always been more than a car company: Its official mission is to “accelerate the world’s transition to sustainable energy.” Utility-scale batteries are needed to store the electricity produced by wind and solar.
PG&E Corp. and Tesla have constructed a 182.5 megawatt system at an electric substation in Moss Landing, near Monterey, that should be operational later this year.
Amazon’s Early Pandemic Hiring Spree Mostly People of Color
Three of every five workers Amazon.com Inc. added to its rolls in the U.S. during the year ended October 2020 were people of color in laborer jobs, suggesting the company weathered the pandemic’s surge in online shopping thanks to members of racial groups that are underrepresented in the retailer’s corporate ranks.
The statistics come from reports for 2020 and 2019 that Amazon provided the government, which were posted Wednesday on the company’s workforce data web page. Employers are required annually to submit that data, which breaks down their U.S. workforce by racial and gender groups and standardized job categories, to the federal Equal Employment Opportunity Commission.
In the past two years, Amazon has publicly laid out diversity goals aimed at making the company look more like society as a whole, including increasing the number of women in senior technical jobs and doubling the number of high-level Black employees. The company is also facing several lawsuits from women who have alleged harassment, discrimination and retaliation. Amazon has denied wrongdoing.
The Seattle-based e-commerce giant employed about 379,000 more people in the U.S. in October 2020 than it did a year earlier, according to the reports. Some of that figure likely reflects regular hiring, but the time period also coincides with a few highly publicized hiring surges in Amazon’s logistics ranks as the company sought to keep up with overwhelming demand from newly homebound shoppers.
Black, Hispanic, Asian, and other minority “Laborers & Helpers” accounted for 61% of the additional employees, the data show. Advocates for better racial and gender representation in corporate America have pushed for companies to proactively release that data. Amazon previously made public some of the forms, known as EEO-1, but stopped the practice after data covering 2016.
Since then, the company has added almost 800,000 U.S. employees, becoming the second largest U.S. employer after Walmart Inc., which has pledged to make public its EEO-1. Amazon has also periodically posted workforce demographic data using its own categories for employees.
The federal data show Amazon is far more diverse in its warehouses than the technologists, product designers, and other professionals in its corporate ranks, where the vast majority of employees identify as White or of Asian descent. Black employees in 2020 accounted for about a third of Amazon’s employees in the “Laborers & Helpers” category, but 11% of managers, and 3.6% of executives.
Still, the latter figures represent an increase from 2019. People of color accounted for 42% of the additions to Amazon’s executive ranks in 2020.
Women made up about 46% of Amazon’s total U.S. workforce in 2020, including about 29% of people in Amazon’s managerial and executive ranks.
Amazon last year told New York City’s Comptroller that it would release its EEO-1 form, one among dozens of companies that agreed to greater transparency following a pressure campaign by the office that oversees the city’s pension funds.
Mothers Are Postponing the Return to Work. Amazon and Other Companies Are Trying to Bring Them Back
Among other things, employers are making re-entry easier and increasing child-care support.
Working hasn’t worked well lately for many U.S. mothers.
About 3.5 million mothers living with school-age youngsters lost their jobs, took leave or left the labor market when Covid-19 hit last year, Census Bureau data shows. Now, increased Covid-19 cases are causing some schools in hundreds of districts to bring back virtual learning—and burden mothers again.
“Many women will delay their plans to re-enter the workforce even further,’’ says Amanda Augustine, a career coach and spokeswoman for TopResume, a resume-writing service. In a spring 2021 survey, TopResume found that 69% of 362 women employed pre-pandemic but currently caring full time for children under 18 plan to stay home for now.
Facing a brain drain and labor shortages, some companies are responding not just by hiring more women with children. They’re going to unusual lengths to assist mothers’ re-entry into the workforce, address their desire for flexibility and offer them more child-care support.
If employers change work cultures and practices to attract mothers and other people forced to give up work and assume caregiver roles during the pandemic, that “could be a real game-changer,’’ says Brigid Schulte, director of Better Life Lab, a work/family research group at the New America think tank. These potential future workers, she says, represent talent and experience “that companies can’t afford to toss aside.”
About 40% of employers beefed up child-care assistance during the pandemic—mostly through remote work and flexible schedules, U.S. Chamber of Commerce Foundation researchers found.
Still, only 1% of employers provide direct support such as backup child care or on-site facilities, according to the foundation’s August 2020 report. But half of parents surveyed said they view direct support as important to decisions about fully resuming work.
Here’s A Closer Look At Several Innovative Strategies That Could Make Work More Workable For Mothers:
Amazon.com Inc. recently made the biggest-ever commitment by a single employer to the long-nascent idea of “returnships.” These are paid tryouts that often attract stay-at-home mothers and result in permanent spots.
In a June news release, the online retail giant says it will choose 1,000 professionals for its U.S. returnship program “over the coming years.” Participants must have been jobless or underemployed for at least a year, and work 16 weeks remotely in roles such as financial analyst and software-development engineer.
Fifty-four of Amazon’s 61 present returnees are women. “This is a great way to create a recruitment pipeline for mothers,’’ says Alex Mooney, the company’s senior diversity talent acquisition program manager.
Arnetta Alexander is one of those women. A senior financial manager who was unemployed when she learned about Amazon’s extensive returnships, she says she told herself, “OMG, I have to try this.’’
The eight-year veteran of energy company DCP Midstream LP lost her job in April 2020 as the pandemic spread. While out of work, Ms. Alexander was overseeing her eighth-grader’s remote education when she began a job search in January 2021. For months, she got nowhere.
“I was willing to take anything,” she says. The 47-year-old manager, who holds two master’s degrees, became one of Amazon’s returners on July 19, working in accounting from her Riverside, Calif., home. An assigned Amazon mentor suggested ways to ease new-job jitters and make things work with a supervisor three time zones away on the East Coast.
“My returnship has been a real positive experience,’’ Ms. Alexander says. She hopes she’ll win a permanent professional position at Amazon when her temporary stint ends in November.
Lori Taylor spent more than six years raising two daughters before her 2015 returnship at Goldman Sachs Group Inc.“My returnship was such a good fit that I got up to speed and provided value to my team quickly once I joined Goldman full time,’’ Ms. Taylor says. She subsequently became the Wall Street firm’s first returnee promoted to managing director.
Eager to attract mothers and others displaced by Covid-19, Goldman changed its program’s qualification policy to require a career break of just one year—half of what was required before. Five other businesses made identical moves during the pandemic, says Carol Fishman Cohen, chief executive of iRelaunch, a career re-entry consulting firm.
She expects 80 Fortune 500 companies will offer returnships by 2026—up from 32 today and 12 in 2016.
Path Forward, a nonprofit that creates returnship programs for employers, has helped about 90 companies since 2016. Four out of five returnees have landed full-time jobs, says Tami Forman, the nonprofit’s executive director.
Advancement assistance for remote staffers
Experts warn that employed mothers who work from home risk decreased access to company leaders and opportunities. This could pose a significant problem, since nearly 52% of 781 surveyed mothers said they preferred to keep working completely from home after the pandemic ends, according to a summer 2021 poll by FlexJobs, an online job service. That was up from 47% in 2020.
PricewaterhouseCoopers LLP wants to make sure its remote workers don’t become second-class corporate citizens. The professional-services giant will monitor promotions, raises and bonuses for remote and office-based staff, said Tim Ryan, U.S. chairman and senior partner, during a spring 2021 interview.
“If we see any group that is lagging,’’ he said, “it is going to cause us to question: ‘Why should where you work define your success? It should be performance based.’’’ A PwC spokeswoman said results from their tracking aren’t available yet.
In a study released in August, PwC urged employers embracing hybrid arrangements to reduce “the risk of remote work inequity.” Bosses should give remote individuals tools like virtual-reality headsets and encourage participation during digital sessions with in-office associates, the study recommended.
Certain businesses have demonstrated their commitment to mothers by extending recruiting to women who are expecting.
Workhuman, an employee-engagement platform with 734 staffers, has brought aboard at least seven pregnant applicants since 2019. Three of those women started work just before they gave birth—including Amy Rice, currently Workhuman’s senior director of corporate communications.
She recently hired a senior manager who started work during her ninth month of pregnancy. The newcomer told Ms. Rice that disclosing her condition had cost her opportunities elsewhere. She returned from her 12-week maternity leave Sept. 7.
“I want to continue to pay it forward” by picking qualified expectant applicants, Ms. Rice says. “Rather than worry about the stage of their pregnancy, more employers should hire women for who they are and who they can be.’’
Similarly, Stephanie Synclair inaugurated a drive to employ single mothers like herself soon after she launched La Rue 1680, a luxury-tea startup, last fall.
The fifth single mother she recruited starts Oct. 1 as a product developer, working full time from home. (In addition to the five moms, the startup has two male employees.)
“I hire moms because I am a mom,’’ says Ms. Synclair, who is raising a teenage son. “We understand what each other is going through.’’
Expanded Child-Care Help
Margaret Keane, then chief executive of Synchrony Financial, took creative steps during the pandemic’s initial months to alleviate child-care crises among the majority-female workforce at the consumer-financial-services provider. Those with young families needed assistance handling “an enormous amount of uncertainty, stress and nervousness,’’ Ms. Keane says.
As countless child-care facilities closed, she increased backup child-care benefits to 60 days annually from 10. She also broadened Synchrony’s definition of covered caregivers to include neighbors, friends and relatives.
For the summer of 2021, Ms. Keane and colleagues quickly devised a virtual day camp where 3,700 offspring of employees attended sessions on subjects ranging from crafts to sign language. Synchrony offered after-school tutoring this past school year and various virtual activities for children this summer. (In April, the CEO switched to executive chair.)
A fresh headache looms, however. About 85% of Synchrony’s U.S. employees want to keep working from home part time once offices reopen, says Carol Juel, chief technology and operating officer. Many will only require occasional child care.
Yet child-care facilities sometimes demand full-time commitments. So, facility operators and Synchrony are exploring actions that best meet its workers’ needs, Ms. Juel adds.
Wellthy, an online provider of care advice for families, may have a remedy. This spring, dozens of businesses asked Wellthy about possibly assisting their hybrid staffers in finding a shared nanny or child-care slot, such as by matching parents with co-workers in the same predicament.
Despite delayed office reopenings, Wellthy recently launched a shared-care pilot for a major financial-services company to prepare that business for a potential hybrid return-to-work arrangement on a larger scale in coming months, says CEO Lindsay Jurist-Rosner. “The shared-care approach,” she says, “ultimately will prove a really smart solution for businesses with hybrid workplaces.’’
Community Colleges Are An Agile New Player In Job Training
Millions of Americans rely on the traditionally low-profile institutions for fast, skills-focused education that pays off in the labor market.
When Arona Coelho arrived in the U.S. from India just weeks before the onset of the Covid-19 pandemic in early 2020, the only job that she could find was as a nanny. She was 35 years old, looking to make a new life, and heard from people in her church in Herndon, Va., about growing demand for healthcare workers.
They also told her that the best, quickest way to a job was through a community college. “They said the training would be fast,” she recalls, “just the skills I needed for a job, and that many employers recruit workers from community colleges.”
It took Ms. Coelho three months to save the $3,200 tuition for a short, job-focused program at Northern Virginia Community College. Training to qualify as a certified clinical medical assistant took four months, with online classes in the evenings and lab work on Saturdays.
There was no question of a degree—she was in too much of a hurry for that. And as soon as she finished the program, she landed what she considers a dream job in a local pediatrician’s office.
An estimated 3.7 million ‘noncredit’ learners currently attend U.S. community colleges, enrolled in skills-focused programs that do not grant degrees.
Ms. Coelho is one of an estimated 3.7 million so-called “noncredit” learners who currently attend U.S. community colleges. They are largely invisible to the federal government, which keeps copious data on every other kind of college student, including community college students working toward degrees.
Noncredit learners are enrolled in skills-focused programs that do not grant degrees, and they are usually ineligible for federal financial aid.
Credit and noncredit programs at community colleges play an essential but often unrecognized role in job training, as my nonprofit organization discovered in a recent survey. In fall 2020, we invited all of the nation’s 1,100 community and technical colleges to participate.
By this spring, 477 had responded, providing detailed data about their students, programs and relationships with employers. Our findings paint a picture of a vibrant, evolving sector.
For most of their history, community colleges have lived in the shadow of traditional four-year colleges and universities. Many people saw them as a less distinguished, more affordable stepping-stone to a bachelor’s degree.
Even community college educators often underestimated their institutions’ potential, seeing them primarily as feeders to four-year schools, focused on the same traditional, academic mission.
But that is changing as automation and business restructuring upend the labor market. Technology is shortening the half-life of skills and increasing demand for skilled technical workers. With fewer good jobs available for people with only a high school diploma, many students who could once get by without college are looking for fast, skills-focused programs that will pay off in the labor market.
People displaced by robotics and artificial intelligence need short, targeted bursts of training that enable them to return to the workforce as quickly as possible. And as the pace of change quickens, workers at all education levels may need to return to school later in life, learning new skills to keep up with the evolving economy.
In response to these trends, many of the nation’s community and technical colleges are pivoting to put job-focused education more at the center of their mission and culture.
According to our survey, more than half of the country’s 11 million community college students are in programs designed to prepare them for the workplace. Among noncredit students, nearly 60% are job-focused, and nearly 75% are 25 or older.
For many students, especially older learners, community college holds out hope of a second chance. Mark Gilson of Woodside, N.Y., grew up around animals and wanted a career working with living creatures. He went straight to college after high school, planning to get a bachelor’s degree in zoology, but when he flunked out of chemistry he switched to a humanities major.
College led to graduate school and two degrees in the fine arts; then he worked off and on for 20 years as a commercial designer. But finally, in his late 40s, his youthful dreams caught up with him and he decided to go back to school to qualify as a veterinary technician.
Unlike Ms. Coelho, he wants a degree. “There’s just so much to learn to pass the national licensing exam,” he says. “You need to prepare as well as possible.” This time around, he bore down on a required chemistry course and is on track to graduate from LaGuardia Community College in December.
Among the biggest challenges for community colleges is keeping up with the changing labor market. Precision machining skills, no matter how advanced, have no value in a region where there is little or no manufacturing. And the coding language in demand five years ago is unlikely to command top dollar in today’s job market.
Many colleges use labor market data—government data and information about job postings—to track what occupations are in demand in their area. But the best way to stay current is by asking local employers or, better yet, partnering with them to provide instruction.
Employers can supply information about industry trends. They often collaborate with educators to design programs. In the closest and most intensive partnerships, they commit to hiring graduates and help the college to improve instruction by providing feedback on their skills.
More than 90% of the community colleges that responded to our survey said they designed or regularly revised programs on the basis of employer input. And at many schools, it’s the noncredit division that maintains the strongest industry partnerships.
Unlike slow-moving academic departments, which often need up to two years to get approval for a new program, noncredit instructors can respond in real time to changing demand from employers and job seekers.
Another way that community colleges keep up with the labor market is by preparing learners to pass skills assessments developed by employer groups. For both Ms. Coelho and Mr. Gilson, the road to a job led through a test administered not by the college but by a national industry association.
According to our survey, between a quarter and a third of noncredit workforce students earn credentials—licenses and certifications—awarded on the basis of third-party tests.
Some state governments are out ahead in promoting innovation at community colleges, but federal policy makers lag far behind. President Biden is rallying Democrats with a call for free community college, but what most proponents of the measure have in mind is traditional academic instruction leading to a degree or other academic credential.
What’s needed most at the federal level is reform to make Pell Grants and student loans available to noncredit learners like Ms. Coelho, as well as data collection on noncredit programs to ensure quality and encourage innovation.
With or without these policy shifts, the new economy is driving change at community colleges. Lauri Byrne went straight from high school to college as a star soccer player, but she was so consumed by athletics that she left without a degree.
When hopes of a professional sports career faded, she traveled and worked odd jobs for nearly a decade, mostly in the hospitality industry. Now in her 30s, she wants to start a career and is watching the labor market. “Look what happened to hospitality in the pandemic,” she says. “I want a skill that will outlast that kind of upheaval.”
Her major at the Waco campus of Texas State Technical College: welding. “It’s a welders’ market right now,” she says, “and the college has connections to employers. This makes a lot more sense for me than a bachelor’s degree.”
Vaccination Status Is The New Must-Have On Your Resume
Job candidates may have a new line item to add as more companies require measures to protect against the coronavirus.
Job seekers are considering a new addition to their résumés: Covid-19 vaccination status.
As employers make vaccine rules for workers and some limit hiring to the vaccinated, people are starting to volunteer their vaccination status on job applications, in résumés and on their LinkedIn profiles.
David Morgan, chief executive of Snorkel-Mart, an online snorkeling gear wholesaler and retailer, started requiring full vaccination for the company’s 20-plus employees in the spring. He says he favors candidates who are candid about their vaccine status on their résumés because it prevents surprises late in the hiring process.
“It saves us a lot of time and hassle to just clear it out in the résumé phase,” he said. “Candidates must be aware of the fact that the vaccination status holds the same importance as your personal profile nowadays, if not more.”
In an August survey of 1,250 hiring managers, nearly 70% said they were more likely to hire somebody who indicates on their résumé that they have had the shot, according to ResumeBuilder.com, which commissioned the poll. A third of hiring managers surveyed said they were automatically eliminating résumés that don’t spell out vaccine status.
Employees and bosses across the country have been adapting to a patchwork of laws and guidelines around vaccination, testing and masking as workplaces reopen more widely. Earlier in September, the Biden administration said all employers with 100 or more workers will have to start requiring that employees be vaccinated or undergo at least weekly Covid-19 testing, creating new pressures for managers and questions for workers.
New data from job-search engine Adzuna shows an uptick in job postings that seek fully vaccinated candidates. In August, more than 50,000 new job postings on the site said Covid-19 vaccination was required, up from 35,000 in July and 2,300 in January. Positions in healthcare, hospitality and catering and information technology were the most likely to require vaccine disclosures.
More job seekers are adding their vaccination status to the top of their professional profiles on LinkedIn, in some cases spelling out “fully vaccinated” before their job titles. Recruiters and career coaches say the practice of sorting résumés based on vaccine status is still new, but that it isn’t a bad idea to include vaccine information on a CV.
“I personally think it can only help,” said Ken Zwerdling, founder of the career coaching firm Global Expansion Inc. “It shows responsibility and safety right off the bat.”
Some legal experts say that it can be tricky for companies to press for this information, because they could weed out candidates who can’t be vaccinated for a religious or medical reason, said Rachel Conn, an employment attorney in San Francisco at Nixon Peabody LLP.
“It’s still potentially discriminatory if the employer is making a decision based on a protected status,” she said. “It’s kind of an unwitting trap for employers. You may make an unconscious decision because you prefer this person.”
Mollie Kerr, a 22-year-old recent graduate from Elon University in North Carolina, added that she was fully vaccinated in her LinkedIn profile after her stepfather, who works as an employment lawyer, suggested it may give her a leg up, especially following the Biden administration’s mandate.
Ms. Kerr, a political science major who is looking for a job in government, also includes her vaccination status in her cover letter and said it is better to have it in there than not.
“I think it is something a lot of hiring managers are dealing with and maybe they’ll think I’ll give them less of a headache in the hiring process,” she said. “I feel that it shows I care about the health and safety of others.”
As more companies put vaccine mandates in place, some hiring managers say they are trying to find talented people who already have complied. In a recent survey of more than 1,000 small-business owners, 60% said they want to hire vaccinated people only, according to Digital.com, a software company for small business that commissioned the survey.
Andrew Challenger, senior vice president of outplacement firm Challenger, Gray & Christmas, said putting vaccination status on a résumé can help a candidate by letting a recruiter skip the political and cultural debate around the topic.
“If they can make a recruiter’s life a little easier by circumventing this touchy question, it could be the advantage that gets them an interview,” he said.
Not all résumé coaches are in favor of voluntarily disclosing vaccine status. Robynn Storey, chief executive of Storeyline Resumes, said she is telling job seekers not to put their vaccine status on their résumés, adding that the onus should be on the company to ask about it upfront.
“It leaves a bad taste in the mouth. Applicants need to be judged on their abilities and qualifications. It feels like asking to put height or weight on my résumé,” she said.
Disclosing vaccine status can even help with those seeking fully or partially remote jobs. More than 70% of hiring managers at companies where new employees will work hybrid schedules said they wanted to hire vaccinated applicants, and 61% of employers where people primarily work remotely preferred to hire vaccinated people, ResumeBuilder research found.
The Latest Boom In Cryptocurrencies Is Happening In The Job Market
Even as regulators tighten their oversight of cryptocurrencies and related businesses, hiring in the industry is reaching a fever pitch.
On many employment websites such as Indeed.com, crypto searches are more than double year-ago levels. On LinkedIn, paid U.S. job postings with keywords like “cryptocurrency” and “blockchain” were up more than 600% from the previous year as of Aug. 1 and almost 400% compared with the same date in 2019. One popular jobs board, CryptocurrencyJobs.co, saw nearly 1,500% growth in paid listings since last year.
The hiring frenzy is happening just as China bans cryptocurrencies — again — and U.S. regulators pursue actions against related businesses big and small. The Commodity Futures Trading Commission said on Tuesday that it fined the exchange Kraken $1.25 million to settle allegations that it let Americans illegally trade margin products.
A number of agencies are probing exchange Binance. Coinbase Global Inc. recently axed its upcoming lending product after receiving a Wells notice that said the Securities and Exchange Commission was threatening to sue the company over it.
“Everyone is hiring right now across roles,” Daniel Adler, founder of CryptocurrencyJobs.co, said in an email. “At the beginning of the year, some teams were looking to double in size. Some already have, and are looking to grow further. Hiring is highly competitive. And it’s the strongest I’ve seen since launching Cryptocurrency Jobs in 2017.”
Top companies hiring in recent months have included Kraken and Coinbase, as well as more traditional firms like Accenture, KPMG, PayPal Holdings Inc. and JPMorgan Chase & Co., according to LinkedIn. Decentralized-finance projects — those that let users trade, borrow and lend coins without using centralized middlemen — drove hiring on CryptocurrencyJobs.co, Adler said.
“You’ll find most opportunities within the Ethereum ecosystem,” where many DeFi projects live, he said. “Other ecosystems have also emerged and are contributing to the demand, such as Solana. You’ll also find more non-crypto companies looking for crypto talent. This is in contrast to previous years when demand for crypto talent was (almost only) limited to crypto startups.”
Many employers not only are offering hefty salaries and bonuses, but also allocations of tokens, Adler said. And people who get the jobs are coming from all walks of life.
“You will find former high school teachers, financial services professionals from Wall Street, college dropouts, lawyers, academics, folks straight out of college, from across tech and industry,” Adler said. “The other great thing about crypto is that it doesn’t matter whether you’re in Silicon Valley, India or Nigeria, or what your background and credentials are.”
Burned Out? Maybe You Should Care Less About Your Job
Boundaries gone, meetings multiplying, many say work has taken over their lives during the pandemic. Here’s how to gain perspective and take back control.
When Jonathan Frostick realized he was having a heart attack in April—sitting at his desk on a Sunday, prepping for the workweek—he thought about his wife and his will.
He also thought: “I needed to meet with my manager tomorrow, this isn’t convenient,” prefacing the comment with an expletive.
The 45-year-old financial-services worker survived, and changed his life. The non-negotiables on his calendar now are thrice-weekly swims and dropping his youngest son off at nursery school. In his (fewer) hours on the job, he says he’s calm, decisive, above the fray. When he has too much on his plate, he leaves the work for another day. He insists on 30-minute meetings that stay on point.
“I’ve been stressed once since the heart attack,” he says. “It’s like this switch now. It doesn’t matter.”
But back then?
“I was my work,” he says.
We put in too many hours; we don’t take vacation; we can’t say no to that 6 a.m. conference call. Underneath it all is something bigger: an emotional attachment to our jobs that exhausts us and squeezes out the other parts of our identities.
For years, we were told to find meaning and purpose at work, while other parts of modern life, like church, receded. Then came the pandemic.
Sure, some employees leveraged remote work to sneak in noon naps or shirk one job with a secret second gig. But for many, work has become our lives. We sat down at our computers in the spring of 2020 and haven’t let up since. Now we can’t figure out how to turn it off.
Can we learn to care less? (Ideally, without having a brush with death?) What happens if we let go, just a little?
‘If I ask for everything and need it tomorrow, obviously my team is never going to feel like they relax and take a true break.’
— Katie Burke, HubSpot
Not much, assures Sarah Knight, who ran her own experiment a few years ago. After suffering a panic attack in her Manhattan office, she decided to pull back from the perfectionist tendencies that had propelled her to senior editor in the publishing industry. She stopped taking business lunches. She left the office by 6 p.m. She traded her blazers and high heels for Gap corduroys and tennis shoes.
No one seemed to care.
“I was like, I could have been doing this the whole time,” she says.
She left the corporate world, moved to the Dominican Republic and wrote a book, “The Life-Changing Magic of Not Giving a F*ck,” about opting out of the draining or useless things in your life.
“You have to be able to ask yourself: Is this real? Is this really a thing that is part of my job? Do I really have to do it?” she says.
Sometimes the answer is yes. Business lunches might be crucial to continuing to earn a paycheck. But something else probably isn’t, Ms. Knight advises. As much as a quarter of the stuff you’ve taken on over the years may be an unnecessary time suck. Let those things go, she says, just like an old sweater that no longer sparks joy.
Easier said than done, of course. Workers don’t live in a vacuum. Some bosses have unreasonable expectations. Tasks have ballooned as colleagues leave in a wave of quitting or companies opt to stay lean after layoffs. Nearly 90% of workers said they’d experienced burnout over the past year, according to a summer survey from people analytics firm Visier. More than half said their workloads had increased during the pandemic.
Some companies say they care, but does any CEO actually want employees to be less obsessed with work? Firms have tried to combat burnout—with listening sessions, extra days off—but many employees say they end up wedging work in anyway.
“If I ask for everything and need it tomorrow, obviously my team is never going to feel like they relax and take a true break,” says Katie Burke, chief people officer at HubSpot, a Cambridge, Mass.-based software firm. Workers there told executives that meeting-free Fridays were nice, but relaxing deadlines and putting more people or technology on projects would help more.
The company is working on it. At a recent meeting, Ms. Burke instructed her team to lay out three things they wouldn’t do before the end of the quarter, “no matter who asks you to do them.”
Productivity might slip in the short term, she says, but easing up helps with keeping and attracting workers.
“A vibrant life outside of work,” Ms. Burke says. “Everyone wants that.”
Next step: figuring out what to do during all that extra time you used to spend working. Janna Koretz, a psychologist and founder of Azimuth, a Massachusetts therapy practice, counsels people in high-pressure careers on learning to let go and delegate to capable colleagues. One issue she observes: Overachievers often throw themselves too zealously into new hobbies.
Instead of jumping into marathon training, try a 5K, Dr. Koretz advises. The idea is to make extracurriculars sustainable, not to pile on a different kind of stress. And remind yourself that taking a full lunch hour or logging off early to head to your child’s soccer game doesn’t make you a bad worker, she says.
“It doesn’t mean, ‘I’m going to get fired,’” Dr. Koretz says. “It doesn’t mean, ‘I’ve given up.’”
You might end up being better at your job. With less on your plate, and more perspective, every task will stop feeling like a fire drill and you can focus on what matters.
Anton Strömberg, a program manager with a digital education organization in Stockholm, used to spend three days attempting to craft the perfect email, “as if the world would fall apart if I made one mistake.”
Obsessing killed his creativity. Raising his hand for everything left him overwhelmed.
Now, in meetings, “I just sit there quietly and wait for someone else to take it on,” he says. “I buy myself time. I take a deep breath.”
For Nate Holdren, a professor in Des Moines, Iowa, the challenges of pandemic work—trying to discern his students’ reactions during remote teaching, helping them navigate Covid-19 crises—left him questioning his own self-worth.
“It’s like, not only did that session not go well, but maybe I’m not good at this,” he says. “It’s really easy to keep going over and over and over it again.”
Recently, he bought a T-shirt and notepad to try to shift his outlook. In capital letters, both declare: “I just work here.”
How To Keep The Job Search Moving Forward—Even If Recruiters Ignore You
Career coaches say these interviewing and résumé tips can help you stand out and land a new role.
There are more than 10 million job openings in the U.S., so why do so many job seekers remain frustrated by hiring managers who ignore them and online application portals that delete them?
There are a lot of jobs out there, but a lot of rejection, too. It’s easier than ever to apply for roles, so companies are swamped, leaving applicants—even ones who have been courted by recruiters—either facing a void or never hearing back again.
Hiring experts at Tuesday’s WSJ Jobs Summit said candidates can take steps to build relationships with the humans overseeing the hiring process—and bounce back faster when they are rejected.
“Job searching’s probably not easy for anybody,” said Brie Reynolds, a career coach and career-development manager at FlexJobs, an online site that lists flexible and remote job opportunities. “There’s always a confidence piece there that you want to make sure you’re building up.”
Here are more tips from career coaches.
You’re going to be ignored. Persist anyway.
Maintain reasonable expectations, and don’t expect a reaction from every hiring manager you reach out to, said Christine Cruzvergara, chief education strategy officer at Handshake, a careers site for college students and recent grads.
“Sometimes you might not be the right candidate at that certain time,” she said.
Knowing when to follow up after applying or interviewing for a job can be one of the toughest challenges for applicants—especially if early conversations seemed promising and now you have been left hanging.
“Organizations deeply appreciate persistence, as long as your persistence is generous,” said Keith Ferrazzi, an executive coach and author of “Leading Without Authority.” Sending a flurry of check-in emails is usually a bad idea, he added, but asking thoughtful follow-up questions by email and volunteering your knowledge to a potential boss can be a winning strategy.
“If your persistence is, ‘What about me? What about me? What about me?’ That’s not generous,” he said. “If your persistence is, ‘I’ve been thinking about your company, I’ve been researching a little bit more about your company, I’ve had a few ideas about the conversation we had,’ those are generous acts of reaching out.”
Motivated job seekers should ask if there is anything they can do during the hiring process to demonstrate to the employer that they are right for the role, Mr. Ferrazzi said, and then follow up to prove it.
“Ask the person interviewing, ‘Is there anything you are curious about relative to my ability to perform this job that I can do between now and the next call that could show you how I can perform?’” he said. “Actually start the work.”
Nontraditional methods of communication can sometimes yield a surprise reaction, said Keith Wolf, chief executive of ResumeSpice, an executive and professional résumé-writing service. He advises reaching out to people you are eager to connect with on Twitter or Instagram instead of simply sending an email.
“Twitter—you can have a conversation with someone who will never return your email,” he said.
Don’t Worry About Beating The Bots
People become obsessed with outsmarting résumé-reading applicant-tracking systems that most companies use to sort through candidates. It is a better bet to focus on the information and keywords provided in a job description and incorporate them into your résumé, Mr. Wolf said.
“It’s almost like you’ve been given the answers to the test,” he said, adding that the skills and demonstrated experience spelled out in a job posting should be reflected in a résumé.
Mr. Wolf recommends using logical headers—such as experience, education and skills—and ditching fancy formats and fonts. “Anything you think is going to get a human’s attention to really stand out can hurt you when it comes to an applicant-tracking system, and they won’t allow your résumé to be read,” he said. “Simple is better.”
Another Tip: Eliminate the objective statement. Those few sentences at the top of a résumé, summarizing skills and the type of role a person is seeking, only makes it easier for recruiters to disqualify anybody who is not an exact match, Mr. Wolf said.
“It’s a great excuse just to take you out of the pack,” he said.
Another common mistake is using valuable résumé real estate to describe your companies instead of your work, said Ashley Watkins, a job-search coach at Write Step Resumes LLC. While it is tempting for job seekers who have worked for startups or small businesses to detail what their prior employers have done, a résumé should be all about you, she added.
“If I want to know about the company, I can Google them, as a recruiter,” Ms. Watkins said. “The résumé is about you and the value that you offer, not your company.”
London Finance Job Postings Set Fresh Record In Third Quarter
The easing of lockdown in the U.K. is turbocharging the market for London finance jobs, with postings in the third quarter more than double last year’s level.
There were 8,343 new listings for financial services positions between July and September, according to recruitment consultancy Morgan McKinley and data provider Vacancysoft. That compares to 3,575 in the same quarter last year.
In September alone, 2,818 new jobs were posted, marking the busiest month since at least January 2014.
The number reflects the brake on hiring during lockdowns imposed to slow the spread of Covid-19. It’s a similar story across the U.K. finance sector, where the number of new banking jobs breached 5,000 in June.
“This has been caused by the easing of government lockdown measures, and in turn with banks initially having made cuts to their staff, they now need people to join their teams again,” said Ben Harris, head of governance at Morgan McKinley. “The recruitment market has turned to become a candidate-led market with candidates having multiple different options on the go, which requires institutions to move quickly when hiring.”
There’s particular demand for jobs in risk and compliance, with hiring for these roles making up about 13% of all banking vacancies, the data show.
Citadel Pledges Resources To Help Low-Income Students Get Jobs
The hedge fund and the market maker controlled by Ken Griffin are providing high-achieving students from lower-income communities resources they need to succeed in school and land a job.
Citadel and Citadel Securities joined with non-profit Thrive Scholars to create career opportunities for students of color interested in science, technology, math and finance, according to a statement Wednesday. Citadel will provide internships, mentors and funding for Thrive’s six-year academic and professional development program for students.
“Students in low-income communities often don’t have the networks to get the interviews, internships, and exposure that leads to jobs, compared to their more-privileged counterparts,” Thrive Chief Executive Officer Steve Stein said in an interview. “We want to make sure they get the experience and knowledge they need to succeed.”
Citadel has focused its effort on developing young talent and attracting candidates from top-tier colleges, while pushing to increase diversity. Stein said more than half of the Thrive students express interest in STEM careers at the start of the program.
“Our overall goal is to help scholars build financial security” and “upward economic mobility,” Stein said. “If you think of who our students are and the types of jobs we want to have available to them, it’s Citadel.”
Thrive targets the points of development that prevent high-achieving, low-income students from getting into top colleges and launching careers, including pre-college preparation, college advising and career coaching.
The organization “empowers exceptionally talented students — regardless of background — to best pursue high-impact careers,” Griffin said in the statement.
In an interview on Monday, Griffin tied economic inequality in the U.S. to problems with education. “We have narrowed the window of opportunity in our country by our broken K-through-12 education system,” he said.
U.S. Companies Add Most Jobs In Three Months, ADP Data Show
U.S. companies added more jobs than forecast in September, the most since June, suggesting that ongoing hiring challenges are beginning to ease as more Americans return to the workforce.
Businesses’ payrolls increased by 568,000 last month, led by leisure and hospitality, after a revised 340,000 gain in August, according to ADP Research Institute data released Wednesday. The median forecast in a Bloomberg survey of economists called for a 430,000 rise.
The stronger pace of hiring indicates that companies had greater success filling open positions after enhanced federal unemployment benefits ended on Sept. 6 and as schools reopen, allowing some parents to return to work. Even so, it’ll take more time to reach a full labor market recovery — total employment measured by ADP remains well below pre-pandemic levels.
The data come ahead of Friday’s monthly employment report from the Labor Department, which is currently forecast to show the U.S. added 450,000 private payrolls in September. While the ADP data don’t always follow the same pattern as the Labor Department’s data, the acceleration could point to a strong September report.
Stocks opened lower, while the dollar strengthened and the 10-year Treasury yield was little changed.
Led by Leisure
Service-provider employment increased 466,000 in September, led by payrolls at leisure and hospitality businesses, which rose by 266,000 during the month.
Payrolls at goods producers climbed by 102,000, mostly driven by gains at construction and manufacturing firms, both the most in a year.
“Current bottlenecks in hiring should fade as the health conditions tied to the Covid-19 variant continue to improve, setting the stage for solid job gains in the coming months,” Nela Richardson, ADP’s chief economist, said in a statement.
Companies with more than 1,000 workers added 354,000 people to payrolls, while small businesses posted a gain of 63,000.
ADP’s payroll data represent firms employing nearly 26 million workers in the U.S.
As Louisianans Flee Hurricanes, Natural Gas Dollars And Jobs Flood In
If you drive far enough down through southwest Louisiana, past the petrochemical plants and the wide marsh to where the road ends at the Gulf of Mexico, you’ll find Cameron, a little town of oystermen and shrimping boats. It’s right near the Chocolate Milk Beach, which is what I called Holly Beach back when I was a kid and my dad would drive us there, 40 miles south from our home in Lake Charles, stopping for shrimp along the way.
I didn’t know back then that the water’s Yoo-hoo color was caused by sediment dredged up so places like Lake Charles could have a shipway and an economic lifeline.
Today the communities of Cameron and Holly Beach look a lot different. In late August 2020, Cameron Parish, where they both lie, was hit square-on by Hurricane Laura. Six weeks later it was lashed by Hurricane Delta. Laura’s 150 mph winds peeled off roofs and smashed holes in brick walls.
Into those wounds poured Delta, bringing more wind, 17 inches of rain, and a 9-foot storm surge. Half-done repair jobs—patched-together siding, new drywall, jury-rigged front doors and windows—were destroyed, along with the life savings of many families.
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Lake Charles, the region’s hub city, was left unrecognizable. When I visited the morning after Delta, I found glorious, Spanish-moss-dripping oaks rotting roots-up in friends’ front yards like dead roaches. Tall pines had snapped in half, and magnolia branches were clogging the drainage ditches where I once caught crawfish.
What remained were homes with blue tarp roofs, microwaving under the bright, hot sky. “It’s like someone turned on the lights here,” one resident said.
The sad waltz of southwest Louisiana had only just begun. A few months later the historic freeze that knocked Texas offline struck the crippled communities across the state line, too. Some people here spent 18-degree nights shivering in roofless homes as the death toll—from hypothermia, exposure, carbon-monoxide poisoning caused by generators—rose.
The lucky ones who’d skirted the storms with only a lost fence or a roof puncture now had to deal with burst pipes and weeks without power or water. Then May brought heavy rains and a thousand-year flood, which seemed to be a capstone event on the steady, dire warning from Mother Nature about the hazards of a changing climate.
Hurricane Ida, in August, largely spared the Southwest, but it served as a reminder of the region’s peril. Outside the flood protection system around New Orleans, some communities faced catastrophic, irreversible damage.
There are no levees around Holly Beach or Lake Charles, and there’s only so much government can do to keep people dry. For many in these parts, flood protection means pylons, plywood, sandbags, and crossed fingers.
Everyone around here speaks natural disaster. They know when to flee and what can happen if they don’t. Ask anybody you meet, and chances are they lost a grandparent or a neighbor or a cousin in 1957, when almost 400 people were killed by Hurricane Audrey. You might think, given the latest cascade of traumas, that residents would be leaving in droves, and it’s true, most are wrestling with the question of whether to rebuild or start over someplace else.
You hear neighbors debating it on porches at dusk, in line at the few remaining grocery stores, in the comments section of the American Press newspaper. Many are going. But people in southwest Louisiana are stubborn about their vision of the good life on the bayou: rocking chairs, a Gulf breeze, and the electric air of a Mardi Gras morning.
And for every family that decides to pack it in and head for high ground, others are rushing in on the counterflow. That’s because, for all the danger the storms pose, the economic opportunities are too good. This region has seen $100 billion worth of capital investment over the past decade, thanks to liquefied natural gas, or LNG. Shale exploration has left the U.S. with more natural gas than it can use, and in 2018 the country turned from a net importer to a net exporter.
Already, a little more than half of all U.S. LNG exports flow through two terminals in Cameron Parish, including the country’s biggest, owned by Cheniere Energy Inc. Another 10 major projects are either approved or under construction. The Southwest Louisiana Economic Development Alliance estimates that, between pending and completed projects, 77,000 jobs are being created.
Natural gas is set to overtake coal as the world’s second-biggest energy source by 2035, according to the International Gas Union, and little Cameron is poised to provide. Drive across the bridges that crisscross the swamp at night, and you’ll see a Cajun Emerald City: steam towers and hydrocarbon crackers, lit up in an orangy glow.
So the jobs seem safe, even when the region does not. But some locals hold that the danger itself is a mirage. Many of those who are staying say there’s no proof the storms will keep getting worse. And no, they don’t believe the fossil fuel industry is to blame for recent weather trends—that’s just liberal talk.
And fracking equals cash, damn right. Cameron Parish is bright red, voting 90.9% Trump in 2020. This is MAGA country, where for many there is no climate change, just random storms of random strength issued by the heavens, again and again.
Last Oct. 10, hours after the eye of Delta struck Cameron, I was splashing down Highway 27 in hip waders when I noticed the birds. The pelicans and terns were flying twisted and scattered, as though they were still caught in the 100 mph winds, desperately disoriented.
I was lost, too. I was trying to find Tressie Smith’s restaurant, Anchors Up, but with most buildings destroyed or partly submerged and all the signs blown away, the town I’d known since childhood no longer seemed to exist. Smith had asked me to take a photo of Anchors Up so she’d know if there was anything worth going back for.
She’d been at a relative’s house in Lake Charles during Laura, texting me as things escalated: “Raining like hell.” “Lights flickering.” “Power off.” When Cameron was evacuated in advance of Delta, Smith got wise and drove all the way to Houston. The morning after the storm, they let the media in, and I told her I’d report back on what I found.
I walked through the main cemetery and saw that the mausoleum was exposed, with rows of empty slots where bodies had once rested; the caskets had floated out into the floodwaters. A little farther along the road, I spotted Anchors Up. The place had lived up to its name, casting off from its foundation and drifting, intact, on the storm surge to the parking lot behind the Capital One, about a block away.
It sat next to a stranded shrimping boat like a beached turquoise whale, bags of Zapps potato chips still clinging to racks inside. I sent Smith a pic, but she didn’t write back. Maybe she was busy, or maybe she couldn’t bring herself to reply.
One block over, a home alarm was beep-beep-beeping beneath a pile of debris. The only other sound was the rhythmic lull of waves lapping against the remains of people’s lives. A small herd of newly stray dogs and cats started following me around, meowing and yipping, jumping from one junk pile to the next, hoping for food.
At First Baptist Church, the windows Laura had blown out were replaced by plastic sheets that flapped and swished in the wind. Inside, dozens of folding tables had been set up, with donations sent after Laura stacked high: clothing, loaves of bread, water, diapers. It would have been a heartwarming scene of community resilience, had Delta not swept in.
Clothes and diapers were sopped with swamp water, as were the bread slices that littered the floor. Water jugs had fallen and burst. In one corner a whiteboard cheerfully announced, “Take what you need!” It was a picture of compounded sorrow: Cameron hadn’t recovered from the first disaster before the next one hit.
In a sense, that’s how history has played out here for decades. The modern run of megastorms began with Audrey, which made landfall in 1957 between Holly Beach and the mouth of the Sabine River, where Cheniere LNG is located now.
Lacking a storm-warning system, advanced radar, Doppler technology, or the Saffir-Simpson category scale and its cones of danger, the people of Cameron only had the word of their local weatherman to go on. Hundreds died.
The day before Audrey hit, the Weather Bureau warned everyone living in “low and exposed places along the beach” to move to higher ground, but many people didn’t, either because they weren’t on the beach or they didn’t believe they lived in a low-lying area. A man named Whitney Bartie lost his family when the storm swept them off the roof, one by one.
He sued the federal government, claiming its warnings had been insufficient to the point of negligence. The lawsuit recounts that a TV news broadcast the night of the storm had said “there is no need for alarm tonight” and “you can rest well tonight.”
It later emerged that the advice had been intended only for Lake Charles residents, not Cameron, but the words became local legend down here anyway.
So, too, did the accounts of survivors. Archives compiled by the National Weather Service and the Louisiana Digital Library include the story of a man and his niece who “floated out the window” and then were separated by a tidal wave that cast the man, clinging to a piece of wood, 3 miles away. Cameron, population 3,000, was left looking, in the words of Mrs. John R. Smith, “as if no one had ever lived there.”
I still remember reading, in the town’s old library (itself since destroyed by a storm), the tale of a child who’d seen a ghost dressed in a long white gown calling his name before water sucked her out the back door. His mother.
Stories such as these have suffused Cameron with a haunted, gothic feel, persisting through a relative quiet spell until Rita (2005) and Ike (2008) pummeled the region in short sequence. With every new storm, people’s relationship to nature frayed further. Many locals carry the trauma defiantly, as a sword against impending reality, insisting on finding ways to stay put, storm after storm after storm after storm.
In her 2016 book about southwest Louisiana, Strangers in Their Own Land, sociologist Arlie Russell Hochschild calls this attitude the “Great Paradox.” She concludes that people here dismiss skeptics, critics, and reality itself, because they want badly to hold on to the “elation” that comes with living their own truth. But the storms of the past few years are testing that elation like never before.
“I feel powerless against Mother Nature.”
Sarah Guilott-Mcinnis is sobbing in her kitchen in Lake Charles, where she’s opened up her cabinets full of colorful dishes and glass pitchers for a rummage sale with hardly any customers. “I’ve been fighting water for so long. I’m so tired of fixing shit. I feel so defeated.” She gasps between hiccups. “I-I-I just want to leave and start fresh somewhere else, anywhere.”
Guilott-Mcinnis had a baby right before the pandemic hit. A few months later she took over the laundromat business her grandfather had started, only to watch the virus drive customers away.
“I thought that was the worst of it—Covid plus a baby plus a failing business,” she says. “Then the hurricanes began.”
In August, Laura ripped down the chimney and many of the eaves of her home, a midcentury geodesic dome with a sunken den. Six weeks later, when Delta dumped its record-setting 21 inches of water in Lake Charles, the rain streamed down the inside walls—“like from a faucet,” Guilott-Mcinnis says—and drenched the bedrooms.
Come February, the freeze caused a pipe to burst. She and her husband had to rip down a wall by hand so they could stanch the spray.
In May, Guilott-Mcinnis was dropping off her baby at her mom’s when she got stranded by high water from the random, pre-summer swirl of storms that were bringing the thousand-year flood. Her husband phoned and said the water was up to their front door. Half an hour later came the call she’d feared all year. “It’s done,” he told her.
Their home, which she’d bought at 23, poured almost $100,000 into, and blogged about because of its historic design, had completely flooded. The family’s most important possessions were floating around in Tupperware, a precautionary measure they’d taken as the forecast worsened.
I notice a foot-high waterline on the doorjamb below where they’d measured the two kids’ heights in green marker.
Lake Charles is a gambling town, with billboards and legends of pirates and buried bullion beckoning Texans over the bridge to its gaudy casinos. And Guilott-Mcinnis was now a four-time loser, one of many. U.S. Postal Service address-change records suggest that Lake Charles lost a greater share of its population in 2020 than anywhere else in the country, shrinking 6.7%.
The true figure is likely higher, because registering an address change isn’t at the top of most evacuees’ priority list. Following the May floods the city government estimated that 3,000 of 80,000 residents were displaced, and it wasn’t clear if they’d ever come back. The trend is best described as a climate exodus.
Guilott-Mcinnis and her husband are moving to Fayetteville, Ark. She doesn’t know anyone there, but she heard it was nice.
Down in Cameron you can find signs of a revival, albeit one that’s leaving the town looking much different than it’s ever been.
Homes that became debris piles are being raked up and hauled out, and in their place hundreds of RVs have moved in.
Many are company-owned: shiny, matching, and new, powered by a humming chorus of generators.
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The change has happened fast. Cameron is no longer a deep-rooted shrimping town. It’s become a get-in-and-get-out LNG town, the lodging site for one of America’s most Covid-proof, booming industries. As of this June the local government placed the permanent population at 50 to 75 people, compared with 900 more-transient facilities workers.
A gig at one of the plants brings in $1,796 a week, on average, a wage the Cameron Parish port touts as the country’s highest for counties with a comparable number of jobs. In the past 15 years, the parish’s median household income has almost doubled, from $35,000 to $67,000.
Workers are bused daily to the two LNG facilities already operating here, Cheniere and Cameron, and to the six additional developments that are under construction. Right over the border in Texas two more are being built. According to a report from McKinsey & Co. in February, 200 million metric tons’ worth of new capacity will be required by 2050 to meet global demand. A big share of that will be in southwest Louisiana.
On a sinisterly hot afternoon, I toured Cheniere’s sprawling LNG facility, situated on a plateau of old Army Corps of Engineers dredge spoils. LNG is methane gas in liquid form. The gas is piped into southwest Louisiana from fracking sites around the country, then cooled for liquefaction.
The liquid takes up one-six-hundredth the space as the gas, making it vastly more cost-effective to export. Once it reaches its destination, it’s heated back into gas form for consumer use. Cheniere is the largest American LNG producer and one of the world’s biggest exporters. China and the European Union are its biggest customers, and Brazil is gaining quick.
Cameron and the Sabine Pass’s position on the coast and in the middle of the U.S. made the site ideal for import terminals back when the country was bringing in LNG. But the fracking boom led Cheniere to retrofit its facilities for export. From the highway bridge that leads to Texas, the plant dwarfs the nearby fishing camps.
It features five of the “trains” that liquefy and purify the gas, with one more under construction, and it has five storage tanks that could each fit a 747 inside. There are two ship berths; a third is on the way.
All of this investment has to be protected, of course. After Hurricane Ida made landfall to the southeast in late August, the Coast Guard received thousands of reports of pollution seeping from the industrial corridor environmentalists have dubbed Cancer Alley, and the National Oceanic and Atmospheric Administration received 55 spill reports.
A similar storm in southwest Louisiana could be even more perilous. Laura threatened 3.5 million barrels per day of refining capacity, according to the American Fuel & Petrochemical Manufacturers, and the flurry of LNG construction has left a vulnerable collection of massive, half-built facilities.
The industry has spent millions to safeguard infrastructure in the area, and thus far, it has escaped major damage.
As we tour Cheniere’s facilities in a truck, Amy Miller, the plant’s supervisor for local government and community affairs, who’s also a Cameron local, tells me the buildings are fortified against winds of 150 mph and the cooling trains are elevated 18 feet in case of flooding.
The site can also generate its own power if the local grid goes down. Miller points out that employees are required to back in their cars when they park, so they can get out quickly in an emergency. The only time the plant has ever shut down and evacuated completely was during Laura.
After Laura, some of the area’s LNG terminals went offline, but within two weeks feed gas deliveries were again on the move, and cargo ships were churning up and down the Sabine Pass. Delta, the freeze, and the floods saw only a chlorine plant explosion, outside Lake Charles where the petrochemical refineries are—not bad for a place rife with hazmat sites.
Before I head back to Cameron, Miller reminds me of how much Cheniere has invested in stormproofing and notes that LNG would “evaporate 100%” if it were to spill.
Within the industry, LNG is seen as a solution to climate change, not a contributor to it. “Natural gas combines high heating intensity and efficiency with low emissions and virtually no pollution,” an executive from the International Gas Union, an advocacy group, said in a 2018 report.
In some of the world’s poorest areas it replaces coal or can be used in lieu of cow manure or camel dung. India is set to almost double the length of its gas transmission grid, and China is experiencing record natural gas demand. At least four-fifths of Brazil’s LNG imports come from the U.S.—mostly through Cheniere—and that figure could increase as drought depletes the country’s hydropower reservoirs.
LNG’s boosters often call natural gas a “bridge fuel” that allows for dirtier energy sources such as coal to be replaced now, in anticipation of a future when it will itself be phased out in favor of cleaner energy sources. Environmentalists say that’s Pollyannaish thinking, noting that LNG is the product of a damaging process, fracking, and that methane and other harmful gases can be released during the export process.
Transport via tankers adds to the greenhouse gas tally. Additionally, “the massive investments in infrastructure to support this industry,” the Natural Resources Defense Council wrote in a 2020 report, “lock in fossil fuel dependence, making the transition to actual low-carbon and no-carbon energy even more difficult.”
“There’s a lot of fatigue. It’s no surprise a lot of people just want to move away”
When I mention the word “climate” in interviews around Cameron Parish, people often get uncomfortable and start sizing me up, trying to detect which way my politics lean. Some are blunter than others; one person I interview interrupts me to ask where my red hat is.
Trump toured Sempra Energy’s $10 billion Cameron LNG facility in 2019, shortly after signing two executive orders to ease energy industry restrictions, and visited again in 2020 after Laura, touring some of the storm-ravaged neighborhoods with Louisiana’s Democratic governor, John Bel Edwards. “I know one thing: that we’ll provide a lot of what they call the green,” Trump said. “We’re going to have this situation taken care of quickly.”
Within weeks, Delta struck, and down in Cameron I was seeing families huddled in cheap camping tents, pitched on the concrete slabs where their homes used to be. Tied to barren pillars that had once supported houses, you could see the bright red flag still flying high: Make America Great Again.
When you don’t believe man-made global warming is creating more frequent and severe weather events, it stands to reason you’ll be more likely to stay in their path. Bronwen Theriot, a science teacher at Cameron’s high school, once told me her attitude: “If it’s God’s will, you’ve got no power to change that.”
Her school was rebuilt by the federal government in 2006 after Rita, and it now sits on steel and brick pillars up in the sky. From Theriot’s classroom, students listen to her natural science lessons while gazing out over the front line of climate change, a bare horizon of marsh and the encroaching Gulf of Mexico.
How many hurricanes does it take to change a mind? For Nic Hunter, the 37-year-old, Trump-supporting mayor of Lake Charles, the recent rounds have been enough. “There’s just gotta be a point where you say to hell with politics and just call it like you see it,” Hunter tells me when we meet in his 10th-floor office downtown.
“And with what we have been through over the last year, how can you deny that there is something going on?” In a sign, perhaps, that voters are starting to modify their views on climate change, he won reelection in March with 74% of the vote, up from 56% last time out.
President Joe Biden visited Lake Charles in May, right before the floods, to tout his proposed infrastructure funding package. Hunter says they spoke for “six or seven minutes,” during which he asked the president to support supplemental disaster recovery funding for the region.
He wanted the federal government to bridge the gap between what the state and private insurance can pay residents. “He seemed very concerned,” Hunter says of Biden. “But ask me in six months if we have the supplemental disaster aid we need, and I will tell you if it was a good or fruitless conversation.”
Hunter didn’t wait that long to start pressuring the government on Facebook. After the flooding, alongside a montage of images of destroyed homes covered in blue tarps, he wrote, “Am I living in the Twilight Zone? Is this America?
I took these pictures TODAY on JULY 17, 2021, almost 11 months after Hurricane Laura, 9 months after Hurricane Delta, 4 months after a Winter Storm, and 2 months after a 1,000 Year Flood Event. … Multiply this by 600 and that’s a better picture of southwest Louisiana right now.” He added that federal supplemental aid had arrived in New Orleans 10 days after Katrina and on the East Coast 98 days after Sandy. The situation on the ground, he said, was “a humanitarian crisis.”
For weeks over the summer, the Lake Charles Convention & Visitors Bureau’s Visit Lake Charles website eschewed its usual colorful photos of slot machines and kids holding up baby alligators. A time counter on the homepage ticked off the seconds, minutes, hours, days “SINCE HURRICANE LAURA WITH NO SUPPLEMENTAL FEDERAL DISASTER RELIEF FOR SOUTHWEST LOUISIANA.”
In the meantime, in Cameron, a $32 million project got under way, seeking to scoop 2.36 million cubic yards of sand out of the Gulf of Mexico and plop it into what’s left of the marsh in the name of coastal restoration. It’s a Sisyphean way to approach nature, endlessly lugging sand after each hurricane in preparation for the next one.
Forecasters predicted that the 2021 hurricane season would be major—with 13 to 20 tropical storms, 6 to 10 of them hurricanes. Ida, for one, delivered. In August, as radar showed its red and yellow pinwheel spinning north through the Caribbean toward Louisiana, I checked in on my people.
Everyone was on edge. Social media was lit up with expletive-laden posts and “NOT NOW, IDA” pleas. There was a palpable sense that the region simply didn’t have the fight left for another storm. Instead, Ida went toward New Orleans, sparing southwest Louisiana.
Local newspapers began pondering whether it would help bring in federal assistance for their region at last, or steal away aid that might otherwise have headed their way—a Louisiana-style hunger games.
On Sept. 7, perhaps goaded by Ida, the White House asked Congress to fund additional relief for southwest Louisiana. A few weeks later the Biden administration said it was authorizing an increase in federal funding to the state for debris removal and unspecified “emergency protective measures” as a result of Laura.
The amount destined for southwest Louisiana is $600 million, far short of the $3 billion the state government had estimated was needed.
Hunter responded on Facebook. “I thank President Biden for his support. Though the final numbers are woefully inadequate,” he wrote. They “represent about 1/5 of what the state estimated our unmet need to be.” And that estimate, Hunter added, was from before the winter storm and May flood.
“Ultimately, we will do what we always do in SWLA. We will never give up,” he said. That elation again.
But the hurricanes keep coming. “There’s a lot of fatigue,” says Andy Patrick, the National Weather Service meteorologist responsible for Lake Charles. “It’s no surprise a lot of people just want to move away.”
In Lake Charles’s Greinwich Terrace neighborhood, the mostly Black residents were given that option in May—quit rebuilding and take a buyout. The community was identified for a voluntary program that’s operated by the Louisiana Watershed Initiative and funded with federal money, after an engineering company found the neighborhood was guaranteed to flood during significant rain events.
The residents already knew this: It had happened three times in the past four years, including in 2017 during Hurricane Harvey, which didn’t significantly affect other parts of Lake Charles. “The buyout is the best of a bunch of imperfect options,” Mayor Hunter says. He’s pledged to fight to make sure the residents are offered fair market value.
If everyone leaves, the plan is to remove all the impervious surfaces—concrete slabs and structures—in the area to turn it into a drainage basin for surrounding neighborhoods. In other words, the community is slated to become marshland.
“This is not normal,” Diamond Meche, a Terrace resident, tells me on her lunch break from her job at the Walmart across the freeway.
The application period for the program is only just beginning, and she and her parents don’t know how much they’ll get for their one-story brick home, but they plan to take the buyout and join the exodus. The people who want to stay or can’t afford to leave, she says, should expect more problems: “I wouldn’t advise people here to buy furniture, to be on the safe side. And I would advise you to live out of Tupperwares.” Meche still doesn’t know where her family will go.
Down in Cameron, Tressie Smith has converted Anchors Up into a food truck. “I realized that if I was gonna stay here, I needed to be on wheels so I can pick up and go,” she says.
The cost of rebuilding to meet new local construction rules that require everything to be up high made it too onerous to root down. The LNG facilities have kept Smith in business. “I depend on that lunch rush,” she says, stubbing out a cigarette. “How else is someone supposed to survive down here?”
She cusses, laughs, and ducks back into the truck as a facilities worker steps up to the window to order. He’s from Seattle, living in a man camp and wearing a work vest from one of the engineering and construction companies building LNG facilities.
While he waits for his shrimp basket, he looks around at the piles of tree branches and flattened homes. “There’s nothing here,” he tells me, “but it’ll make you all the money you need.”
There’s No One To Deliver The Pizzas
Domino’s posted its first decline in U.S. same-store sales in more than a decade because it cannot find enough delivery drivers.
There’s no one to deliver the pizzas.
Shares of Domino’s Pizza Inc. initially fell Thursday morning after the largest pizza company in the world posted its first decline in U.S. same-store sales in more than a decade. These results came as a shock to analysts and investors, who were expecting continued growth while the pandemic supercharges demand for takeout and delivery meals.
But demand may not be the problem. Rather, a dearth of delivery drivers — amid a national shortage of workers — could be what’s eating into Domino’s sales. (Shares later reversed course and erased their decline.)
As of August, there were still 10.4 million unfilled jobs across the U.S., compared with a record high of 11.1 million in July, according to the latest Labor Department figures released Tuesday. In mid-July, Domino’s also began taking much longer to get its orders out to customers.
National average delivery times “abruptly and surprisingly spiked 30%” and haven’t improved since then, James Rutherford, an analyst for Stephens Inc., wrote in a note to clients soon before the pizza chain released third-quarter results. He’s convinced that a driver shortage is to blame for these longer waits because carryout times at Domino’s restaurants didn’t experience a similar surge, according to data he scraped from the Domino’s website.
It just so happens that mid-July marked the first of the monthly payments for the expanded child tax credit, a form of Covid-19 relief money that provides eligible families $300 for each child younger than 6 and $250 for older children.
Rutherford suspects that with the child tax credit, some part-time Domino’s drivers are working fewer hours. That said, there’s a debate over how much pandemic relief funds are contributing to employers’ hiring struggles.
Relocations, a shift in which industries are in most demand and workers being pickier about pay and conditions are all likely factors. Whether a salaried office worker or an hourly employee, Americans have been reassessing their work lives ever since the Covid-induced lockdowns last year.
On Thursday’s earnings call, Domino’s Chief Executive Officer Richard Allison confirmed that staffing issues had a more pronounced impact on results and delivery times in the third quarter and said that the company had responded by introducing an improved system for applicants and onboardings as well as raising wages at company-owned stores.
Still, staffing “may remain a significant challenge in the near term as the labor market continues to evolve,” Allison said, citing difficulty in obtaining child care and lower immigration as contributing factors.
He added that while staffing difficulties affect restaurants and their suppliers more broadly, delivery drivers remain the biggest need. When stores don’t have enough drivers and pizza makers, they scale back operating hours, which cuts into orders.
Labor shortages are just one component of the economic abnormalities afflicting corporate earnings this season. Companies are also grappling with shortages of raw materials and cargo-ship space, and corresponding higher prices. Increased commodity and labor costs may be especially painful for smaller regional and independent restaurant chains, Allison said.
As for Domino’s, it takes a 36% share of consumer spending on pizza delivery in the U.S. Clearly, the company needs its drivers. Drivers, name your price.
Workers Who Quit Their Jobs Could Improve U.S. Productivity
People are leaving their workplaces in record numbers. That could push employers to raise wages as well as invest more in training and labor-saving technology.
Job growth has sharply weakened over the past several months, but it’s not — mostly — due to a lack of hiring. Instead, what we’re seeing is an unprecedented amount of churn in the job market. This is a painful experience for employers but it also sets the stage for a reversal of trends that have dominated the U.S. labor market since the dot-com crash in 2000.
In August, the latest month for which we have data, employers hired 6.3 million workers; that’s down only slightly from the 6.4 million they hired in the same month one year ago, when payrolls soared by 1.6 million. The difference this year is in the number of “quits.”
A record number of people, 4.3 million, quit their jobs this past August, compared with just under 3 million the year before. It’s tempting to blame the increase on the delta variant. Cases rose rapidly in late July and peaked in early September.
Yet quits began rising in January and — with the exception of a brief pullback in May — have seen an unprecedented explosion all year long. It’s worth taking a minute to note how unusual the surge has been. Quits typically rise as the job market tightens, but the scale of the increase in 2021 is far beyond anything on record.
Over the course of 2018, job openings grew, at a then record pace, from 6.6 million in January to a peak of 7.6 million that November. Over the same period, quits rose from just over 3 million to 3.4 million. From January 2021 until August, openings ballooned from 7.1 million to 10.4 million, while quits increased from 3.3 to 4.3 million. Both run-ups are roughly three times the 2018 rise and in fewer months.
At the heart of this phenomenon is a self-reinforcing cycle that has the potential to remake the labor market. As employers become more desperate to expand their workforce, job openings proliferate and workers become more confident in their options.
This not only makes them more likely to quit their old job but raises what economists refer to as their reservation wage — the minimum they’ll accept — for taking a new job. In the modern job market, however, reservation wage is best thought of as not simply minimum pay, but a minimum package of pay, working conditions and opportunities for advancement.
As workers become choosier along all of these dimensions, the potential applicant pool for employers shrinks. This makes them even more desperate, so they cast a wider net, posting more openings with fewer qualifications and thereby further pushing up reservation wages.
The cycle will be broken when employers turn their focus away from hiring more workers and toward increasing the productivity of their existing workforce. This is essentially the opposite dynamic from what the U.S. economy experienced after the 2001 recession.
In the wake of the dot-com bust, several interrelated factors — including a sharp slowdown in technology investment in equipment and machinery, rapid expansion in trade with China, the clustering of job opportunities in coastal cities, and overly tight monetary policy — created a persistent excess supply of unskilled workers.
This created an environment where employers could be increasingly stingy about who they hired, reduce investment in employee training, forgo the adoption of labor-saving technology and hold down workers’ wages. From 2000 to 2010, labor’s share of business expenditures declined from 68% to 61%. Productivity growth declined from roughly 3%-4% before the dot-com crash to less than 1% after 2010.
The signs of a reversal began even before the pandemic hit. Wage growth began to rise, particularly for lower-skilled workers, in 2018-2019. Productivity began to drift up closer to 2%. The direct and indirect effects of Covid — which pulled millions of workers out of the workforce and created major supply bottlenecks — make national-level data more difficult to interpret.
Nonetheless, there is every indication that these trends have accelerated. GDP in the second quarter of this year was higher than in the last quarter of 2019 despite the fact that 5.5 million fewer people were employed.
Likewise, total weekly wages paid to non-supervisory employees have hit new records even though millions of workers have yet to return to work. This is precisely what we would expect given the churn in the labor market, and there is every reason to think it will continue.
So while the competition for workers is fueling intense churn in the labor market and allowing them to hold out for ever higher wages, it’s also fueling the type of creative destruction the economy needs to break out of the low productivity trap that it’s been in since 2000. This should provide a solid foundation for a high-wage economy in the years to come.
America’s Workers Are Leaving Jobs In Record Numbers
U.S. workers handed in nearly 20 million resignations this spring and summer.
This year’s bold career move is walking out the door.
U.S. workers left their jobs nearly 20 million times between April and August this year, according to the latest federal data, a number more than 60% higher than the resignations handed in during the same period last year, and 12% above the spring and summer of 2019 when the job market was the hottest it had been in almost 50 years.
The data doesn’t count retirements but includes people who have quit jobs for any number of reasons, such as taking a job elsewhere, going back to school, leaving to care of a family member or simply taking a break. The data also includes people who may have quit multiple times, for instance leaving a job on a college campus in May and then quitting a summer job in August.
Additional data from the Bureau of Labor Statistics shows a steady rise in the employed-to-employed rate, indicating that many people are switching jobs, not sitting on the sidelines. The U.S. labor force gained about 2 million employed people between April and August, though that level is still almost 3% lower than it was pre-pandemic.
In August, a seasonally adjusted 4.3 million resignations were handed in, according to the Bureau of Labor Statistics. Though August is a traditionally high turnover month, in part because many teens and 20-somethings leave jobs to go back to school, the figure sets a record since the BLS started tracking it in 2000.
The sheer number of quits helps explain why so many employers are struggling to fill hiring gaps, said Danny Nelms, president of the Work Institute, a consulting firm that conducts 40,000 exit interviews each year for companies. At the same time, many workers have a rare edge: Jobs are plentiful, wages are rising and companies are competing for talent, he said.
‘This [pandemic] has been going on for so long, it’s affecting people mentally, physically. All those things are continuing to make people be reflective of their life and career and their jobs. Add to that over 10 million openings, and if I want to go do something different it’s not terribly hard to do.’
— Danny Nelms, president of the Work Institute
“This [pandemic] has been going on for so long, it’s affecting people mentally, physically,” Mr. Nelms said. “All those things are continuing to make people be reflective of their life and career and their jobs. Add to that over 10 million openings, and if I want to go do something different it’s not terribly hard to do.”
Certain industries are churning more workers than others. People left healthcare, retail and food services at especially high rates at the end of the summer. Workers also left jobs at an accelerating pace across the Midwest and South. Texas and Florida have a high concentration of the industries seeing the greatest churn, including travel and hospitality.
Waves of resignations are typically led by employees with less tenure. The rate of more tenured employees who quit between January and August of this year also increased compared with the same period last year, according to research from workforce analytics company Visier Inc., which studied employee activity for hundreds of thousands of workers across 50 large U.S. companies.
Resignations among those firms were up between 53% and 57% over the same period last year for workers with every length of tenure, up to 15 years, the research showed. Workers between 40 and 50 years old, who are typically less likely to quit their jobs than younger employees, also quit in higher numbers this year, increasing their resignation rates by over 38%, the study found.
LinkedIn said it has seen a 20% jump in searches related to quitting compared with a year earlier. Hashtags such as #greatresignation, #newjob, #jobhunt and #burnout have accrued tens of thousands of followers on LinkedIn.
A March analysis by Gallup found that 48% of the U.S. working population surveyed was actively job searching or watching for opportunities. The survey included workers in every job category, from hourly consumer-facing roles to high-paid professional positions, who were hunting at roughly the same rates.
Applications for new jobs have risen, though not enough to meet demand for labor. Job openings in September were up 86% since January, while applications have risen 8%, according to iCIMS, a recruiting software company that monitors employer and job seeker activity.
Employers have been working to fill roles as experts try to determine the root causes of the exodus, citing everything from extended unemployment insurance to a child-care crisis to vaccine mandates.
Good management traditionally plays an outsize role in keeping employees from eyeing the exits. Gallup found that it took a pay raise of more than 20% to hire most employees away from a leader who engaged them. Women with highly empathetic managers have experienced less Covid-19 related burnout, according to a study released Wednesday by Catalyst, a nonprofit focused on women’s advancement at work.
The Catalyst survey also found 57% of white women and 62% of women of color who feel their life circumstances are respected and valued by their company have never or rarely thought of leaving.
While August resignations hit a record high, before the pandemic people were also quitting at high rates during the hot job market of 2019, as they switched to better opportunities, said Anthony Klotz, professor of business administration at Mays Business School at Texas A&M University.
“Everybody quitting is saying, ‘I became part of the Great Resignation,’” he said. “Some of you were going to quit anyway if this was a normal year.”
London Taxi Firm Offers £5,000 Welcome Salary To Lure Drivers
Addison Lee Ltd., London’s largest taxi firm, is offering 5,000 pounds ($6,861) for four weeks of work to recruit drivers amid a nationwide shortage of staff.
The salary guarantee applies to the first month and requires drivers to complete 140 trips, the company said Friday in an emailed statement. Additional perks include paid days off and a pension.
Brexit has left Britain with a shortage of workers in industries from farming and banking to retail and transportation. A scarcity of truck drivers triggered a fuel shortage and gridlock at the nation’s ports. The government this week eased immigration rules to attract foreign butchers in a bid to ease a severe backlog of pigs awaiting slaughter.
Addison Lee is trying to hire 1,000 drivers after business passenger-car trips jumped more than 40% between August and September. The company expects growth to continue through the Christmas holidays.
Covid Is Forcing Video Game Companies To Rethink Remote Work
Being able to work from home will ease the burden on relocation in an industry where job turnover is high.
Jordan Lemos, a writer for video games, has lived in three different cities over the past five years. He moved from Los Angeles to Quebec to Seattle, working on blockbusters such as Assassin’s Creed Odyssey and Ghost of Tsushima, because the jobs required it. So when he was looking for a new gig last year, he told prospective employers he wasn’t going to do it again. He would only work remotely.
Several big game companies were quick to say no once they heard his ultimatum. But Aspyr Media Inc., the Austin, Texas-based developer behind the highly anticipated Star Wars Knights of the Old Republic remake, was fine with the arrangement, offering a contract that will let Lemos work from his apartment in Seattle even after the pandemic ends.
“Personally, any negatives that may exist from remote work are negligible to the massive amount of positives,” Lemos said. Game studios that refuse to be flexible will have to “see how much great talent they’re missing out on by forcing people to completely uproot their lives,” he said.
Like many industries, especially in the creative and entertainment fields, game production had an entrenched office culture pre-pandemic, where artists, writers and engineers collaborated in person to produce visually stunning content. The hours were often long and the lifestyle grueling.
People complained, but not much changed. Then Covid-induced lockdowns forced a rethink in the video game business, which is slowly conceding that a way of life long considered sacrosanct could see some advantages with change.
The pandemic initially significantly hampered the production of video games as developers struggled to get accustomed to inferior equipment and lagging VPNs at home, leading to widespread delays in releases. But companies adapted, buying new computers and improving their infrastructure so creatives and programmers could transfer large files more quickly.
Now many video game makers say they’re just as productive as they were before the global shutdown in March 2020, even those who have not yet returned to their offices. Studies have shown that once companies can properly support their production pipelines, remote work makes people even more efficient.
Armed with evidence of success, and the release of several high-profile games this year, employees accustomed to the comfort of their own homes are now demanding that their companies rethink traditional stances. Some say that remote work has boosted morale and led to a healthier work-life balance, which has pushed game studios to be more flexible.
A survey this summer by the International Game Developers Association showed that more than half of developers said their employers will continue offering some sort of work-from-home option, a reality that seemed unthinkable just two years ago.
The video game industry is unique in that it has no central hub like Hollywood or Silicon Valley. Big game companies are spread out across the globe, from Canada to Japan to France, which has forced many developers like Lemos to relocate each time they are laid off or their contracts with one studio expire.
A 2019 survey showed that gaming workers had an average of 2.2 employers in five years. The cycle has led to burnout, with many developers becoming sick of packing up boxes and pulling their kids out of school every time they get a new job.
“There are only so many moves you can do before you reach your limit.”
“There are only so many moves you can do before you reach your limit,” Lemos said. “Keeping senior-level folks in this industry is already difficult enough due to things like crunch and burnout. The last thing we need is more reasons for people to leave it.”
Many game companies are still finalizing their plans for remote work post-pandemic. Some, like France’s Ubisoft Entertainment SA, have adopted hybrid schedules, in which the majority of employees must still go to the office at least some of the time, but are allowed to work from home two or three days a week, a routine that’s likely to persist after the pandemic.
But an increasing number of big game studios are doing what was once seen as impossible: hiring people anywhere, with no expectation that they’ll regularly commute to an office again.
One of the biggest developers to make such a change is Sony Group Corp.’s Insomniac Games, based in Burbank, California, which has hired dozens of remote employees and is allowing most staff to work from almost any state, according to two people familiar with operations at the studio who asked not to be identified discussing private company information.
Mary Kenney, a writer at Insomniac, received approval to work remotely and moved to Chicago earlier this year. She wrote on Twitter that the video game industry would be able to attract and retain so much more talent “if people didn’t have to uproot their lives and families for every new project/studio.” Sony declined to comment.
Other companies, such as Los Angeles-based Respawn Entertainment, are telling each of their game teams to decide what fits their approach best, according to two people familiar with the studio. Some staff at Respawn, which is owned by Electronic Arts Inc., plan on permanently working from home.
Others have already moved to new cities, such as Ryan Rigney, the director of communications who said earlier this year that he had received “full work remote approval” and moved from L.A. to Texas. EA didn’t respond to a request for comment.
The French game company Dontnod Entertainment, which also has offices in Canada, said last month that it was offering permanent remote work to all of its 250 employees. In an interview, Chief Executive Officer Oskar Guilbert said the company learned positive lessons from the pandemic that prompted it to change its posture on office work.
“We were able to ship two games during the pandemic,” Guilbert said. “So we thought, ‘OK, it works. Let’s try to continue like this. It seems like it’s a good balance for people’s personal and professional lives.’”
Guilbert said that 65% of Dontnod’s employees are choosing to work remotely moving forward and that even those who remain mostly in the office will be able to work from home one or two days a week. “It makes, I think, employees really happier,” he said. “This is really important. If someone’s happier, they’re really efficient.”
Owlchemy Labs, a small, Google-owned studio that makes virtual reality games such as Vacation Simulator, also recently announced that it was shifting to permanent remote work. Chief Operating Officer Andrew Eiche said employees had benefited from not having to always come into the office and that “our results and quality of work remained really high.”
Another advantage is that as the company grows, “going fully remote allows us to find new and exciting talent across the United States and Canada,” he wrote in an email.
But not everyone wants to work from home. Some game developers said they feel less productive while working from their bedrooms or kitchens, especially while surrounded by distractions such as pets and children. Others said they miss the social and creative benefits that come from in-person collaboration.
Tina Sanchez, lead producer at the new Los Angeles-based independent studio Gravity Well, said she enjoys going into the office one or two days a week to meet up with her co-workers. “There are moments when I want to collaborate with my colleagues and we plan on being in the office at the same time,” she said. “What’s great is we schedule meeting up around how good L.A. traffic is.”
Renee Gittins, executive director of the International Game Developers Association, said some companies won’t be shifting to remote work any time soon. She said she recently spoke to the leadership of one big game studio who said it’s requiring office attendance for most creative and executive roles and that it “hoped having a strong in-office presence after the end of the pandemic would be a draw to potential employees.” She declined to identify the studio.
Game developers who have joined companies remotely “often do not feel completely connected with their teams,” Gittins said. But the benefits, such as eliminating commute time and allowing people to relocate to less expensive cities, have been tangible for many workers, she added.
“There are benefits and drawbacks to both remote work and requiring in-office support,” Gittens said. “I suspect that we will see a large number of studios provide support for remote work opportunities and many smaller studios transition to fully remote work to save on office space costs.”
Some game companies are taking a wait-and-see approach, such as hiring developers in other cities and leaving it ambiguous as to whether they will eventually have to relocate. And sometimes government oversight complicates the plans.
In Quebec, which has attracted thousands of game developers by offering generous tax credits to companies that hire employees in the province, that means publishers like Ubisoft must hit certain staffing thresholds in order to continue receiving the perks. But remote workers wouldn’t count toward those totals, making it more difficult for Montreal-based game studios to be quite as flexible.
Activision Blizzard Inc., the biggest U.S. video game publisher, is allowing its individual divisions to make decisions on a case-by-case basis. A spokesman said the company will offer either a full-time in-office arrangement, a full-time remote arrangement or a hybrid approach, depending on the employee and team. “We are offering a range of options that we believe gives our employees flexibility,” the spokesman said.
The company may be presenting a plethora of choices, but it also makes its preference clear. Activision recently sent an email to employees surveying their vaccination status and saying it hopes to “fully return to our offices by January 3, 2022.”
From Receptionist To Chef And Founder Of A Pop-up Family Kitchen
A pandemic job loss spurred Becca Periera to start Spice Girl Eats, tapping into her lineage of Goan cooks.
In June 2020, Becca Periera gave her Instagram followers a charitable challenge: The first 20 people who made a minimum donation of C$25 ($21.60) to a nonprofit helping Black Torontonians combat food insecurity would each receive a meal of butter chicken, cooked by Periera.
The “overwhelming” response gave Periera, a former model who’d recently lost her job as a receptionist, the confidence to start her own pop-up restaurant in Canada’s largest city. Four months later, she was serving paying customers authentic Goan food through her new venture, Spice Girl Eats.
The name reflects the cuisine of the 23-year-old’s family, which originates from the coastal state of Goa in southwest India, a place known for its coconut flavors and aromatic, spicy seafood. Goan cuisine is less tomato-based than other Indian food and targets all five taste sensations—sweet, bitter, salty, sour, and spicy.
Periera quickly brought her mother on board, a professional chef who was born in the Goan village of Navelim, as head chef and business partner. “As a chef, I was so tired. They really chew you up and spit you out, that’s the industry,” says Corina Periera, a single mother who raised Becca and her three older siblings—also involved in the business. “I took the leap of faith. And now I am much, much happier.”
Customers place their orders on Fridays. Then, Becca and her mother get together on Mondays to cook meals, which customers can collect the following day. They use a book of handwritten Goan recipes passed down from Becca’s maternal great-grandmother, who catered parties and wrote cookbooks for neighbors in India.
In the past year the duo has cooked more than 45 dishes for thousands of customers, Becca says. The company broke even four months in—“a huge milestone,” she says.
And while Spice Girl Eats remains relatively small, it’s attracted attention in the city’s competitive food industry. The team recently did a one-night stint at the prestigious Soho House in Toronto.
The Perieras’ dishes have powerful and tasty flavors, and each stands on its own, says Braden Chong, a co-founder and sous chef of Toronto’s Sunny’s Chinese who has worked in Michelin star restaurants Sazenka and (the former) Inua in Tokyo, and Lurra in Kyoto. Becca’s story is also relatable, which adds to the appeal of a Spice Girl Eats meal, Chong says. “I love what she’s doing, it’s very inspiring.”
On a recent afternoon, the mother-daughter duo are making spicy prawn curry in coconut milk and fluffy jeera (cumin) rice, a typical Goan lunch dish. A pot on the stove sizzles with Kashmiri chilies, green chilies, onions, garlic, ginger, turmeric, cumin, coriander powder, and black pepper.
The aroma engulfs the kitchen, the potent fumes of the chili tickling the throats of everyone in the room. There’s banter, inside jokes, recounting of favorite family stories, and even a bit of conflict. “Sometimes it’s tough in the kitchen,” Becca says, “because my mom is a professional chef and has that experience and I’m the newbie, so I’m learning a lot.”
Initially, Spice Girl Eats had a rotating menu of Goan dishes such as vindaloo, xacuti curry, and potato chops (like a spicy shepherd’s pie crossed with a croquette), along with a few classic Indian dishes such as butter chicken, korma, and tikka masala. The model has evolved with the return of indoor restaurant dining in Toronto, which led to a drop in orders for Spice Girl Eats.
In September the business scaled back its weekly offering to “thalis”—smaller dishes that complement a main meal—instead of a full menu. A thali, which means “plate” in Hindi, is made up of 5-10 portioned dishes placed in tiny bowls—for example, rice, roti, daal (lentil curry), vegetables, chutneys, and pickles.
Last week, the venture launched a line of chai latte concentrates that was nine months in the making. They’re available for pickup at Becca’s home kitchen and at RuRu Baked, an Asian-inspired ice cream parlor that collaborated with Becca over the summer to test out a chai latte ice cream flavor, and she’s in discussions with a few cafes to sell the bottled teas in store.
She’s also started free delivery of the products to some Toronto neighborhoods, and is planning Canada-wide shipping.
The focus of Spice Girl Eats is likely to shift to the product line, Becca says. Rather than offering a weekly meal service, the team plans to take on some catering and one-day pop-ups at prominent locations, as well as collaborations with other chefs. She also wants to spend more time making cooking videos for TikTok.
Becca’s ultimate financial goal for her family is simple: “We can end this cycle of how we grew up—of not having much,” she says, “I want our family to be successful.”
How I Avoid Burnout: An Undertaker Urges Five-Minute Vacations
Seize downtime when you can, find a side hustle you love, and cherish life.
If you find it tough to keep on keepin’ on, consider a day in the life of Elizabeth Fournier. She’s owner of Cornerstone Funeral Services in the small town of Boring, Ore., where she gets about 50 phone calls a day and handles dozens of monthly deaths.
Unlike a Six Feet Under-style funeral parlor, she outsources refrigeration, embalming, and cremation. Fournier’s one-woman chapel and office mixes informal grief counseling with event planning, green activism, and—this being Oregon—eco-friendly services. “People call wanting a home burial or water cremation, or they want to keep their loved one at home for a couple days and need help keeping them cool, or they want to bathe their loved one,” she says.
Fournier handles administration (death certificates, notifying the county and Social Security office), transportation, and obituaries, and she hosts everything from visitations to bereavement yoga to witnessed cremations. For natural burials, she’ll supply the shrouds, shrouding boards, and natural caskets.
This year she has managed large numbers of pandemic-related deaths, including suicides by owners of failing businesses, relapsed addicts, and parents who died back-to-back. “With Covid deaths, it’s not just going to pick up someone who died,” Fournier says. “That person most likely has a family member who is battling their own Covid.” This both complicates and escalates the emotions and logistics. Here are some of Fournier’s tips for avoiding burnout in a stressful line of work.
Self-care is a state of mind. Fournier hasn’t taken a real vacation since she put out her shingle 16 years ago. “I’m in a small town, and I’m the voice people want to hear,” she says.
So she rarely fails to pick up the phone, seizing on moments to slow down whenever she can find them: watching birds on the way to the mailbox; pausing to pet farm animals when visiting rural clients; cranking up the tunes and dancing “like an idiot” when she’s alone in her chapel; calling friends for five-minute check-ins; lingering at natural burial grounds when possible. “These are all five-minute vacations,” she says. “You have to find self-care where it is.”
It’s OK when clients drop the ball. Grieving people are unreliable collaborators. They forget appointments, fail to provide critical documentation, don’t retrieve the remains of their loved one (Fournier keeps a cabinet with 120 urns). She compensates with gentle guidance.
“I’ll call and say, ‘Let’s take a look at your schedule,’” she says. Her secret to gently guiding people into action is letting them know that they’re not alone, and that she’ll hold their hand over the hurdles.
Find engaging side hustles. Fournier breaks up the routine by running workshops, keeping an active Instagram account (@elizabethGreenReaper), doing a TED Talk, and writing three books (The Green Burial Guidebook, The Green Reaper: Memoirs of an Eco-Mortician, and a children’s title for which she hasn’t yet found a publisher). “Side projects are where I paint a bigger picture—I give out my work on a broader scale.”
Price fairly. She previously worked for corporate-owned outfits and still cannot shake customers’ expressions when she told them that prices started at $7,000. “No one has a budget for death. My prices are fair because I want to feel truly good about what I’m doing.”
Any day above ground is a good day. Rejoice: You’re here and breathing. “All the time, people say, ‘She was here, then she went to the store, and now she’s gone.’ It can all be over in a snap,” Fournier says. “If you’re pain-free and don’t have a heartbreak, wow, you’re golden.”
How To Quit Your Job And Get A Better One, From Those Who Have Been There
These professionals took a career break and made it to the other side with new, better jobs. Here’s what they want you to know.
If you have been feeling tempted to say “I quit” recently, you have plenty of company.
Employees are leaving their jobs at record rates: 4.3 million Americans, or 2.9% of the workforce, quit their jobs in August, the highest such percentage ever reported by the Bureau of Labor Statistics. Many of them have no immediate backup plan.
To get a sense of the potential rewards and pitfalls of taking a career hiatus, I talked to people who quit their jobs, took a break and emerged on the other side gainfully employed. They had advice for how to walk away in good standing—for one, keep your network going, even during a break, and have specific goals for your hiatus—and cautioned against mistakes they made and still regret.
Jason Lewis, 38 years old, took nine months out of the workforce, from November 2018 to August 2019. He left his role as an account manager at the software firm Duo Security when its company culture changed from that of a startup, which it was when he joined in 2014, to that of a much larger company after it was bought by Cisco Systems Inc. for $2.35 billion in 2018.
Seeing his peers continue in what he called the “rat race” in the Bay Area made the early days of his resignation tough, he says. But he wanted to use the time to develop as a hip-hop artist and threw himself into his musical interests. He recorded several songs as Oh4Fifty and performed in shows from San Francisco to Austin, Texas.
With that experience under his belt—and in 2019’s red-hot labor market—Mr. Lewis felt ready to go back to his job search in earnest. He contacted several former senior employees at Duo, who put him in touch with founders and teams looking for account managers.
He also cold-called investors at several venture-capital firms. Based on their recommendations, he visited companies with open positions and interviewed with seven of them, ultimately joining Sqreen, a security-software startup, in August 2019, about three months after starting his outreach.
“Frankly, my résumé was never even looked at,” he says of networking his way to his next role.
“Fears over a résumé gap are largely overblown today,” says Anthony Klotz, an associate management professor at Texas A&M University who is credited with coining the term “the Great Resignation” to describe the millions of job departures in recent months. Dr. Klotz says a deliberate gap between jobs can be beneficial both to workers and their prospective employers.
“Healthy transitions involve a clear ending to one role and then a period when you can mentally close that chapter,” he says. He suggests small rituals to mark the end of a job, such as a happy hour and goodbye conversations with close colleagues, to help leave on a high note.
Some who quit without a fallback plan say they built a financial cushion first. Corina Plitt, a 30-year-old mother of two in Spring, Texas, a Houston suburb, resigned from her job as an operations manager at a children’s mental-health facility after her workdays ballooned to 11 hours during the pandemic.
She says she was the only administrative staff member left after a round of furloughs, and there was no meaningful raise to compensate for the extra workload.
Ms. Plitt had saved about half of her income during the pandemic, eliminating much of her spending on vacations, clothes and restaurants. “If you’re financially able to take time off, do it,” she says. “To your job, you’re disposable anyway. But where you’re not disposable is at home.”
After nearly two months off, which she spent with her children and extended family, she got a surprise job offer from a former co-worker, who told her about an opening at a facility for children with autism. She accepted, drawn by what she calls a more family-friendly work culture and more reasonable hours than her last job.
“I actually feel like the people I work with now care about me, and understand what I have to balance as a mom,” she says.
Not every career pause goes according to plan. Jeffrey Korzenik, chief investment strategist at Fifth Third Bank in Chicago, says he has taken two major breaks in his career.
The first was in 1988, soon after the 1987 stock-market crash, when he resigned from his first full-time job as a commodities strategist at E.F. Hutton to go backpacking for two months across a dozen countries in North Africa and Europe. The experience, in his mid-20s, was terrific, Mr. Korzenik, now 60, recalls.
The second break was less fun. In August 2007, he resigned from Salem Five Investment Services, a small firm where he says he didn’t take to the company culture. He thought a new opportunity would materialize quickly, but the global financial crisis happened and his job leads evaporated.
Mr. Korzenik spent five stressful months out of the workforce, this time not as a carefree 20-something but as a father of two with a big mortgage. He credits landing on his feet eventually, at a wealth-management firm, to his large professional network, which he canvassed for any potential openings.
He used to keep a paper Rolodex, but says LinkedIn is now his indispensable networking tool. He recommends cultivating that network constantly, especially if a career break could be in your future.
“If you meet someone interesting in a professional setting, keep the conversation going through messages and emails,” he says. Industry conferences are great opportunities to expand that network, he says, calling one annual gathering for investment professionals in Bermuda his “tribe.”
Having enough savings is even more critical if you are switching fields, veteran career switchers say. It took 31-year-old Bogdan Zlatkov of Oakland, Calif., 14 months to transition a few years ago from videography into content marketing—much longer than he expected. During that time, his $12,000 in savings dwindled to $60 and he resorted to driving for Uber to make ends meet.
If he could do it again, he says he would have tried to continue full-time videography work while using his evenings to apply for marketing roles.
“It may be a little extra work,” he says, “but it’s worth it not to reach rock bottom if things don’t pan out immediately.”
Amazon Seeks To Hire 150,000 Seasonal U.S. Workers
Push to increase workforce comes as U.S. labor market remains tight ahead of holidays.
Amazon.com Inc. is aiming to hire 150,000 seasonal workers in the U.S., a move to get needed workers for the holidays against a tight labor market.
The number of seasonal hires is more than the 100,000 Amazon announced last year and matches the number that rival Walmart Inc. said it would add this year.
The additions build on Amazon’s plans, unveiled in September, to increase its ranks of permanent employees by 125,000. The e-commerce company is also adding 40,000 people to its tech and corporate staff.
Shares of Amazon were about flat in morning trading Monday. The stock is up 4.6% over the past 12 months.
Retailers are working to hire large numbers of staff ahead of the holidays at a time when workers are scarce in many industries. Businesses from stores and restaurants to amusement parks and manufacturers are competing for workers, in some cases offering pay raises, hiring bonuses and other perks.
During the pandemic, some parents have stayed out of work to care for children while they were home from schools and daycare. Other people have taken time off to re-evaluate their priorities. The labor force is smaller, by about 4.3 million workers, than it would be if workforce participation returned to pre-pandemic levels.
Amazon had 950,000 U.S. employees and 1.3 million permanent workers world-wide as of July.
After pay increases rolled out earlier this year, Amazon jobs have an average starting wage of $18 an hour, the company said. Seasonal workers are also eligible for sign-on bonuses and hourly bonuses on some shifts.
Amazon’s seasonal job postings are concentrated in 20 states, including New York, Texas and Virginia. There are 23,000 openings in California, 6,200 in Arizona and 4,500 in Illinois, Amazon said.
Some of Amazon’s largest competitors have also laid out ambitious hiring plans. Walmart said last month it is aiming to add 150,000 people to its U.S. workforce of about 1.6 million. Target Corp. wants to hire 100,000 seasonal workers and around 30,000 warehouse employees.
Shippers, whose role in holiday shopping has leapt with the rise of e-commerce, are growing, too. United Parcel Service Inc. and FedEx Corp. are planning to bring on a combined 200,000 package handlers and other workers.
Googling ‘Job’ Is Once Again More Popular Than ‘Unemployment’
There may be a glimmer of hope for U.S. employers who are facing an acute labor shortage.
“Job” has finally overtaken “unemployment” as a search term for the first time since March 2020, according to data from Google Trends. The number of Americans googling “unemployment” peaked at the end of March 2020, when the pandemic shut down the U.S. economy, and had been hovering above “job” searches until mid-September 2021.
An admittedly untested, but nonetheless interesting, indicator that this process could already be taking place is the fact that search #trends on #Google finally show that more people are looking for “job” than “unemployment” for the first time since the start of the pandemic. pic.twitter.com/BfRiFh9b3z— Rick Rieder (@RickRieder) October 19, 2021
The trend could be a promising sign for the labor market, which has seen a dearth of workers from the restaurant and hospitality industries to trucking and farming. That’s given American workers the upper hand for the first time in decades: Desperate to attract employees, companies have increased hourly wages, offered hiring bonuses and changed job requirements.
“We think it’s likely that transfer #payments and UI #benefits have heretofore enabled workers to refrain/delay reentry to the #labor force, but now that these top-ups have ended, return to work should become more pronounced,” tweeted Rick Rieder, the chief investment officer of global fixed income at BlackRock.
An extra $300-a-week in federal pandemic unemployment helped keep workers on the sidelines, but those benefits ended in all states as of Sept. 6.
Though September was the slowest month of job growth so far this year, applications for U.S. state unemployment benefits fell to 293,000 in the week ending Oct. 9 — the lowest rate since March 2020.
How A Tiny Tearoom In Brooklyn Bounced Back From Covid
The pandemic hammered Jamila McGill and Alfonso Wright’s bustling small business. Then celebrities such as Shonda Rhimes and Beyoncé turned the shop into a social media sensation.
In December 2018, Jamila McGill and Alfonso Wright opened a tearoom in Bedford Stuyvesant, an historically Black neighborhood of stately brownstones in Brooklyn. The couple sought to make their shop, Brooklyn Tea, a local destination with imported teas, fresh coffee, pastries, and a vegan-friendly menu. A year later, business was just starting to pick up, with more people stopping in for tea and treats.
Then the pandemic hit.
“We were told that not only were you not going to go outside, but you also weren’t going to have indoor dining, which at that time was around 85% of our revenue,” Wright says. “We went from a bustling social-gathering place to Jamila and I watching Netflix documentaries in the middle of the day because we had zero customers.”
The pair shifted their focus online, as they already had an e-commerce store integrated into the Brooklyn Tea website. They introduced new products such as an “immunity box” of teas aimed at pandemic-weary customers who wanted to feel more in control of their health, and by the end of May 2020 sales started ticking up again.
Just as important was the Black Lives Matter movement that swept the U.S. As a Black-owned business, Brooklyn Tea was featured by the likes of USA Today, BuzzFeed, and Cosmopolitan. A TV segment in June caught the eye of Shonda Rhimes, the creator of Grey’s Anatomy. “I just ordered SO MUCH TEA.
My favorite discovery of the day,” Rhimes tweeted, tagging the store’s Twitter handle and sharing a link to Brooklyn Tea’s story. The following day, Juneteenth, R&B singer Beyoncé included the couple in her Black Parade Route, a directory of hundreds of Black-owned businesses. Within a month, Brooklyn Tea’s Instagram following almost tripled, to 16,000.
“We went from a store that didn’t see more than 10 sales a month to 100 orders or more a day online,” McGill says.
That created challenges as they struggled to meet customer demand. They converted their basement into a fulfillment center for online orders, and to adhere to social-distancing rules they carved out a night shift so fewer people would be working at the same time.
Web sales have slowed to about 20 to 25 orders a day, still far ahead of pre-pandemic levels. In-store business has rebounded, and the couple is planning a second shop, a franchise run by a friend in Atlanta’s Castleberry Hill neighborhood.
Atlanta felt like the right place to expand, McGill says, given her roots in the city and the many requests sent in by Instagram followers to open a location in the city.
“We built this in a way that was replicable and wanted to expand on the idea of a safe space, community, to host creativity,” McGill says.
McGill and Wright credit the pandemic for giving them confidence and increased brand awareness, and they plan to continue expanding as the business scales. Here are a few of their tips for other small-business owners.
Core values. “If we had taken a moment to just sit down and think about the values we want to share in this space, it could have saved us a lot of headache,” says McGill. This should come before hiring any staff, as clearly stating your purpose and ambitions is key to avoiding miscommunication and keeping everyone on the same page.
Curate an online identity. Find your niche and connect to your digital audience in a way that is informative for them. This may include more pictures of the owners and staff and content that highlights your brand and values.
Cooperate. During the pandemic, the couple joined up with businesses in Bed-Stuy and farther afield to offer joint giveaways and cross-promotions.
An Instagram collaboration with Brooklyn wine and spirits retailer Happy Cork, for instance, features pairings of teas and liquor. “You’re still building your online audience through collaboration even if you aren’t seeing a lot of foot traffic,” McGill says.
Contractors are your friends. Hiring the right people for complicated jobs can save time and money. “When we first started, I tried to put some things together myself, which caused a flood,” Wright says. “I quickly learned that licensed contractors are very important.”
How Working From Home Could Change Where Innovation Happens
For decades, ‘superstar cities’ have been attracting talent and money. But thanks to remote work, their status is likely to change in unexpected ways, bringing tech expertise to places that have long tried to attract it.
In September of 2020, smack in the middle of the pandemic, facing the prospect of a winter confined to her too-expensive apartment in San Francisco, Rumman Chowdhury decided she had had enough of the city.
So, the tech-startup founder made the unlikely decision to move to Katy, Texas—a town of about 20,000 just west of Houston, best known for America’s most expensive high-school football stadium.
A year later, Dr. Chowdhury is working remotely as the director of machine-learning ethics at Twitter , which now allows employees to work from home forever.
Not only does she not regret her move, but she sees herself as the vanguard of a much broader trend: America’s professional classes are moving not just to hybrid but also fully remote work, and at the same time moving out of the urban hubs where people with first-class talents once clustered.
“What’s nice is that I can do everything I have been doing, and live in a nicer, more comfortable environment where I have my own office, instead of cramming it into a guest bedroom,” says Dr. Chowdhury. She bought her home in Katy sight unseen, and discovered only after moving in that it had one more bedroom than she had realized—for a total of five.
Some researchers and industry experts see the trend as a sign of profound change, at least in the tech industry, which traditionally has been one of the most geographically concentrated fields. Many people are moving outside of the usual industry hubs, and they aren’t coming back.
This shift has profound implications for where and how innovation will happen. Tech-company engineers and other professionals moving farther from the office could bring tech expertise to places that have long sought to add it. And big companies in coastal hubs now have the ability to tap into talent pools farther afield.
Could Superstars Lose Luster?
In the before (pandemic) times, America’s hottest talent was lured to cities like New York, Boston, Seattle, San Francisco and Los Angeles by outsize pay packages and the promise of working with other first-string talent.
Now Covid-19 has sent some of America’s hottest talent—and, in aggregate, millions of workers—scrambling for the exits from these large, crowded and expensive “superstar cities.”
Americans have already demonstrated the potential scale of remote work: According to a survey commissioned by the Atlantic, 35% of working Americans, or about 50 million people, were working remotely at the peak of the pandemic-era work-from-home trend, in May 2020.
But it should be noted that America also has a long way to go if the country is to permanently shift to this level of remote work. As of August of 2021, only 13.4% of Americans, or about 20 million people, were still working remotely, according to data from the Bureau of Labor Statistics. (BLS data tends to be at the low end of such estimates, however.)
Many economists think the current exodus of talent amounts to a blip—a temporary shift of workers that belies the long-term power of cities to attract the best and brightest. This migration, they say, largely represents people moving from city centers to suburbs, a change made possible by hybrid work and less commuting, which will have little long-term impact.
But these economists may be missing a key element of the trend: That companies are embracing the idea of remote work because it enables them to hire people from anywhere, and potentially for less money.
According to data from LinkedIn, as of August, the number of jobs that included a remote option was one out of every eight on the site, which is several times the proportion it was a year ago. Out of a pool of about 11 million job postings on LinkedIn, that represents about 1.4 million jobs—including everything from children’s-book editors to anti-money-laundering experts.
Remote work was gaining steam even before the pandemic, which only accelerated its adoption. Adam Ozimek, chief economist at Upwork, which operates a platform connecting employers and freelance workers, calls the ever-growing collection of cloud-based tools that make remote work possible—from Zoom and Slack to Figma and GitHub—a “general-purpose technology,” as important as electricity or the computer itself, that could lead to changes in where people live, how work is done, where innovation happens and how wealth is distributed in the U.S.
In the short term, he says, economic data do indeed indicate that people have mostly moved to the suburbs. But in the long run, he argues, odds are that millions of people are going to leave America’s biggest cities altogether, in search of higher quality of life and lower cost of living.
“The mobility data we have seen certainly suggests that the greatest number of moves have been into the peripheral regions of superstar cities,” says Dr. Ozimek. “But I think we have to consider how households are going to make these decisions and how uncertainty about current remote work opportunities plays into that,” he adds.
In other words, “if a bunch of other potential employers go fully remote, that is really when households can feel more confident about moving far away and giving up access to the superstar-city labor market,” says Dr. Ozimek.
Extrapolating from a September survey of 1,000 hiring managers and other data, Dr. Ozimek projects that 30 million American professionals could be fully remote by 2026.
Matthew Kahn, a professor of economics at the University of Southern California, recently published a paper showing that the pandemic shrank the premium people are willing to pay to live in the center of cities, compared to the suburbs. It’s entirely possible, he says, that this trend will continue, pushing people even farther out of existing superstar cities.
“My thought experiment runs like this: Where would every American live, if they could email themselves to work?” says Dr. Kahn. The answer, he says, is well-run cities with good amenities—no matter how far they are from headquarters.
Obstacles To Moving
But such moves by workers come with challenges. Being able to “email yourself to work” depends on how much the average American professional is able—and willing—to adapt to working far from colleagues nearly all the time, as opposed to just part of the time, as has been common in flexible and hybrid working arrangements.
For one thing, working remotely can bring on isolation and creative doldrums. There is evidence that the pandemic and widespread remote work shrank our networks at our jobs, according to a Microsoft analysis of billions of Outlook emails and Microsoft Teams meetings. One reason this matters: Having more connections with employees outside your team correlates with higher creativity.
But a flood of technologies has arisen to enable remote work, from virtual offices and virtual retreats to virtual business travel, Zoom Rooms and remotely piloted robot bodies for doing blue-collar work from home. Companies that are veterans of running remote workplaces have already found a number of ways to bring employees together both in person and virtually, in order to accomplish what coming to the office regularly once did.
For instance, to reproduce the serendipitous “water-cooler conversations” among team members that offices like Apple’s are famously designed to facilitate, every week Dr. Chowdhury uses a feature of Google Meet that randomly assigns pairs of team members on a group video call to individual breakout rooms.
“We randomly pair people up for 10-minute conversations and there is no goal, it’s just, ‘Hey, how are you, how was your weekend,’ and then it switches,” says Dr. Chowdhury. “It’s like speed dating in a sense, or speed networking,” she adds.
Meanwhile, although leaders of tech companies love to talk about how important innovation is, and how important being under the same roof is to innovation, there is scant evidence that people need to collect themselves in the same place every day in order to collaborate and come up with new ideas.
What’s more, research suggests that the kind of innovation that company leaders are thinking about—the de novo generation of an entirely new product or technology—is incredibly rare. The kind of innovation that actually drives the bottom line, what you might call everyday innovation, is collaborative and incremental, precisely the kind of steady grind carried out by a small group of employees.
A year and a half of data on the increased productivity of remote workers suggests current collaboration technologies are more than capable of facilitating collaboration.
Creating New Hubs
As professionals working for America’s most productive companies leave superstar cities, or never move to them in the first place, the new geography of innovation, and the local economies that benefit from the wages of those who create it, could also be dispersed.
It would be one thing if workers simply dotted the landscape, choosing new places to land willy-nilly, but there’s every indication that they will cluster anew, but using different criteria. Cities of the future will have to compete on amenities like good governance, access to the outdoors, better parks and entertainment, says Dr. Kahn, echoing work by the economist Ed Glaeser . The flood of coastal expatriates with jobs in tech to places like Boise, Idaho, seems to back up these assertions.
This effect could be especially powerful for tech companies, which are in the best position to leverage existing remote-work technologies, build their own and even sell some of those tools to others. Google’s cloud-based productivity tools and Amazon Web Services were both born of internal needs, after all, and are both now essential to remote work at millions of companies.
Who knows which of the new crop of remote-work technologies being developed by tech companies large and small, from virtual reality to telepresence, will expand the pool or enhance the productivity of remote workers next?
The paradoxical result of widespread remote work is that it represents both a centralization and a decentralization of where new technologies are built. That is, even as workers disperse geographically, more of them are doing their work in a single place: the internet. This change is already helping Silicon Valley giants break through logjams like regional housing crises in order to poach talent wherever it lives.
The team Dr. Chowdhury has built at Twitter in the past six months embodies this trend. “I am not limited to hiring people in San Francisco. Do you know how amazing that is?” she says. “My team is in every U.S. time zone, as well as the U.K. If we went back to an office, where would it be?”
The Coming Electric Car Disruption That Nobody’s Talking About
From metal fabricators to auto mechanics and corn growers, the coming era of electric vehicles will upend jobs across the economy.
An acrid smell hangs in the air at Trenton Forging Co. on the outskirts of Detroit as a 4,500 pound hammer slams a bar of red hot steel with enough force to shake the building.
A worker uses tongs to position the piece, heated to 2,200 degrees, under the hammer, then onto a conveyor belt. The process is repeated 7,000 times a day at the 90-employee plant, resulting in fuel rails that feed gasoline to injectors.
But the days of forging fuel rails is numbered. They’re among hundreds of parts in internal combustion engines that won’t be needed when the country transitions to electric vehicles, a fact that isn’t lost on Dane Moxlow, the vice president of Trenton Forging, whose grandfather started the business in 1967.
“This might go away completely,” Moxlow, 33, said as a pair of workers behind him inspected a freshly made rail. “Is it something we worry about? Yeah. But it’s also something we plan for.”
Across the country, thousands of companies such as Trenton Forging are warily eyeing a future of electric vehicles that contain a fraction of the parts of their gasoline-powered counterparts and require less servicing and no fossil fuels or corn-based ethanol. It’s a transition that will be felt well beyond Detroit, as millions of workers at repair shops, gas stations, oil fields and farms find their jobs affected by an economic dislocation of historic proportions.
“Anybody who thinks this transition is going to go smoothly is fooling themselves,” said Michael Robinet, executive director of automotive advisory services for consulting firm IHS Markit.
Making, selling and servicing vehicles employ an estimated 4.7 million people in the U.S., according to the Bureau of Labor Statistics. Some of the jobs won’t go away, of course — there will still be a need for dealerships and tire shops.
Auto Industry Employment
Making, selling and servicing vehicles employs an estimated 4.7 million people in the U.S.
Making the massive batteries that line the bottom of electric cars promises to employ thousands. But where a conventional car’s engine and transmission have hundreds of parts, some electric-vehicle powertrains have as few as 17, according to the Congressional Research Service.
That doesn’t take into account the radiators, fuel tanks or exhaust systems that electric vehicles don’t need. Once operating, an electric car has no spark plugs or oil that need changing or mufflers that wear out. And with so few moving parts, service stations could be relegated to changing tires and windshield wipers.
Conventional cars will probably remain on the road for years, softening the blow for repair shops and other affiliated industries. But with an average lifespan of 12 years, the trend lines for gasoline-powered vehicles will be heading down.
The shift will reduce demand for oil nearly by 4.7 million barrels a day by 2040 in the U.S. alone, according to projections by BloombergNEF. That’s about 26% of U.S. consumption, roughly equivalent to the amount that Germany and Brazil combined consumed daily in 2020.
Less gasoline being sold also means the need for ethanol, which is blended into motor fuels and consumes a third of the U.S. corn crop, will also fall.
If the story of U.S. economic history is one of constant creative destruction — as gasoline engines displaced steam, plane travel trumped trains, plastic ate into steel demand, imported goods idled U.S. factories — the coming shift is still remarkable in its scope.
“It’s a disruption that people cannot appreciate,” said Paul Eichenberg, managing director of Paul Eichenberg Strategic Consulting. “Truly the engine and transmission becomes the buggy whip of the 21st century. But if you look at the other industries, it will have a huge impact.”
That future is fast approaching. General Motors Co. has vowed to sell only zero-emissions models by 2035. Ford Motor Co. said it expects 40% of its global vehicle sales volume to be electric by 2030 and Stellantis NV, the successor to Fiat Chrysler, has said it is targeting over 70% of sales in Europe and over 40% in the U.S. to be “low emission vehicles,” meaning either electric or hybrid, by 2030.
The Biden administration is enthusiastically encouraging the transition, which it sees as a key to combating climate change. It is proposing an array of incentives and has ordered the federal government to electrify its fleet. Transportation is responsible for about a third of the greenhouse-gas emissions in the U.S., making it the largest single sector, according to the Environmental Protection Agency.
“The future of the American auto industry is electric,” President Joe Biden said in front of a bank of electric vehicles on the White House lawn in August. He then signed an executive order setting a goal of having half of all vehicles sold in the U.S. be emission-free by the end of the decade. China, he said, is winning the race to make electric vehicles and the U.S. must catch up.
In many ways, the U.S., where only 2% of vehicles sold are electric, is a laggard. France plans to ban internal combustion engines in 2030, and China and Britain will do so by 2040. India says it is setting an “aspirational target” of all-electric sales by 2030.
The United Auto Workers union, seeing the handwriting on the wall, is gearing up for a fight over who gets to make the batteries that power the vehicles, said Bernie Ricke, the silver-haired president of Local 600, which represents workers at the Ford plant where the F-150 pickup truck is made.
“You can like it or not like it — it’s coming,” said Ricke, during an interview from his office in the shadow of Ford’s massive 1,100-acre plant, where a conventionally powered pickup truck rolls off the assembly line every 53 seconds.
Nearby, a nondescript white warehouse with blue bay doors is being outfitted to make the Lightning, as the electric F-150 will be known.
At the event on the White House lawn in August, Ricke introduced Biden and stressed the need to protect union jobs.
“We know that President Biden understands that, as we move forward, our workers will not be left behind,” he said, pointedly. “We know that President Biden has our back.”
The UAW, which has estimated the shift to electric could result in the loss of 35,000 union jobs, says it is taking a realistic approach and is pushing for protections for workers. That includes commitments that jobs be located in the U.S. at comparable wages and benefits.
“We’re not running from and fighting technology that everyone sees is coming,” said Jeff Dokho, director of research at the union’s headquarters. “We’re saying if you’re going to take taxpayer money, you need to have the gold-standard jobs like building powertrains. We’re pushing for ‘If you’re going to take government money, the other side is there need to be good jobs in those communities.’ Our focus has been to try to attach labor provisions wherever we can.”
“Just like in China and Europe, for all this to work, there needs to be a big public investment,” Dokho said. “We feel like in the current environment, we should have strings attached.”
From his City Hall office across the street from from GM’s Global Technical Center, Mayor Jim Fouts of Warren, Michigan, ticked off a list of benefits and investments that electric vehicles had brought. Chrysler is planning to re-open a plant in town to produce an electric version of the Jeep Wagoneer and with it 6,000 jobs, Fouts said.
“Most of the development going on in Warren is related to electric vehicles and batteries,” said Fouts, a bespectacled 78 year-old, whose age is belied by a twice-a-day running habit. “There is a greater realization by more and more people that the time is now to go into something that will not harm the environment which is what fossil fuels are doing.”
Still, Fouts said, some of Warren’s 134,000 residents were worried about the future.
“There is a lot of reticence about whether automation and electric vehicles will replace their jobs,” Fouts said. “I think with training they will be OK.”
Dan Turke, a 50-year-old millwright for Stellantis, takes a philosopical view.
“Electric vehicles are great,” said Turke, wearing safety goggles and carrying a thermos as he prepared to start his shift at the company’s 3.31 million square-foot Warren Truck Assembly Plant. “Somebody’s still got to build them.”
But the jobs created won’t necessarily resemble the ones lost, said Eichenberg, the consultant, who is a former executive for auto part supplier Magna International Inc.
Parts such as transistors and capacitors and high-voltage battery packs are manufactured in much different ways — meaning a worker on an engine manufacturing line can’t simply switch to making batteries.
“It’s like comparing apples and oranges,” Eichenberg said. “They are chemical companies, they are materials companies and, as you have this change, there is just a fundamental difference.”
The Motor & Equipment Manufacturers Association, which represents parts suppliers such as Valeo North America and Robert Bosch LLC, estimates that the U.S. auto parts industry could lose as much as 30% of its workforce or nearly 300,000 jobs when the transition is complete.
“Suppliers, the UAW, lots of folks are right to be concerned,” said Ann Wilson, a senior vice president at the association. “The reality is the transition is going to occur whether they are concerned or not.”
The coming change could be likened to the electrification of America in the early part of the 20th century, when the nation began switching from the steam power to electricity, said Theodore DeWitt, University of Massachusetts Boston professor of management.
That change required factories that no longer needed giant steam engines in the middle of their plants to retool, but it also created new jobs, including ones that didn’t exist before, such as electrician. For a time, that became largest occupation in the country, DeWitt said.
“I don’t think there is a case for industrial transformation where we haven’t lost jobs and created others,” DeWitt said. “There will be jobs that didn’t exist before.”
The transition is already creating opportunities. GM and South Korean-based battery maker LG Energy Solution announced in April they would build a $2.3 billion battery plant in Tennessee to supply the automaker’s electric vehicle. Bill Lee, the state’s Republican governor, said it was the “largest single investment of economic activity in the state’s history.”
The plant will employ 1,300 people when it begins production, and it represents the second joint venture for the two companies. GM and LG Energy already are constructing their first vehicle-battery plant in Lordstown, Ohio. That plant will employ more than 1,000 workers and supply batteries to Factory Zero, an electric-truck factory near Detroit.
Stellantis and Korean battery-maker Samsung SDI on Thursday announced plans to build a factory in the U.S., adding to the automaker’s battery projects in North America.
“This is net job creator for whoever captures the race for global clean transportation,” said Joe Britton, executive director of the Zero Emission Transportation Association, which represents electric vehicle makers such as Tesla Inc. and Lordstown Motors Corp. “We have a huge opportunity to invest wisely and that’s what our foreign competitors are doing.”
Yet the transition will result in winners and losers. Metal forging is in the latter category. Fully a quarter of the a $90 billion the industry generates each year comes from vehicle parts such as rods, crankshafts, gears and drive shafts.
For Joseph Schwegman, president of Quality Steel Products in Milford, Michigan, that means finding new products to replace the torque converter hubs, a disc-like transmission component, they now make. They won’t be needed in an electric vehicle.
The 40-person forging company is considering making hand tools like pliers and is also examining whether existing parts they make, like D-rings, can be used to hold vehicle batteries.
“We are going to be a lot more aggressive in looking at other opportunities,” Schwegman said, as sparks from a metal grinder showered the factory floor behind him. “We want to continue to diversify.”
These 7 Habits Will Keep Your Mind Sharp No Matter How Long You Work
Age is just a number: What doctors think will keep you on your toes.
When Ronald Reagan was running for president in 1980, there were questions about his age and whether he was up to such a stressful job. After all, the Gipper would turn 70 less than a month after being inaugurated. 70? The oldest president up to that time had been Dwight Eisenhower, who had retired at that age in 1961 after serving two full terms.
These days though, Reagan would be just a kid compared with our leaders. President Joe Biden was elected at 78, replacing Donald Trump, who was elected at 70, and is dropping hints about running in 2024, when he would be 78. On the other end of Pennsylvania Avenue, House Speaker Nancy Pelosi is 81 and Senate Minority Leader Mitch McConnell is 79. Across the street from the Capitol, Supreme Court Justice Stephen Breyer is still on the job at age 82.
You get the idea. Here we are, well into the 21st century, in a high-tech digital age, where bits and bytes move in nanoseconds, and yet the people leading us into this rapidly changing, constantly evolving new world are in their eighth, and in some cases ninth and nearly 10th decade of life (I’m looking at you, Iowa Republican Sen. Chuck Grassley, who at 88, says he’ll seek another six-year term, and California Democrat Dianne Feinstein, also 88, who said recently that she has no plans to step down).
No disrespect to anyone. But these are tough jobs. How old is too old to do them? And what about the rest of us who will work—either by choice or necessity—well into the future?
Which brings us to a novel idea, albeit one that will get absolutely nowhere in Washington: An senility test for government officials of a certain age. That’s the brainchild of Sen. Bill Cassidy, Republican from Louisiana, who also happens to be a physician.
In an interview with the news service Axios, which aired on HBO, Cassidy didn’t give a specific age for such tests, but said that for many people in their 80s, that’s when their “rapid decline” begins.
“It’s usually noticeable,” he said. “So anybody in a position of responsibility who may potentially be on that slope, that is of concern. And I’m saying this as a doctor.” The senator’s office did not respond Monday to a request to elaborate.
But this decline actually has its roots at a much younger age. As many as one-in-six Americans as young as 60 are living with what’s known as “mild cognitive impairment,” or MCI. That’s according to the Alzheimer’s Association, which says “mild cognitive impairment causes cognitive changes that are serious enough to be noticed by the person affected and by family members and friends,” though this “not affect the individual’s ability to carry out everyday activities.”
But after 60, things can quickly deteriorate. In its 2021 annual report, the association says that between the ages of 65 to 74, an estimated 5.4% of Americans has Alzheimer’s dementia, which increases to 13.8% of those aged 75 to 84 and then 34.6%—more than one-in-three—of those aged 85 and older.
It also notes that people younger than age 65 can also develop Alzheimer’s dementia, “but it is much less common and prevalence is uncertain.”
So one-eighth of Americans between 75 and 84 and one-third over age 85 have Alzheimer’s dementia. But the data is not distributed evenly, meaning that Blacks and Hispanics are more likely to develop Alzheimer’s dementia than Whites. “This higher risk, or incidence, of Alzheimer’s and other dementias appears to stem from variations in medical conditions, health-related behaviors and socioeconomic risk factors across racial groups,” the Alzheimer’s Association says.
But you can turn these odds in your favor by practicing certain healthy habits, says William R. Klemm Ph.D., a senior professor of neuroscience at Texas A&M University. He offers these tips:
* Get better organized. Keep your keys, for example, in one place all the time. “Life is simpler when you have a place for everything,” Klemm says. Habit relieves the memory.”
* Challenge yourself mentally. “Seek out new experiences, stay active socially, make mental demands on yourself, such as learning a new language, playing chess, or getting an advanced college degree,” Klemm says.
* Reduce stress. “Chronic stress(emotional pressure suffered for a prolonged period of time in which an individual perceives they have little or no control) clearly disrupts memory formation and recall,” he writes.
* Eat foods with vitamins and antioxidants. Focus on vitamins C, D, and E. Like many experts on aging, he says you should eat blueberries, “especially on an empty stomach.” What about vitamin supplements? They won’t help, Klemm says, unless you have a nutritional deficiency. Focus on food.
* Avoid obesity. Weight increases stress on the heart and arteries, which pump oxygenated blood to your brain, which helps you retain mental sharpness.
* Exercise. Enough said. Keeps the blood flowing, and the pounds off. Talk to your doctor first.
* Get plenty of sleep. “Many studies show the brain is processing the day’s events while you sleep and consolidating them in memory,” Klemm says. “Naps help too!” He adds.
Naps? Count me in.
A Pandemic Pastry Flirtation Becomes A Real Business In London
The founder of Buns From Home on the challenges of building a nationwide following.
To weather last year’s coronavirus lockdown, Barney Goff started Buns From Home, making cinnamon, cardamom, and cream-filled rolls in his mother’s kitchen, promoting them via an emailed newsletter, and delivering them by bike around London’s Notting Hill.
The pastries quickly became a hit, developing a fan base across the U.K. that includes Olympic athletes, foodie Nigella Lawson, and musician Lily Allen.
In September, Goff opened a shop on Portobello Road, with a staff of eight and lines that frequently stretch out the door. We spoke with Goff about the explosive growth and the hurdles he has encountered. Edited excerpts from the conversation follow.
Where Did You Learn To Bake?
I had been working at a cafe. I would get up in the morning, make pastries, and then go off to the West End to do my normal nine-to-five at a marketing firm.
At The Beginning, How Did You Promote Buns From Home?
In March, I printed some flyers to tell the story. I didn’t really expect to get any orders, and then suddenly I had a full inbox. I completely messed up because I had handed out thousands of flyers and then suddenly had hundreds of orders. Every week I would email to let customers know what the special was, and that created a snowball effect that kept prompting people to reorder.
Can You Tell Us About The Early Growth?
I did the first couple of deliveries myself, and then I had my brother helping and then some friends. Everyone would come in the morning at around 6:30, load up their trailers, and go around London. We were doing a couple of thousand pastries a week after about six weeks.
Why Did You Decide To Open A Storefront?
My mum decided to move house, which meant I didn’t have anywhere to bake. I was really nervous because I thought, well, we do deliveries, and because of lockdown, retail isn’t very strong. All our products were deliverable, so the shop seemed sort of pointless. But we had to take the plunge. And the shop quickly overtook delivery.
Did Things Change When You Opened The Shop?
At the start I was doing everything. I was making everything and also serving at the counter. It was just me, and my mum would cover for an hour at lunch so I could have a nap, and then I’d be at it again. For two months, I was working from 3 a.m. to 9 p.m. every day. We now have four chefs and two employees serving at the counter, and my mum still works at the shop five days a week. To get it going I had to work impossible hours. Nothing beats hard work.
Has Money Been A Problem?
We built the entire business piecemeal and didn’t have to take out any loans. We were able to fund the rent from a mixture of profits and preselling lots of pastries to our customers. And we had a tiny investment from one of them.
You Have A Strong Presence On Instagram. How Has Social Media Helped The Business?
It’s one of these things that’s really tricky to measure. The newsletter has been absolutely incredible for us, but in terms of direct sales, I can’t see a massive correlation. But we get a lot of comments like, “Oh we saw this on Instagram.”
How To Squeeze In A Side Hustle Without Losing Your Day Job
Organization and communication are critical to managing multiple occupations.
To hold down a full-time job and run a small business on the side, you have to have a knack for planning. The schedules of four high achievers who do it reveal a commonality: the more project-based the work, the easier it is to fit in multiple occupations. Here’s how their weeks look:
Who: Brandon Williamson
Night Job: Private residence ambassador for the Waldorf Astoria Chicago. “It’s similar to a concierge but for the condo owners in the building.”
Small Business: PRSVR, which makes hip high-end clothing. Williamson is designer and logistics manager for the brand, and his wife, Margaret Williamson, is chief executive officer. “She does client requests, finance, and day-to-day emails and calls. I create the product, do manufacturing and quality control.”
Why Multiple Jobs: “Passion. I grew up in streetwear culture, and I wanted to create from my point of view.”
Schedule: The Waldorf overnight shift from 10 p.m. to 6:30 a.m.; at PRSVR from 2 p.m. to 6 p.m. He trades off child care of their three kids, ages 1 to 8, with his wife. “I’m extremely tired, and it does remove the time for any external relationships, but being able to parent in a hands-on way takes away the desire to complain.”
Expert Advice: Partner with your spouse. “It helps to work with someone who has the same things to lose as you—our moods are based upon how we treat each other.”
Week On/Week Off
Who: Patricia Kavanagh
Day Job: Practicing neurologist. Kavanaugh treats patients in Brooklyn, N.Y., where she specializes in Parkinson’s disease.
Small Business: Foray Design, which sells Spring, a walker for active people. She’s chief operating officer. “I can do a lot of it from our house upstate, since everything’s on Zoom now.”
Why Multiple Jobs: To help people. “My patients with mobility problems wouldn’t use walkers, and it dawned on me that the problem was not the people, but the device.”
Schedule: She sees patients one week and focuses on Foray the next week. “I’ve learned that the tempo and the intellectual demands are so different,” Kavanagh says. “When I’m seeing patients, I really can’t stop to take a business call.” She continues to handle patient communications and prescription requests daily, and on Foray weeks, her neurology staff catches up on administration.
Expert Advice: Keep experimenting until the schedule feels good. “For years, I did variations on spreading patients out and doing a little business in between, and that was so inefficient.”
Day Job + Evening Hours
Who: Cory Young
Day Job: Senior business analyst at Campbell Soup Co., where he works with the tech and digital marketing teams.
Small Business: BCC Interactive, a Philadelphia-based digital marketing agency. Young is founder and CEO. “I do a little bit of everything—client delivery, financials, process.”
Why Multiple Jobs: To make extra cash helping smaller companies with search engine optimization. “I enjoy making decisions that I was not as free to make in my day-to-day. And I wanted a little pocket change.”
Schedule: Each morning, Young checks in with both teams. He mostly works at Campbell 9 a.m. to 5 p.m., with some agency communications sprinkled in. “I’ll Slack with my BCC team and do a client call at lunch.” Evening is agency time.
Expert Advice: Get a virtual assistant. “Organization is invaluable,” Young says. “I didn’t figure it out until agency meetings got thrown on my calendar that I couldn’t make because of full-time job obligations.” He snapshots his noncompatible Campbell and agency calendars each Sunday and sends them to his virtual assistant who combines them and makes sure he is not double-booked.
Who: Suzie Qualle
Day Job No. 1: Operations manager for lawn and snow maintenance company Land to Snow, where she handles everything from the books to recruitment to the website.
Day Job No. 2: HR Consultant at oil and gas technical services company CenerTech Canada, working remotely on projects such as policies and handbooks. “It can sometimes be a 40-hour week, and if that’s the case, I just ask my other boss if I can focus on that for a week and squish things in.”
Small Business: Grounded Revival, where she makes prayer beads by hand.
Why Multiple Jobs: She worked 9-to-5 for a decade. “I was absolutely miserable,” Qualle says. “There’s joy in accomplishing things with my own hands that I can’t get working for someone else.”
The Schedule: A bouillabaisse. She gathers her project deadlines, then schedules in backwards, including non-negotiable family time from 6 p.m. to 8 p.m., plus meditation, exercise, and unexpected task time. Staying on top of assignments is a must. “Procrastinating until everything builds up and implodes on you is a very stressful way to live.”
Pro Tip: Be transparent with bosses and prospective employers about your commitments. “As long as you’re constantly communicating with them, they’re OK with it.”
CFOs Plump Salaries, Perks To Land Elusive New Employees
Amid the ‘Great Resignation,’ companies have to offer compensation that stands out in order to draw new workers—and hold on to the ones they have.
Finance chiefs are boosting salaries and recruitment spending, offering more in the way of perks and expanding their equity plans as they joust to attract—and retain—workers.
Employees have quit their jobs in droves this year as the economy has picked up after last year’s pandemic slump. Workers handed in a seasonally adjusted 4.3 million resignations in August, a record since tracking began in 2000 that came after months of elevated departures, according to the Bureau of Labor Statistics. Jobless claims last week dropped to the lowest level since March 2020.
The “Great Resignation” is exacerbating skills shortages across industries and forcing companies to pay more, driving up costs at a time of already high inflation.
In a survey released last week, chief financial officers at U.S. businesses said quality and availability of labor was their No. 1 concern, with three-quarters of them stating they have difficulty hiring, according to Duke University’s Fuqua School of Business, which conducted the poll with the Federal Reserve Banks of Atlanta and Richmond.
Companies plan to keep hiring new workers and increasing non-wage compensation—for example, for healthcare and other benefits, the survey of 301 CFOs found. Wage bills are forecast to rise by 6.9% this year and next, while wages for new hires are set to rise by about 10%, according to the survey.
Companies across the country—discount retailer Big Lots Inc., furniture retailer MillerKnoll Inc., food distributor Sysco Corp. and software firm Autodesk Inc., among others—are wrestling with the situation.
Columbus, Ohio-based Big Lots has increased wages in certain locations, offered heftier employee discounts and doubled its referral bonuses to $500. In September, the company upped its hourly rate for workers by $3 to $18.50 at its Tremont, Pa., distribution center, in part due to intense competition for warehousing staff in the area, CFO Jonathan Ramsden said. He is also evaluating wages in other locations.
“We need to be tracking the number of stores that are understaffed,” he said, adding that this is a “week-by-week, almost day-by-day exercise.” Big Lots declined to state how much it spends on retention and recruitment.
The company’s average rate for hourly workers is about $14, a “low-to-mid” single-digit percentage increase from a year ago, Mr. Ramsden said. Big Lots has about 35,000 employees and plans to increase its head count by 3% to 4% next year as it opens new stores, he said.
MillerKnoll, the Zeeland, Mich.-based manufacturer of office chairs and other furnishings, has increased wages for most of its factory workers in North America over the past few months, CFO Jeffrey Stutz said. The company, formed this year when Herman Miller Inc. bought design firm Knoll Inc. for $1.8 billion, also raised salaries for employees in non-production roles.
Labor costs during the quarter ended Aug. 28 went up by $5 million compared with the prior-year period due to higher wages and overtime pay, Mr. Stutz said, adding that the company expects to spend less on overtime once current conditions ease.
Recent salary increases, however, will likely remain in place, according to John Graham, founder of the CFO survey and a professor of finance at the Fuqua School of Business.
“We expect these salary increases to be permanent,” Mr. Graham said. “And they absolutely increase costs for the firms, putting pressure on the firm to increase prices of their own products and thus increasing inflation.” In recent months, MillerKnoll has raised prices to offset higher costs, including for labor.
Salary growth at companies in the S&P 500 has been flat in recent years, with median compensation per employee totaling $70,496 in 2020, up from $68,410 in 2017, according to MyLogIQ, a data provider.
Houston-based Sysco, which serves businesses including restaurants, hotels and hospitals, spent $36 million on recruiting, training and retention during the quarter ended July 3. It expects those costs will remain elevated through at least the end of 2021, CFO Aaron Alt said. The company declined to comment on its past spending on those efforts.
In addition to bonuses, Sysco plans to launch a driver-training program to help new hires and other employees get a commercial driver’s license.
“We’re taking active steps…so that what should be transitory does not become permanent,” Mr. Alt said. Sysco had about 58,000 employees as of July 3, up 1.8% from a year earlier, according to a filing.
The worker shortage also complicates matters for CFOs looking to fill positions in their finance departments. Autodesk, the San Rafael, Calif.-based provider of software applications, has over 1,000 open positions, including two roles for vice president of finance.
“It feels like the balance of power has changed from the recruiter to the recruit,” CFO Debbie Clifford said. “I have never seen a market like this in my career.”
Ms. Clifford herself in March left her previous CFO job at the parent company of SurveyMonkey, SVMKInc.—which recently changed its name to Momentive Global Inc.—to take on her current role. In the past 90 days, she released additional funds for recruiting and is reviewing compensation for finance workers to ensure it is competitive. She said she also spends more time talking with prospective candidates.
Lithia Motors Inc., a Medford, Ore.-based chain of car dealerships, recently launched a rotation program for graduates in its finance department, CFO Tina Miller said. The company, which employs about 900 people in finance, also has a similar program for data analysts.
“It’s definitely competitive out there,” Ms. Miller said.
Apart from higher salaries, training and perks, companies are building out their equity packages to attract and retain talent. Todos Medical Ltd. , a biotech firm based in Israel, recently gained shareholder approval to create an employee options plan, CFO Daniel Hirsch said. The company plans for its options to vest after four years.
“That’s the kicker to make people stay,” Mr. Hirsch said.
In October of last year, Autodesk went in the other direction, overhauling its equity awards and expanding them to all employees. A third of shares now vest after one year of employment, and the rest on a quarterly schedule after that, “enabling employees to realize the benefit of their equity sooner and more often,” a spokeswoman said.
The three-year vesting schedule “is a differentiator versus other tech companies” that vest on a four-year schedule, she added.
Holding Out For The Right Job? Don’t Dawdle Too Long
Yes, employers are desperate right now. But the longer workers sit it out, the more likely businesses will have permanently adapted to the labor shortage.
The U.S. is in the midst of “a great reassessment of work,” so say the headlines. Covid-19 has led people to “rethink their careers.” Because of the pandemic, we now know “how much we hate our jobs.” The “Great Resignation” is sweeping through the labor market.
Let’s hold our horses. The unusual circumstances of the U.S. labor market that have led to the “Great Resignation” are likely temporary. And there are good reasons to be grateful that this won’t last.
The “great reassessment” moment is happening in an economy with an unusual imbalance between demand and supply. Demand is surging. Consumer spending on goods was 15% higher in August than in February 2020, the month before the pandemic hammered the economy.
This is fueling white-hot demand for workers. There were 10.4 million job openings in August, up from 7 million in February 2020.
At the same time, the supply side of the economy can’t keep up. Supply-chain problems are making it harder for goods to reach shelves. And many workers are on the sidelines.
The rate at which people ages 25 to 54 — generally speaking, people who are too old to be in school and too young to be retired — are participating in the workforce is only a bit higher than it was in the summer of 2020, and is still 1.5% lower than its February 2020 level.
This imbalance means employers are chasing workers, who in turn have gained a lot of leverage in the labor market. This is leading workers to quit their jobs in large numbers, confident they will be able to find new and better jobs.
In August, 4.3 million workers quit their jobs — the highest number on record. It is also leading some to question whether they want to continue working at all.
But this situation probably won’t last because the circumstances that have created it will fade over the next year. Demand is so strong because of huge government stimulus payments to households (President Joe Biden’s $1.9 trillion March stimulus law was a forecastable mistake) that overlapped with the economy gradually normalizing.
Households are sitting on around $2.5 trillion of excess savings, pumping up demand. Adding to the cushion were generous unemployment benefits.
Workers are on the sidelines not only because they are confident they can get another job. The pandemic continues to discourage their return to normal life.
According to a Census Bureau survey from late September, 4 million were home sick with Covid symptoms or caring for someone in the same situation, 3 million weren’t working because they were worried about Covid, and 5 million were at home looking after kids not in school or day care.
The same stimulus checks and generous unemployment benefits that have pushed up economic demand are also slowing workers’ return to jobs.
None of these factors will last. Over the course of 2022, demand for goods will moderate, and supply-chain bottlenecks will ease. Excess savings will be depleted. As the danger of Covid continues to fade, school attendance will be more predictable. Generous unemployment benefits have already expired.
As the economy normalizes, workers will have considerably less leverage in the job market than they currently enjoy. So-called “dead-end jobs” will look more appealing without thousands of dollars of unemployment benefits arriving in checking accounts each month. People without jobs will be less choosy when their savings account balances come back to earth.
A sustained change in the labor market situation, including wage growth that endures, would require something different from a temporary demand-supply balance — for example, workers increasing their productivity through acquiring more skills. As the economy normalizes, so will the distribution of bargaining power between workers and employers.
The part of the “Great Resignation” that could last are early retirements, driven in large part by pandemic savings, the stock market boom and home equity gains. But even that could reverse to some degree.
This may sound like bad news for workers, but the sooner it happens the better for those who are idle for pandemic-related reasons. Though there are around 7 million fewer jobs than there should be right now, economic output has exceeded its pre-pandemic level, and is growing rapidly.
The upshot is that businesses have figured out how to produce goods and services with many fewer workers. The longer workers sit it out, the more businesses will have permanently adapted to the labor shortage.
Those who wait too long for the right job might find themselves with no job.
Consumer Perceptions Of The Job Market Are Close To Hitting The Best Level Ever
The pace of U.S. job creation in recent months has come in below economists’ expectations. But it doesn’t appear that a lack of job availability is the big issue. In fact, from a public-opinion standpoint, it’s close to the best environment in history.
In the Conference Board’s latest Consumer Confidence survey (which came in above expectations), the so-called Labor Differential Index (which measure the gap between people who think the labor market is good versus those who think the labor market is bad) hit a new post-crisis high. And at 45.00, the number is just shy of the all-time record set in 2000, when it hit 46.2.
While this is a good sign for job seekers, it may give hiring managers headaches. Over the last couple of decades, this measure of labor-market confidence has been closely aligned with the quit rate, which of course makes sense. If you perceive the labor market to be strong, you’re more likely to quit your job for another job (or even without a job, but knowing that getting another one will be easy).
Dubai Is Bait In War For Coder Talent Fought By Israel Firms
One of Israel’s fastest-growing technology firms is opening a Dubai office to lure international talent as a way around the chronic labor shortage plaguing the industry at home.
Rapyd, a payments firm that twice raised $300 million in funding rounds this year, started a large advertising campaign this week targeting coders in eastern Europe open to relocating to the Middle East financial hub, where the standard of living is higher and which imposes no income tax.
It’s a remedy that may increasingly appeal to other startups navigating a market where job openings far outnumber applicants as record investment pours into Israel.
Chief Executive Officer Arik Shtilman said in an interview that Rapyd plans to staff about 100 people in the new branch within 18 months. More than 10 Israeli startups have already sought his advice about opening an office in Dubai, he said.
“We won’t be the only ones,” Shtilman said. “In 12 months time, you’ll see quite a lot of Israeli companies opening there.”
The shift would dovetail with a charm offensive by the United Arab Emirates, of which Dubai is a part, to attract employees from all over the world by offering a new remote work visa and long-term residency to talented coders.
A landmark deal last year to establish diplomatic ties with the UAE means Israel’s companies can dangle the extra perk of relocating to Dubai.
Tech entrepreneurs have lobbied the Israeli government in the past to create a visa program for non-Jewish workers to alleviate the staffing crunch of about 13,000 job openings in the industry, according to the most recent data from the Israel Innovation Authority.
In response to the labor shortages Israel suffered during the pandemic, the country may allow high-tech companies to bring in some foreign workers, Finance Minister Avigdor Lieberman said on Monday in televised remarks. Speaking to his party’s legislators, Lieberman described the plan as a “kind of experiment” and gave no timeline or any other details.
Up until now, similar efforts have stalled, with some in Israel concerned such measures would dilute the country’s Jewish majority.
“Getting a hundred people from all over the world to work in Israel is a mission impossible,” said Shtilman, who is currently seeking to fill about 350 positions. By contrast, the process with the regulators in Dubai was “very smooth, very clear, like slicing butter,” he said.
Similarly to most high-flying startups, Rapyd is seeking innovative ways to attract highly skilled workers and maintain its breakneck pace of growth. The fight for talent in Israel rages as startups have raised $25.4 billion this year.
“One of the main reasons companies raise more money is to hire more people,” said Matan Bar, chief executive officer of Melio, an Israeli payments startup that tripled its valuation to $4 billion this year. For “companies that have higher aspirations and bigger plans — it all relies on getting bigger teams.”
As well as Rapyd’s base for expansion in the Middle East and North Africa, the Dubai office will also house engineers to help build the company’s offerings, Shtilman said. It landed on the idea after experiments with remote engineering hubs in Asia failed, he said.
Other startups could follow suit given the absence of a foreign visa plan, said Bar, who is looking to more than double headcount to 1,000 workers.
Bar said he has had “initial engagement” with Israeli officials about ways to let in more tech workers, and Melio prefers to have as many employees as possible in its Tel Aviv headquarters because that drives creativity and efficiency.
But “if that’s not possible, then we’ll do what everyone else is doing in order to meet the demand for people,” he said.
How To Get The Hottest Crypto Jobs: Start By Working With A DAO
Decentralized autonomous organizations are turning into training grounds — and poaching arenas — for talent as job seekers turn away from conventional finance.
Savvy undergraduates know the path to a career on Wall Street: Lock down summer internships by sophomore year — maybe junior at the latest — for a top firm to even consider an offer after graduation.
Then contend with years of long nights, countless PowerPoint presentations, Excel jockeying and junior vice presidents with a tendency to say things like, “Don’t think, just do.”
Crypto is turning that track askew. The space is luring away strivers from conventional finance — and successful candidates need to play by an entirely different rulebook.
Here, it’s not about the right contacts, a polished resume, a standout LinkedIn profile or even a portfolio of work. What can count even more in the eyes of a hiring manager are projects that are run by an online community and can usually be done from anywhere with an internet connection: Working for a DAO.
DAO stands for “decentralized autonomous organization.” It calls to mind the Dao of the ancient Chinese religion organized around it, in which it means “the path.” The Dao is the source of all things. Living in harmony with it leads to happiness and success. For now, at least, the story is similar with DAOs in the crypto job market.
“I would describe it as akin to an internship — maybe instead of a summer internship you’re working for a DAO,” said Tyler Wellener, a partner at BlockVenture Coalition, which helps college students land jobs at crypto firms. The group — which has worked with clubs at Carnegie Mellon, MIT, Berkeley and the University of Michigan — also is using a DAO called API3 to give students crypto work experience before graduating.
A DAO essentially works as a governance and crowdfunding entity over a blockchain. They’re designed not to have traditional hierarchies, and operate as if a shareholder board were to meet Reddit.
Aspiring workers might claim “bounties” to complete ad hoc tasks ranging from coding to marketing, or pitch their own ideas that are then voted on by thousands of members of an online community. There is a price to entry: DAOs often require voters to buy tokens — effectively cryptocurrencies for the organization.
Theoretically, anyone who wants to work on a project can volunteer. DAO workers say it’s reputation and proof of past work that get you picked for projects and then paid. Compensation typically happens using some mix of the DAO’s token and cash.
They are “very meritocratic, and there’s not a crazy job application,” said Dan Hepworth, a 21-year-old recent grad who works with friends on a DAO. “Too many people go into finance and banking and aren’t really adding value, when you can add value by creating something new.”
Hepworth’s resume includes everything a Wall Street firm would look for in a candidate: Duke University degrees in computer science and finance, a summer banking internship, an analyst role in a student investment society, even stints as a delivery person for DoorDash and Postmates. He’s also an Eagle Scout.
But instead of heading to a big bank, Hepworth took a job at a software company, where he describes his role as “building cool crypto stuff.” His side gig with the DAO involves creating smart contracts — programs stored on the blockchain — and testing them.
He’s paid in crypto but views the labor as a way to hone his skills, and perhaps more importantly, boost his credentials for his broader career.
The potential for job growth is huge. The number of crypto jobs increased 395% between 2020 and 2021, according to data from LinkedIn. While the share is still small relative to total finance and tech positions, those industries had a slower pace of growth, at 100% and 98%, respectively.
Crypto jobs may not immediately come with the financial rewards of banking, especially as large Wall Street firms jockey for junior talent and boost compensation for young staff. DAO workers are often paid in less well-known tokens tied to their projects, and such payments can be highly volatile.
At the same time, the crypto world is filled with overnight millionaires, and although many coins are down this year, Bitcoin is still up more than 450% since the beginning of 2020.
Part of the appeal of DAOs is the simplicity. “You only really need a connection to the internet and an ability to connect to the blockchain to participate and make money,” said Ali Yahya, general partner at Andreessen Horowitz and an expert in DAOs.
Jacob Blish, who leads business development at a DAO called Lido, worked at JPMorgan Chase & Co. for two years before being lured into the crypto fray. He was the first full-time worker for Lido and is now trying to expand the team.
“For the people I’m hiring, I don’t really care about their background,” he said. “The industry is growing so fast, I need people who are fast learners. If you’re 42 or 22 and you went to Harvard or didn’t go to college at all, it doesn’t matter.”
There are risks for making the leap into a nascent and entirely unregulated space. A DAO could run out of funding and then leave members without any income. The value of the token in the project could fall to zero. And taxes complicate compensation in cryptocurrency.
Arden Goldstein faced something of a learning curve in her role as head of marketing at Dash Core Group, an organization funded by the Dash DAO. Her boss is the company’s chief executive, Ryan Taylor. But she also answers to members of the DAO.
“Ryan’s my boss, but then there’s thousands of other people who are intimately concerned about how I spend my time each day and you know, and what my salary is,” she said.
Sometimes hearing scores of different ideas for her marketing projects can be challenging, particularly when a decision needs to be made. Still, she says, “the best ideas come from when there’s a lot of people with their opinions and you can kind of glean what’s best from them.”
Some people can use DAOs as an opportunity to completely change directions professionally. Chris Cameron, 37, spent most of his career working as an archaeologist, helping companies ensure they weren’t building on protected grounds.
Curiosity led him last year to MakerDAO, one of the largest, which focuses on decentralized finance. Before long, Cameron says he was conducting outreach events for Maker with policymakers and academics, explaining the project to figures such as a St. Louis Fed official and a congressman on the House Financial Services Committee. That ultimately led him to a full-time job as a government liaison with crypto firm GFX Labs.
He says he wouldn’t have got the job without the skills — and reputation — he developed on the DAO.
“Literally anybody can walk in — nobody checks for your credentials or anything” he said. “You kind of prove it, prove yourself by doing.”
Visa Seeks New College Grads For Crypto Development Program
Successful candidates will, among many other tasks, “define Visa’s crypto strategy and identify new product opportunities.”
According to a recent job posting, Visa is inviting new college graduates to join its 18-month rotational Crypto Development Program.
Applicants will alternate between the three departments of Visa’s current crypto ecosystem: crypto product, crypto solutions and digital partnership, where they are given training, development, mentoring, networking and leadership exposure on top of practical experience in the industry.
The job listing does not require any specific majors, although those studying the liberal arts, business, computer science and related fields are preferred. In addition, only applicants who graduated or will graduate from a baccalaureate program between December 2021 and August 2022 qualify.
Notable duties include building subject matter expertise in specific areas of crypto, learning how to build new products inside of Visa, discovering how crypto companies operate, supporting product partnerships and learning about new crypto business models.
Over the past year, Visa has been making small but incremental moves into the crypto space, such as announcing a new crypto consulting service for merchants and banks, working on blockchain interoperability hub for crypto payments, and partnering with crypto enterprise payment platforms to expand credit options for businesses.
Each year, the payment solutions provider facilitates 215 billion transactions between consumers, merchants, financial institutions and government entities across more than 200 countries.
In July 2021, Visa representatives also spoke about the company’s perception of stablecoins, saying:
“Stablecoins are on track to become an important part of the broader digital transformation of financial services, and Visa is excited to help shape and support that development,”
Brazilian Crypto Unicorn 2TM Lays Off Over 80 Employees
The company cited “the changing global financial landscape.” Its main competitor in Latin America, Bitso, laid off a similar number of people last week.
2TM, the holding company for Mercado Bitcoin, Brazil’s largest crypto exchange by market valuation, laid off over 80 employees on Wednesday.
“The changing global financial landscape, rising interest rates and inflation have been having a major impact on technology-based companies,” 2TM said in a statement. It did not mention an exact number of layoffs, although it did publish a list with 86 profiles of fired employees, along with their contacts.
The company also said that “the scenario required adjustments that go beyond reducing operational expenses, making it necessary also to lay off part of our employees.”
According to its LinkedIn page, Mercado Bitcoin Market has more than 580 employees, while 2TM has more than 80.
2TM’s announcement comes a week after Latin American crypto exchange Bitso, Mercado Bitcoin’s main competitor in Brazil, laid off 80 employees citing “long-term business strategy” as the reason.
Also last week, the Argentina-based cryptocurrency exchange Buenbit laid off 45% of its staff – 80 employees, approximately – due to the “global overhaul” of the tech industry, the company said.
2TM became the second crypto unicorn in Latin America after raising a total of $250 million in 2021 at a $2.2 billion valuation.
In January, it acquired a controlling stake in CriptoLoja, Portugal’s first regulated crypto exchange, while it planned to enter the Spanish-speaking part of Latin America through acquisitions in Argentina, Chile, Colombia and Mexico, 2TM CEO Roberto Dagnoni told CoinDesk in June 2021.
In March, Mercado Bitcoin was in talks to be acquired by crypto exchange Coinbase Global (COIN), but negotiations failed, Bloomberg reported in May.
Major Crypto Firms Reportedly Cut Up To 10% Of Staff Amid Bear Market
Previous crypto bear markets triggered much bigger layoffs, with some firms like ConsenSys reportedly firing up to 60% of its workforce in 2018.
Gemini, a cryptocurrency trading platform founded by brothers Cameron and Tyler Winklevoss, is the latest industry firm to lay off a significant part of its staff due to unfavorable market conditions.
Winklevoss’ crypto business Gemini Trust reportedly cut 10% of its employees amid the ongoing bear crypto market, the founders wrote in a notice to employees on June 2, as Bloomberg reported.
As part of its first major headcount cut, Gemini will refocus on products that are “critical” to the firm’s mission, the brothers said, adding that “turbulent market conditions” are “likely to persist for some time.” The notice reportedly reads:
“This is where we are now, in the contraction phase that is settling into a period of stasis — what our industry refers to as “crypto winter. […] This has all been further compounded by the current macroeconomic and geopolitical turmoil. We are not alone.”
The new report comes after a number of major industry companies fired some employees or put new hires on hold. In late May, the major Latin American crypto exchange Bitso laid off 80 employees, citing internal issues.
“We found that the state of our organization was not representing our business and go-to-market strategy to the best of Bitso’s ability, which led to our internal restructuring,” a spokesperson for Bitso told Cointelegraph.
Previously, the Coinbase exchange officially announced in mid-May that it would slow down hiring and reassess its headcount in order to ensure it continues operating as planned. The major crypto-friendly trading platform Robinhood also fired 9% of its workforce in April.
The layoffs came amid Robinhood’s HOOD stock touching all-time lows as part of a longer-term bear market on crypto markets.
The latest crypto industry layoffs are by no means new to the industry as major crypto markets like Bitcoin (BTC) have been historically moving in cycles, with major bear markets preceding bigger gains.
Amid a massive bear market of crypto in 2018, some industry firms like ConsenSys reportedly fired up to 60% of their workforce, announcing plans to hire 600 employees afterward.
According to some sources, the current conditions of the crypto job market do not look too gloomy though. A spokesperson for the FTX crypto exchange told Cointelegraph that the firm has not cut and does not plan to lay off any of its current 175 employees at the global exchange or 75 employees at the FTX US.
Per crypto hiring website by the Bitcoin influencer Anthony Pompliano, executives in the crypto and blockchain industry are still looking to hire people, with the PompCryptoJobs website listing about 600 open positions at the time of writing.
The major global crypto exchange Binance is looking to hire nearly 1,000 employees, according to its official job openings website.
Gemini did not immediately respond to Cointelegraph’s request for comment.
Softbank-Backed 2TM Cuts About 90 Jobs As Crypto Winter Lingers
* Layoff Hits More Than 10% Of Mercado Bitcoin Owner’s Staff
* Brazilian Company Says Decision Prompted By Economic Climate
2TM Participacoes SA, the holding company that owns Brazil’s Mercado Bitcoin SA, has dismissed about 90 employees, more than 10% of its workforce, according to people familiar with the matter, who asked not to be named because the number isn’t public.
In a statement, which did not include the exact number of people affected, 2TM said the measure was necessary because of the macroeconomic climate. The statement cited rising interest rates, inflation, and current global financial conditions. O Estado de S. Paulo, a Brazilian newspaper, first reported 2TM’s layoffs.
2TM raised $50 million in November from investors including Tribe Capital and 10T Holdings. Earlier this year, the company had been linked to a potential deal with Coinbase Global Inc. that could have resulted in a controlling acquisition or a minority stake sale. The talks ended in early May.
Coinbase, which has faced its own financial challenges, said on Thursday that it would extend a hiring freeze and rescind certain job offers. That announcement followed a similar move from Gemini, which said it would slash 10% of its workforce, and cuts at Bahrain-based Rain Financial.
2TM is at least the second Softbank-backed crypto firm that has cut its workforce in Latin America to reduce costs in recent weeks, as the ongoing “crypto winter” has seen tokens like Bitcoin and Ether fall significantly from their record highs.
At the end of May, Mexico-based crypto exchange Bitso told CoinDesk it had cut 80 employees out of a workforce of more than 700 people.
Spotify To Slow Hiring Plans, Cites Economic Uncertainty
* Audio Service Will Cut Hiring Growth By About 25%, CEO Says
* Company Says It Will Still Add To Its Staff This Year
Spotify Technology SA will slow hiring growth by 25%, the latest sign of how fears of a recession are weighing on the economy.
The world’s largest on-demand audio service has been on a hiring spree for years, adding more than 2,000 employees between 2019 and 2021 for a total of 6,617 at the end of last year. The company will continue to add headcount in the coming months, but it will adjust its plans in light of macroeconomic factors, Chief Executive Officer Daniel Ek said in a note to staff Wednesday.
Spotify suggested it would adjust its staffing at a presentation to investors last week. “While we have yet to see any material impact to our business — we are keeping a close eye on the situation and evaluating our headcount growth in the near term,” Chief Financial Officer Paul Vogel said at the time.
Inflation and rising interest rates have led to rising worries in the corporate world of an economic slowdown. The S&P 500 is down more than 20% this year, and technology stocks like Spotify have been hit particularly hard. Shares in the company have declined more than 50% so far this year.
More Companies Start To Rescind Job Offers
The labor market remains hot. Yet businesses in a range of industries are pulling back job offers to recruits they were courting just a short time ago.
Businesses in several different industries are rescinding job offers they made just a few months ago, in a sign the tightest labor market in decades may be showing cracks.
Companies including Twitter Inc. , real-estate brokerage Redfin Corp. , and cryptocurrency exchange Coinbase Global Inc. have rescinded offers in recent weeks.
Employers in other pockets of the economy are pulling away offers too, including some in insurance, retail marketing, consulting and recruiting services.
At the same time, many companies have signaled a more cautious hiring approach. Netflix Inc. , Peloton Interactive Inc. , Carvana Co. and others announced layoffs.
Technology giants such as Facebook parent Meta Platforms Inc. and Uber Technologies warned they will dial back hiring plans.
The labor market remains strong overall, with an unemployment rate at 3.6%, near the half-century low it reached in early 2020.
But these signs of caution in hiring show that executives are finding it tougher to predict the next 12 months in the economy, say hiring managers and recruiters.
When a company revokes a job offer, it indicates a company’s business outlook has changed so quickly it has to undo hiring plans made sometimes weeks before.
“I just couldn’t believe what I was hearing—like it’s a job I had had lined up for months and I really was counting on it,” said Franco Salinas, 24 years old, who learned this month that a data-analyst position he planned to start in July had been axed. “This just made me realize how fragile things are.”
Some recruiters caution that there hasn’t been a large wave of job offers canceled. At the same time, employers still can’t find enough workers for many types of jobs.
Yet, “going from zero to a fairly small amount seems like a big increase,” said Brian Kropp, vice president of human-resources research for advisory firm Gartner.
He said having a job offer rescinded was almost unheard of six months ago. “If we’ve learned anything from the last couple of years, it’s that things can change quickly,” he said.
Mr. Salinas is one of many recent college graduates who locked in a job while he wrapped his studies. Information-technology consulting firm Turnberry Solutions in October offered him a data-analyst job based in Minneapolis.
An international student from Peru, he said he had passed on other offers to accept Turnberry’s. Having landed the employer-sponsored visa required to remain in the country, he felt secure in signing a lease and making other plans.
The firm called to rescind the offer this month. A Turnberry spokeswoman confirmed two offers for data analysts had been rescinded, though the company says it is still hiring for other skill sets.
“We do not take the decision to rescind offers lightly,” the spokeswoman said, adding that the firm had paid the two consultants two months’ rent to help compensate. “We periodically need to adjust the skills we bring in given changes in demand from our clients.”
Other companies attribute canceled job offers to the knock-on effects of a tech-industry slowdown—including the firm that made Jenna Radwan an offer in May. It rescinded the offer two weeks before her June start date.
Hirect, a chat-based app focused on tech recruiting, had wowed the 21-year-old with a starting salary of $80,000, plus the promise of a minimum uncapped commission of $195,000 and the flexibility to set her own schedule.
Ms. Radwan felt confident enough to turn down three other jobs and withdraw from three additional interview processes, she said.
“They gave me a strict deadline, so I was like, ‘I’m just going to go ahead and take this and go with my gut,’” she said.
As she prepped to start, the recruiter sent her an email: Hirect was pulling the offer and freezing hiring because of drastic and unforeseen changes in market conditions.
“We haven’t been immune to these recent challenges, nor the considerable belt-tightening going on throughout our industry,” a Hirect spokesman said of a recent slump in tech hiring that led the company to rescind two job offers.
Ms. Radwan is proceeding more carefully in her renewed hunt for a marketing, sales or account-management job. She plans to complete every hiring process before accepting any offer, even if it means asking for more time to decide, she said.
“I didn’t even know that this type of thing could even happen,” she said.
Other jilted job seekers say they are tackling their new searches differently, too. Raleigh Burke accepted a claims-analyst job at a Los Angeles-based insurance brokerage in May, gave notice at her old job the same day, then jetted to Hawaii for some rest.
By the time she got home, her offer had evaporated without an explanation. She was surprised, she said, because she had been told she was the top candidate.
Ms. Burke, 35, had turned down an offer with another company to accept this one. “So what do I do, go with my tail between my legs and crawling back?” she said.
Next time she pursues a job switch, she said she might not resign until she receives a laptop from the new company or starts its onboarding process.
For now, many hiring managers say signing up new recruits remains highly competitive. A Gartner survey of more than 350 HR executives conducted at the end of May found around 50% thought the competition for talent would increase over the next six months. Nearly two-thirds said they hadn’t made any changes to their hiring practices or HR budgets in response to economic volatility.
While startups, companies in the ad-tech industry, and those that are pre-IPO might be less stable right now, it’s still a job candidate’s market, said Keith Feinberg, senior vice president with professional staffing firm Robert Half.
Still, he said he wouldn’t be surprised if job seekers evaluate some opportunities more cautiously than a few months ago.
Steven Pope, 32, was supposed to start a new job as a director of data for a retail marketing firm after Memorial Day weekend.
Instead, he’s job hunting again after his start date was put on hold indefinitely. The company told him an expected round of funding had been delayed, he said.
Mr. Pope is now taking as many interviews as he can get, he said. He’s also rethinking the types of opportunities he’s willing to consider.
“I’m looking at how are these companies backed up or paid,” he says, adding that his friends in tech are starting to prioritize differently in their own searches. “I see there’s a little bit of a shift already where security is going to come before comp.”
Tesla Job Cuts Include Workers Who Joined The Company Weeks Earlier
Elon Musk’s abrupt dismissals suggest a strong run of execution has come to an end.
Tesla has outperformed established automakers the last several years, expanding production and deliveries at a blistering pace as much of the rest of the industry struggled with lockdowns and supply shortages.
The mass firing now being carried out at the behest of Elon Musk suggests this strong run of execution has come to an end, and could complicate efforts to get back on track.
We’ll find out roughly a week from now how many electric vehicles Tesla built and handed over to customers this quarter.
There was little the company could do, of course, about Shanghai shutting down the city for weeks and costing the carmaker output from its most productive plant. Musk’s words and actions lately don’t inspire much confidence in how the company has coped.
First, the chief executive officer gave an interview to the Tesla Owners of Silicon Valley on May 31 (though the fan club only just aired the footage this week).
Musk described the new factories opened recently near Berlin and in Austin, Texas, as “gigantic money furnaces” losing billions of dollars.
Days later, Reuters reported Musk had sent an email to Tesla executives saying he wanted to dismiss 10% of employees. He then wrote in an all-staff email that cut would only apply to salaried workers. Then he tweeted Tesla’s overall headcount will increase over the next year.
Finally, Musk told Bloomberg News Editor-in-Chief John Micklethwait this week that the salaried job cuts would take place over roughly three months.
He also downplayed the significance of a lawsuit by former employees who claim Tesla violated federal law by failing to provide advance notice of the job cuts, calling it “ trivial.”
Some already affected have taken to LinkedIn to share that they were let go after having been brought on very recently. A recruiter who had been with Tesla just two weeks deemed his dismissal a gut punch.
A former intern wrote that the carmaker rescinded a full-time offer he’d accepted over another job opportunity. In seeming contradiction to Musk’s company-wide memo, some hourly workers also have been shown the door.
This is all reminiscent of the days when Tesla was hiring rapidly around the start of Model 3 production, only to announce it would fire 9% of employees in June 2018, followed by a 7% reduction in January 2019.
When Musk communicated yet another round of cuts the following month and a plan to close many of Tesla’s stores, then called off the retail strategy change in a matter of weeks, one analyst described the episode as “amateur hour.”
Tesla eventually navigated its way out of that mess and may well bounce back again. But the clumsy way Musk handled this latest round of layoffs will have ripple effects: on the lives of employees let go and those who remain.
Job cuts are always a horrible process, but steps could have been taken in this case to make it less painful for all involved.
Microsoft Cuts Jobs In Structural Adjustment, Plans More Hiring
Software maker intends to grow headcount in the current fiscal year.
Microsoft Corp. cut some jobs on Monday as it realigned business groups and roles after the close of its fiscal year on June 30. It said it plans to keep hiring for other roles and finish the current fiscal year with increased headcount.
The layoffs, affecting less than 1% of the 180,000-person workforce, spanned a variety of groups including consulting and customer and partner solutions and were dispersed across geographies, the Redmond, Washington-based company said.
“Today we had a small number of role eliminations. Like all companies, we evaluate our business priorities on a regular basis, and make structural adjustments accordingly,” Microsoft said in an emailed statement. “We will continue to invest in our business and grow headcount overall in the year ahead.”
In recent years, Microsoft has typically announced job cuts shortly after the July 4 holiday in the US as it makes changes for the new fiscal period. The company said the layoffs were not spurred by the worsening economic picture, but in May it also slowed hiring in the Windows and Office groups.
Google To Slow Hiring For Rest Of Year, Alphabet CEO Says
* Tech Giant Will Focus Hiring On Technical Roles In 2022, 2023
* CEO Pichai Calls On Company To Be “More Entrepreneurial”
Alphabet Inc.’s Google plans to slow hiring for the remainder of the year in the face of a potential economic recession, Chief Executive Officer Sundar Pichai said Tuesday in an email to staff.
Pichai said the company will focus on hiring “engineering, technical and other critical roles,” in 2022 and 2023, according to a copy of the email viewed by Bloomberg News.
“Moving forward, we need to be more entrepreneurial, working with greater urgency, sharper focus, and more hunger than we’ve shown on sunnier days,” Pichai wrote. “In some cases, that means consolidating where investments overlap and streamlining processes.”
Historically, Google has remained relatively immune to the economic dips of the technology sector. The internet giant paused hiring after the financial crisis more than a decade ago, but has since regularly added waves of new employees for its main advertising business as well as areas such as smartphones, self-driving cars and wearable devices that aren’t yet profitable.
Google parent Alphabet, which employed almost 164,000 people as of March 31, has hired primarily in recent years for Google’s cloud division and new fields like hardware.
Google’s move mirrors that of other tech companies. In May, Snap Inc. and Lyft Inc. said they would slow hiring. Several weeks later, Instacart Inc. said it would dial back job growth and Tesla Inc. followed with an announcement of a 10% reduction for its salaried workforce.
Earlier this week, Google rival Microsoft Corp. announced it was cutting a small number of jobs. Meta Platforms Inc. also reduced its hiring plans because of concerns over economic conditions.
In the email, Pichai said Google added 10,000 staffers during the second quarter and had “strong commitments” in the next few months to hire college recruits. Business Insider reported earlier on Google’s plans.
Earlier this week, Google rival Microsoft Corp. announced it was cutting a small number of jobs. Meta Platforms Inc. also reduced its hiring plans because of concerns over economic conditions.
Here’s The Email:
Hard to believe we’re already through the first half of 2022. It’s the right opportunity to thank everyone for the great work so far this year, and to share how my Leads and I are thinking about H2.
The uncertain global economic outlook has been top of mind. Like all companies, we’re not immune to economic headwinds. Something I cherish about our culture is that we’ve never viewed these types of challenges as obstacles.
Instead, we’ve seen them as opportunities to deepen our focus and invest for the long term.
In these moments, I turn to our mission: to organize the world’s information and make it universally accessible and useful. It’s what inspired me to join the company 18 years ago, and what makes me so optimistic about the impact we are able to have on the world. Knowledge and computing are how we drive our mission forward.
That’s the lens we use to decide where to invest — whether it’s in areas like Search, Cloud, YouTube, Platforms and Hardware, the teams that support them, or in the AI that enables more helpful products and services.
We help people and society when we focus on what we do best, and do it really well. The investments we’ve made in the first half of the year reflect this vision.
In Q2 alone, we added approximately 10,000 Googlers, and have a strong number of commitments for Q3 start dates which reflects, in part, the seasonal college recruiting calendar. These are extraordinary numbers, and they show our excitement about long-term opportunities, even in uncertain times.
Because of the hiring progress achieved so far this year, we’ll be slowing the pace of hiring for the rest of the year, while still supporting our most important opportunities.
For the balance of 2022 and 2023, we’ll focus our hiring on engineering, technical and other critical roles, and make sure the great talent we do hire is aligned with our long-term priorities.
Moving forward, we need to be more entrepreneurial, working with greater urgency, sharper focus, and more hunger than we’ve shown on sunnier days. In some cases, that means consolidating where investments overlap and streamlining processes.
In other cases, that means pausing development and re-deploying resources to higher priority areas. Making the company more efficient is up to all of us — we’ll be creating more ways for you all to engage and share ideas to help, so stay tuned.
Scarcity breeds clarity — this is something we have been saying since the earliest days of Google. It’s what drives focus and creativity that ultimately leads to better products that help people all over the world. That’s the opportunity in front of us today, and I’m excited for us to rise to the moment again.
Microsoft And Gopuff Are Latest Tech Firms To Cut Jobs
Companies have been adjusting hiring plans amid growing economic concerns.
Microsoft Corp. is cutting a small percentage of its staff, the latest in a string of layoffs by high-profile tech companies.
The software maker said it is cutting a number of positions, affecting less than 1% of its total workforce. Microsoft, which employed about 181,000 people as of June 2021, is making the cuts as a part of a regular adjustment at the start of its fiscal year, a spokesman said. The company’s overall workforce will still rise in the coming year, he said. Bloomberg earlier reported the cuts.
Rapid-delivery startup Gopuff told its investors in a note Tuesday that it is cutting 10% of its workforce, or about 1,500 employees amid growing concerns about the economy.
The tech industry has been hiring at a rapid pace for years, but the easy money that fueled years of highflying startups is drying up. The reversal of some pandemic trends, combined with inflation, supply-chain shortages and a labor crunch, is cooling parts of the once red-hot tech sector.
A number of tech companies in recent months have laid off employees to deal with slowing growth and fallout from other macroeconomic factors.
Meta Platforms Inc.’s head of engineering told his managers to identify and report low performers so they could force those employees out of the company, according to a post published Friday in an engineering managers-only group in the company’s internal social network.
That followed Twitter Inc. last week saying it would lay off 30% of its talent acquisition team. Tesla Inc. late last month laid off about 200 people and Netflix Inc. cut about 3% of its workforce as it deals with a loss in subscribers.
Amazon.com Inc. has also looked to pare hiring in some areas. Videogame companies including Unity Software Inc. and GameStop Corp. have recently shed staff while Uber Technologies Inc. and Lyft Inc. have paused some hiring.
In some cases, executives have warned employees to brace themselves for tougher times. Jobs in computer and electronic products grew by 2,300 from May, for example, down from an average of more than 2,800 in the prior five months of this year.
Microsoft’s move follows some challenges for the company. The company in June reduced sales and earnings guidance for the quarter, citing the impact of foreign exchange rates.
The company could also be affected by a drop in demand for personal computers. Shipments in the second quarter dropped by close to 13% from the year-ago period, marking their steepest decline in nine years, according to data from research firm Gartner Inc.
Philadelphia-based Gopuff announced its layoff plans in a Tuesday note to investors, reviewed by The Wall Street Journal. It also said it plans to shut 76 of its warehouses, covering roughly 12% of its network. The company cut 3% of its workforce in March.
The note from Gopuff said the additional cuts are an attempt to get ready for tougher times “as we prepare for what could be a much more significant macroeconomic downturn than we are experiencing currently.”
The company said it would make investments that drive more profit, including technology to run ads on its app, and continue to focus on overseas markets such as the U.K. that are leading revenue growth.
Gopuff said it hopes to become profitable in 2024 on the back of these changes.
Gopuff, founded in 2013, leads the instant-delivery market in the U.S.
Investors raced to pour money into fast-delivery startups during the pandemic as customers grew accustomed to ordering household essentials online. Many startups that promised delivery in under 15 minutes piled up fast losses and some folded within a year.
Job Offer Rescinded? What To Do If You Had Already Given Notice
Welcome back to the job search you thought you had finished.
It’s not a situation anyone wants to face: After sending out resumes, enduring multiple interviews and going through the agony of negotiation, you’ve landed a fantastic new job … only to have the offer rescinded. Although rare, some job offers are being withdrawn in this bad-vibes economy. What’s a jilted job hunter to do?
First — and this advice works for all sorts of situations — don’t slam anyone on Twitter. Limit venting to close friends and family. “When we get the bad news, every molecule of fear, anger and helplessness rushes in,” says executive coach Liz Kislik.
“Sometimes we can say things that are not useful to our future selves.” Instead, look for ways to express disappointment without burning the bridge.
“It doesn’t hurt to tell them, ‘I am crushed that I will not be able to join your company and I hope that when your circumstances change we will have another opportunity to work together.’”
A lot of people will tell you that it’s a blessing in disguise that your offer has been rescinded, because it probably means you’re dodging a troubled company. But if it’s your dream job, it’s worth hoping that the company will get its act together and change their mind (again).
Nathan Furr, a strategy professor at Insead, told me his path to a faculty position at the prestigious France-and-Singapore-based business school was full of U-turns.
The school seemed to be on the cusp of formalizing an offer, then said they didn’t want to hire him after all, and then — nine months later — came back with an offer.
So if the job that evaporated is one you really want, don’t give up on it, said Susannah Harmon Furr, an entrepreneur and Nathan’s spouse and co-author on “The Upside of Uncertainty: A Guide to Finding Possibility in the Unknown.”
If you’ve already given notice at your current job, consider trying to un-resign. “If you still have a fantastic relationship with your old boss, get on the horn,” says Kislik. “Say, ‘If my old job is available, I would like to come back, and I would like to talk to you about how we can make it a better situation on both sides.’”
Acknowledge the social awkwardness of the situation, and admit that your about-face has been disruptive. That could help assuage the fears of an employer who now has extremely good reason to see you as a flight risk.
Let other places you interviewed know you’re back on the market. There is an old-fashioned idea that companies will be too put off by a candidate who withdrew to give them another chance.
But Laura Mazzullo, founder and owner of New York-based recruiting firm East Side Staffing, says the power dynamic between employees and employers is now more balanced. “The rule book of 10 years ago, five years ago, really isn’t relevant right now,” she says.
If returning to a previous job isn’t possible and other opportunities have dried up, come up with a short-term plan to manage your cash flow. For about 40% of all job seekers, it takes six months to find a new job, and the Federal Reserve estimates that only one in four US households has emergency savings that would last that long. 1
If yours is among them, perhaps you can reframe this unwanted employment break as a spontaneous sabbatical. Have you always wanted to apply for a fellowship, take a class or volunteer abroad? Maybe this is your chance.
But be intentional about how you use this windfall of time. A 2015 study showed that unemployed men tend to spend most of their waking hours watching TV, and unemployed women spend a ton of time on housework.
You probably don’t want to look back on this period to find you spent it vacuuming. Besides, having “extracurriculars” will make you more attractive to a potential employer.
The Furrs cautioned against taking a job, any job, just to end the uncertainty. Kislik, too, warned that taking a pay-the-bills gig can drain some of the energy needed for a job search.
Perhaps a better short-term answer is part-time consulting work or freelancing; the company that withdrew your offer might even have some leads. Seems like the least they could do.
Realistically, with even some high-earning Americans living paycheck-to-paycheck and full-time employment still an essential source of health insurance, you might have to take a job you aren’t that thrilled about while you keep looking for something better.
It used to be considered a professional sin to stay less than a year — but that’s one of those outmoded rules that serves employers more than employees. As long as you leave gracefully, the short tenure won’t haunt you.
In all sorts of ways, work has become more fluid and less rigid than it was in previous decades — for better and for worse. We dress more casually, boomerang back to former employers and blur the line between business and pleasure travel (giving us hideous portmanteaux like “workation” and “bleisure”). Employers ghost applicants, and applicants ghost would-be employers.
Nine-to-five is now “always on.” And formal, written offers don’t mean what they used to, either for new hires — who sometimes back out after signing — or for employers.
Of course, employers shouldn’t rescind job offers — it’s not fair to the candidate and it reflects poorly on the company. “This is a horrendous thing to do for their brand,” says Mazzullo. Nonetheless, there is only so much a person can do to prevent it.
One way to protect yourself might be to ask for a sign-on bonus; that way, if the offer evaporates, you’ll have a cash cushion to fund your search for a new one. Ideally, one that sticks.
Apple To Slow Hiring And Spending For Some Teams Next Year
* Company Won’t Backfill Roles Or Add New Staff In Certain Cases
* Apple’s Tech Rivals Take Similar Steps As Recession Looms
Apple Inc. plans to slow hiring and spending growth next year in some divisions to cope with a potential economic downturn, according to people with knowledge of the matter.
The decision stems from a move to be more careful during uncertain times, though it isn’t a companywide policy, said the people, who asked not to be identified because the deliberations are private.
The changes won’t affect all teams, and Apple is still planning an aggressive product launch schedule in 2023 that includes a mixed-reality headset, its first major new category since 2015.
Still, the more cautious tone is notable for Apple, a company that has generally beat Wall Street predictions during the Covid-19 pandemic and has weathered past economic turmoil better than many peers.
Apple shares fell 2.1% to $147.07 after Bloomberg reported on the slowdown, marking the biggest one-day decline in almost three weeks. The stock has slipped about 17% so far this year, on par with the broader market. Shares of other tech companies also declined on the news Monday.
Alphabet Inc., Amazon.com Inc., Meta Platforms Inc., Snap Inc. and other tech companies have taken their own steps in recent weeks to rein in budgets and decelerate hiring. Microsoft Corp., Tesla Inc. and Meta have gone as far as to cut jobs — something Apple hasn’t historically done.
Apple, based in Cupertino, California, allocates a certain amount of money to each major division annually for spending on research and development, resources and hiring. For 2023, it’s giving select teams a lower-than-expected budget.
For some groups, the company won’t increase headcount in 2023, whereas it might normally hire 5% to 10% more employees in a given year. It also plans to not fill roles of departing employees for some groups.
A spokesperson for the technology giant declined to comment.
Over the last few years, Apple has invested heavily in research and development, hired aggressively from its competition and launched several new products.
But it’s also confronted supply-chain challenges, including the shutdown of production in China in recent months. Apple warned in April that the problems would cost it as much as $8 billion in the latest quarter.
Analysts expect Apple to report third-quarter revenue of about $83 billion, slightly above the year-earlier period, when it releases results on July 28.
During the last earnings call, Chief Executive Officer Tim Cook said Apple was “seeing inflation” and that the impact was evident in its gross margin and operating expenses. The company also cited a continued negative impact from Covid-19 and rising freight costs. It declined to provide specific revenue guidance.
While the spending slowdown is rare, Apple has taken similar steps before. In early 2019, before the pandemic, the company cut back on hiring after iPhone sales missed expectations in China and other parts of the world. In April, it also slowed hiring of some Apple retail store positions.
Even as it prepares to rein in spending in some areas, Apple plans to boost its companywide compensation budget this year to cope with a tighter labor market. The company also is contending with efforts to unionize its stores across the US.
Apple recently increased pay for many hourly retail and technical support workers, with employees saying the raises are coming in between 5% and 15%.
At the same time, Apple is preparing a flood of new products. Later this year, the company expects to introduce four iPhone models, three Apple Watch variations, new Mac desktops and laptops, and an updated Apple TV set-top box. It’s also planning a new HomePod speaker, a larger iPad and several new Macs for next year.
Apple dedicated about $22 billion to R&D in fiscal 2021, up 17% from the prior year. At the end of that year, the company had about 154,000 employees.
In 2021, Apple’s capital expenditures topped $11 billion, a 52% increase from 2020, while overall operating expenses — which includes marketing spending, payroll and equipment costs — rose 13% last year to about $44 billion.
The company has been spending billions of dollars annually on a troubled electric car effort, new content for its Apple TV+ streaming service and its mixed-reality headset. It’s also working on developing its own components, such as cellular modem chips, in addition to products like foldable devices and augmented reality glasses.
Goldman Sachs Plans To Slow Hiring, Bring Back Annual Performance Reviews
Goldman Sachs Group Inc. plans to slow hiring and reinstate annual performance reviews as the Wall Street bank looks to rein in expenses.
“Given the challenging operating environment, we are closely re-examining all of our forward spending and investment plans to ensure the best use of our resources,” Chief Financial Officer Denis Coleman said Monday on a conference call with analysts.
“We’re taking a number of actions to improve our operating efficiency. Specifically, we have made the decision to slow hiring velocity and reduce certain professional fees going forward.”
In addition, the New York-based firm could reduce the pace of replacing staff it loses because of attrition, Coleman said, adding that it plans to reinstate annual performance reviews at the end of the year, a practice it had suspended during the pandemic.
The reviews were typically used to weed out the worst-performing staff.
Total operating expenses declined in the second quarter from a year earlier as the firm cut compensation and benefits, but the company also reported increases in costs from growth initiatives.
Peloton, Calm And Linkedin Add To Growing List Of Tech Layoffs
After years of bulking up, the industry is bracing for recession.
Despite some promising economic signs recently, more tech companies are hitting the pause button on their hiring plans.
They’re instituting freezes, rescinding jobs offers and even resorting to layoffs (with one CEO showing his remorse by sobbing on social media).
According to Layoffs.fyi, a website tracking job cuts at startups and recently public companies, more than 37,000 positions were eliminated at 467 globally in the second quarter. That compares with fewer than 3,000 during the same time last year.
Here’s A Look At The Dozens Of Companies Tapping The Brakes:
Alphabet Inc., Google’s parent company, has been decelerating its recruiting efforts. Chief Executive Officer Sundar Pichai told employees in July that—although the business added 10,000 Googlers in the second quarter—it will be slowing the pace of hiring for the rest of the year and prioritizing engineering and technical talent.
“Like all companies, we’re not immune to economic headwinds,” he said. The hiring pause is part of that slowdown, Google said, “to enable teams to prioritize their roles and hiring plans for the rest of the year.” It had nearly 164,000 employees at the end of March.
Amazon.com Inc. said in April that it was overstaffed after ramping up during the pandemic and needed to cut back. “As the variant subsided in the second half of the quarter and employees returned from leave, we quickly transitioned from being understaffed to being overstaffed, resulting in lower productivity,” Chief Financial Officer Brian Olsavsky said at the time.
Amazon has been subleasing some warehouse space and paused development of facilities meant for office workers, saying it needed more time to figure out how much space employees will require for hybrid work. During its quarterly earnings call on July 28, the e-commerce giant said it’s been adding jobs at the slowest rate since 2019.
After relying on attrition to winnow its staff, Amazon has about 100,000 fewer employees than in the previous quarter. The company now has 1.52 million full- and part-time workers and is still the largest employer in the tech world, despite the reduction in headcount.
Amazon Package Deliveries On Prime Day
Apple Inc. is planning to slow hiring and spending at some divisions next year to cope with a potential economic slump, according to people familiar with the matter. But it’s not a companywide policy, and the iPhone maker is still moving forward with an aggressive product-release schedule. Apple had 154,000 employees in September, when its last fiscal year ended.
Calm, the meditation app, cut 20% of its 400 employees. The company, which was valued at $2 billion in 2020, has been the No. 1 stress-reduction app for at least the last three years through May, according to Data.ai, a mobile analytics firm.
The cuts were “especially difficult for a company like ours whose mission is focused on workplace mental health and wellness,” CEO David Ko said.
Carvana Co., an online used car retailer, laid off 2,500 people in May, about 12% of its workforce. In an unusual move, the executive team will forego salaries for the rest of the year to pay severance to those who were let go, according to a filing with the Securities and Exchange Commission. The company had more than 21,000 full-time and part-time employees at the end of last year.
Coinbase Global Inc., a cryptocurrency exchange, told employees it was cutting 18% of staff in June to prepare for an economic downturn. It also rescinded job offers.
“We appear to be entering a recession after a 10+ year economic boom,” CEO Brian Armstrong said in a blog post.
“While it’s hard to predict the economy or the markets, we always plan for the worst so we can operate the business through any environment,” he said. The company ended the quarter with about 5,000 employees.
Compass Inc., a real estate brokerage platform, is eliminating 450 positions, about 10% of its staff, according to a filing. The company had nearly 5,000 employees at the end of 2021.
Gemini Trust Co., a cryptocurrency exchange founded by Bitcoin billionaires Cameron and Tyler Winklevoss, announced a 10% staff reduction in June.
TechCrunch reported that the company laid off another 7% on July 18 and said a leaked plan showed it was seeking to cut a total of 15%, bringing it from 950 employees to 800 employees.
GoPuff, a grocery delivery app, is laying off 10% of its workforce and closing dozens of warehouses. The cuts will affect about 1,500 staff members—a mix of corporate and warehouse employees.
LinkedIn, which is owned by Microsoft, laid off its global events marketing team in August, as reported by Insider.
Lyft Inc. told employees it was reining in hiring in May after its stock dropped precipitously. The company went further on July 20, announcing plans to shutter its car-rental business and cut about 60 jobs. Lyft had about 4,500 employees in 2021.
Archrival Uber Technologies Inc., meanwhile, has been more upbeat. CEO Dara Khosrowshahi told Bloomberg in June that his company was “recession resistant” and had no plans for layoffs.
Meta Platforms Inc., the parent of Facebook, slashed plans to hire engineers by at least 30%. CEO Mark Zuckerberg told employees that he’s anticipating one of the worst downturns in recent history. The company had more than 77,800 employees at the end of March.
Microsoft Corp. told workers in May that it was slowing down hiring in the Windows, Office and Teams groups as it braces for economic volatility. The company had 181,000 employees in 2021. More recently, the software maker cut some jobs—less than 1% of its total—as part of a reorganization.
On July 20, the company said it began eliminating many job openings—a freeze that will last indefinitely. On Aug. 9, the company laid off a group focused on consumer R&D called “Modern Life Experiences.”
Netflix Inc., the streaming giant, has had several rounds of highly publicized layoffs since it reported the loss of 200,000 subscribers in the first quarter.
In April, it began scaling back some marketing initiatives, then cut 150 employees in May and 300 in June. Last quarter, it reported $70 million in expenses from severance and shed an additional 970,000 subscribers. Netflix had 11,300 employees in 2021.
Niantic Inc., maker of the Pokemon Go video game, fired 8% of its team in June. It was an effort to streamline operations and position the company to weather economic storms, CEO John Hanke told staff in an email. Niantic had around 800 employees at the end of last year.
OpenSea, an NFT marketplace, laid off 20% of its staff on July 14. CEO Devin Finzer tweeted, “We have entered an unprecedented combination of crypto winter and broad macroeconomic instability, and we need to prepare the company for the possibility of a prolonged downturn.”
Oracle, the database and cloud services company, is cutting workers in its US customer experience and marketing divisions. The company employs 133,000 people, according to its website.
Peloton Interactive Inc. announced plans to cut about 2,800 jobs globally in February, roughly 20% of its corporate roles, as part of a surprise shake-up that saw its CEO John Foley and several other top executives step down. On Aug. 12, the at-home fitness company announced its was eliminating an additional 800 jobs.
The company reported having nearly 9,000 employees in 2021. In a memo to employees provided to Bloomberg, CEO Barry McCarthy said, “We have to make our revenues stop shrinking and start growing again,” and added that the changes are essential to making Peloton cash-flow positive again. “Cash is oxygen. Oxygen is life,” he said.
Redfin Corp., another real estate brokerage, cut 8% of its staff in June. “We don’t have enough work for our agents and support staff,” CEO Glenn Kelman wrote in a blog post, saying that May demand was 17% below projections and that he expected the company to grow more slowly during a housing downturn. Redfin had about 6,500 employees at the end of last year.
Rivian Automotive Inc. laid off 6% of its workforce on July 27, after warning of it in a July 11 memo where CEO RJ Scaringe said, “We will always be focused on growth; however, Rivian is not immune to the current economic circumstances and we need to make sure we can grow sustainably.” The Southern California electric-vehicle maker has about 14,000 employees.
Robinhood, the online brokerage, has had two rounds of layoffs—cutting 9% of its workforce in April and another 23% in August, bringing the total number of employees dismissed this year to more than 1,000.
CEO Vlad Tenev attributed the move to overstaffing in 2021 and said, “We have seen additional deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash.
This has further reduced customer trading activity and assets under custody.” The company had about 3,800 employees at the end of last year and racked up more than $2 billion of losses since going public last July.
It’s also shuttering offices in Tempe, Arizona, and Charlotte, North Carolina, according to the SF Business Times.
Salesforce Inc., the cloud computing platform, has been slowing hiring and reducing travel expenses, according to a leaked memo reported in May by Insider. It had nearly 78,000 employees as of the end of April.
Shutterfly, a maker of personalized photo items, laid off 100 staffers in June, CEO Hilary Schneider told Bloomberg. The company, which has 7,000 employees, is making hiring adjustments to weather the economic uncertainty.
“Clearly we’re going through a period of economic choppiness on a global level,” she said. “When you look at the supply chain, it certainly is driving inflation and impacting consumer confidence.”
Shopify Inc., an e-commerce platform, is laying off 1,000 employees, 10% of its workforce, CEO Tobi Lutke said in a letter to employees on July 26. The affected jobs included recruiting, support and sales.
The company is offering 16 weeks of severance, career coaching, a laptop and internet allowance, home-office furniture and a free Shopify account for those who want to launch their own storefront. Shopify has 10,000 employees, according to its website.
SoundCloud, the music sharing website, is reducing its global workforce by 20% due to “the challenging economic climate and financial market headwinds,” CEO Michael Weissman said in an email to employees on August 3, seen by Billboard.
Spotify Technology SA, the audio service, is cutting employee growth by about 25% to adjust for macroeconomic factors, CEO Daniel Ek said in a note to staff in June. “I do believe only the paranoid survive,” he said on a conference call. “
And we are preparing as if things could get worse, but it’s hard to be anything but optimistic given what I am currently seeing.” Spotify has more than 6,500 employees, according to its website.
Stitch Fix, an online personalized styling service, said in June that it was pursuing a 15% reduction in salaried positions—about 4% of its workforce—with the majority coming from non-technology corporate jobs and styling leadership roles.
It’s coping with higher expenses and weaker demand. According to its website, the company has 8,900 employees.
Tesla Inc., the electric-vehicle maker, cut 200 autopilot workers as it closed a facility in San Mateo, California, in June. CEO Elon Musk said earlier that layoffs would be necessary in an increasingly shaky economic environment.
In an interview with Bloomberg, he said that about 10% of salaried employees would lose their jobs over the next three months, though the overall headcount could be higher in a year. The company had 100,000 employees globally at the end of last year.
Tonal Systems Inc., the home fitness startup backed by sports celebrities Steph Curry and Serena Williams, laid off 35% of its 750 employees on July 13, according to CNBC.
Twitter Inc. initiated a hiring freeze and began rescinding job offers in May, amid uncertainty surrounding Elon Musk’s acquisition of the company, according to an internal memo obtained by Bloomberg.
More recently, it said it would be paring back office space, but without job cuts. The company had 7,500 employees in 2021.
Unity Software Inc., which makes a video-game engine, surprised employees in June when it sent pink slips to 200 of its 5,900 workers, amounting to 4% of its workforce. Its CEO had assured staff there would be no layoffs, according to Kotaku.
Vimeo, a video sharing platform, cut 6% of the company in July. CEO Anjali Sud said in a blog post that it had slowed hiring since the beginning of the year. “The reality is that the challenging economic conditions around us have impacted our business.
We must assume that these conditions will remain challenged for the foreseeable future, and that we aren’t immune.
So while we’ve intentionally taken action across other expense areas first, it’s become clear that we also have to look at our largest area of investment, our team,” Sud said.
Wayfair Inc., the online furniture retailer, initiated a 90-day hiring freeze in May. The company had 18,000 employees as of March.
Whoop Inc., a fitness wearable startup, laid off 15% on July 22 and now has about 550 employees, according to a company statement reported by the Boston Globe.
Lyft Plans To Shut Down Its Car-Rental Unit And Cut About 60 Jobs
* Cuts Impact Less Than 2% Of Work Force, Are In Rentals Unit
* Lyft Earlier Said It Would Trim Expenses And Slow Hiring
Lyft Inc. will shutter its car-rental business and cut about 60 jobs as the ride-hailing giant grapples with a labor shortage and a fall in its stock price.
The layoffs impact less than 2% of Lyft’s roughly 4,600 total employees and are concentrated within the rentals unit. The news, which Lyft confirmed on Wednesday, was previously reported by the Wall Street Journal.
“We have decided to discontinue Lyft’s first party Rentals business to focus on our best-in-class third party Rentals with Sixt and Hertz,” spokeswoman Jodi Seth said in a statement. “This decision will ensure we continue to have national coverage and offer riders a more seamless booking experience.”
Lyft had said in May that it would slow hiring and trim expenses in parts of the company, which has been especially hard hit by a technology stock rout this year. Its shares have lost more than two-thirds of their value in 2022.
The stock decline accelerated when the San Francisco-based company indicated it would be ramping up spending on driver incentives to cope with a persistent labor shortage.
Uber Technologies Inc. has fared relatively better, with its shares down 43% this year. Uber Chief Executive Officer Dara Khosrowshahi said last month that the company is “recession resistant” and doesn’t see a need for job cuts.
Ford Plans To Cut Several Thousand Salaried Jobs
Staff cuts tied to goal of eliminating $3 billion in annual costs by 2026, people familiar with the matter said; Ford unveils plan to fortify EV supply chain.
Ford Motor Co. is planning to cut several thousand white-collar workers as it looks to trim costs to position the company for a long-range transition to electric vehicles, according to people familiar with the matter.
The auto maker in coming weeks is expected to disclose plans to eliminate more than 4,000 jobs, the people said. The cuts would mostly come from the Dearborn, Mich.-based auto maker’s North American salaried ranks and aren’t expected to include factory workers, the people said.
The cuts would target functions across Ford’s business, including engineering, marketing and sales and corporate functions, the people said.
Many of the cuts, which could include buyouts and early retirements, are targeted at employees who work on internal-combustion-engine vehicles, as Ford focuses on growing in electric cars.
The plans have yet to be completed and could change, the people said. Ford has about 43,000 salaried workers in North America, according to the company’s annual report.
The potential layoffs are tied to a goal recently set by Chief Executive Officer Jim Farley to achieve a 10% pretax profit margin by 2026, up from 7.3% last year, the people said. Mr. Farley has said he wants to eliminate $3 billion in annual structural costs by then.
Bloomberg News reported earlier Wednesday that Ford is preparing to cut up to 8,000 jobs.
Ford shares were up about 2.6% in pre-market trading Thursday.
Ford on Thursday outlined plans to fortify its EV supply chain, including adding new battery chemistries that would help overcome sourcing constraints on raw materials, particularly on nickel.
The U.S. auto maker also said it had struck an agreement with China’s Contemporary Amperex Technology Co. to provide batteries to plug-in models in North America, like the Mustang Mach-E, and is exploring ways to expand that partnership globally.
The moves have helped Ford secure enough battery materials and parts to build 600,000 electric-vehicles globally by late 2023, executives say.
Longer-term, Ford said it is targeting an annual production rate of making 2 million EVs globally, and has about 70% of the battery capacity secured to deliver on this goal.
“Given the importance of these materials to the success of our scaling, we aren’t leaving that to normal business as usual,” said Lisa Drake, vice president of Ford Model e and EV industrialization. Ford executives, speaking at a Thursday media briefing, didn’t respond to an analyst question about the job-cut reports.
Ms. Drake said that in the EV space, it is important for the company to stay lean and agile. “Believe it or not, to move fast in this space, smaller is better,” she said. “A smaller team can move faster than a larger team.”
Mr. Farley has said Ford needs to squeeze costs out of the internal-combustion part of its business, which today generates nearly all of its revenue and profit.
In March, Ford said it would divide the company into two divisions, one to focus on electric vehicles and other future technologies, and the other to handle the traditional gas- and diesel-engine side of the company.
Mr. Farley has said that developing electric, software-laden vehicles requires skills that go beyond the expertise of most Ford employees. He recently said he felt the company had too many workers and needed to trim staff to be nimble enough to compete in the electric-vehicle age.
“We have too much investment. We have too much complexity, and we don’t have expertise in transitioning our assets,” Mr. Farley said at a Wolfe Research auto conference in February.
He added that workers on the gas-engine side of the business don’t have the skills and digital expertise needed for developing EVs and that retraining them takes too long.
Tightening pollution regulations globally are prodding car companies to offer more electric vehicles, while rising gas prices in recent months has generated more consumer interest in EVs, surveys show.
Meanwhile, the surge in the valuations of EV companies like Tesla Inc. and some startups in recent years has persuaded traditional auto makers to tout their EV plans to investors, while also nurturing their internal-combustion lineups.
Auto makers globally are spending more than $500 billion through 2026 to develop electric vehicles, according to consulting firm AlixParnters LLP.
Mr. Farley, who became CEO in October 2020 and is president of Ford’s electric division, has said he believes Ford eventually can surpass Tesla in EV sales. The company rolled out its all-electric pickup truck, the F-150 Lightning, in April, and has cited a long waiting list.
Ford in recent years has cut thousands of jobs from its operations in Europe and South America amid a broad overseas restructuring, while its North American workforce has been more stable.
The company’s profits jumped in 2021 after declining for several years. It posted $10 billion in pretax earnings last year, up from about $2.5 billion in 2020.
Shopify Says It Will Lay Off 10% of Workers, Sending Shares Lower
CEO Tobi Lütke says company made wrong bet on pandemic-fueled boom in e-commerce growth lasting.
Shopify Inc. is cutting roughly 1,000 workers, or 10% of its global workforce, rolling back a bet on e-commerce growth the technology company made during the pandemic, according to an internal memo.
Tobi Lütke, the company’s founder and chief executive, told staff in a memo sent Tuesday that the layoffs are necessary as consumers resume old shopping habits and pull back on the online orders that fueled the company’s recent growth. Shopify, which helps businesses set up e-commerce websites, has warned that it expects revenue growth to slow this year.
Shopify’s shares fell 14% to $31.55 on Tuesday after The Wall Street Journal first reported on the layoffs. The shares have fallen more than 80% since they peaked in November near $175 adjusting for a recent stock split. The company reports quarterly results on Wednesday.
Mr. Lütke said he had expected that surging e-commerce sales growth would last past the Covid-19 pandemic’s ebb. “It’s now clear that bet didn’t pay off,” said Mr. Lütke in the letter, which was reviewed by the Journal. “Ultimately, placing this bet was my call to make and I got this wrong.”
The Ottawa-based company will cut jobs in all its divisions, though most of the layoffs will occur in recruiting, support and sales units, said Mr. Lütke.
“We’re also eliminating overspecialized and duplicate roles, as well as some groups that were convenient to have but too far removed from building products,” he wrote. Staff who are being let go will be notified on Tuesday.
Shopify’s job cuts are among the largest so far in a wave of layoffs and hiring freezes that is washing over technology companies.
Rising interest rates, supply-chain shortages and the reversal of pandemic trends, including remote work and e-commerce shopping, have cooled what was once a red-hot tech sector.
Netflix Inc. cut about 300 workers in June as it deals with a loss in subscribers. Twitter Inc., now mired in a legal standoff with Elon Musk, laid off fewer than 100 members of its talent acquisition team.
Mr. Musk’s own company, electric-vehicle maker Tesla Inc., late in June laid off roughly 200 people, after announcing it would cut 10% of salaried staff.
Other firms, including Microsoft Corp. and Alphabet Inc.’s Google, said they would slow hiring the rest of the year.
Tuesday’s announcement is Mr. Lütke’s first big move after Shopify’s shareholders approved a board plan to protect his voting power. The job cuts are the first big layoffs the company has announced since Mr. Lütke started the company in 2006.
Shopify’s workforce has increased from 1,900 in 2016 to roughly 10,000 in 2021, according to the company’s filings. The hiring spree was made to help keep up with booming business. E-commerce shopping surged during the pandemic, and many small-business owners created online stores to sell goods and services.
Shopify reported annual revenue growth of 86% in 2020 and 57% in 2021 to about $4.6 billion. However, the company reported a softening this year, and warned that 2022’s numbers wouldn’t benefit from the pandemic trends.
In his memo on Tuesday, Mr. Lütke said, “What we see now is the mix reverting to roughly where pre-Covid data would have suggested it should be at this point. Still growing steadily, but it wasn’t a meaningful 5-year leap ahead.”
Shopify has been expanding its business in recent years to provide more services for merchants. It has developed point-of-sale hardware for retailers, launched a shopping app for its merchants to list products and created a network of fulfillment centers to ship orders for its business partners.
In May, Shopify agreed to buy U.S. fulfillment specialist Deliverr Inc. for $2.1 billion in cash and stock. It announced partnerships with Twitter in June and with YouTube earlier this month, allowing users to buy items that Shopify merchants post on those platforms.
Shopify is offering 16 weeks of severance to the laid-off workers, plus one week for every year of service.
GM To Curtail Hiring As Profit Drops Sharply
Auto maker’s weaker results reflect challenges with supply-chain disruptions, including a shortage of semiconductors.
General Motors Co.’s net profit tumbled 40% in the second quarter, hurt by a loss in China and supply-chain troubles that left the company with tens of thousands of unfinished vehicles it couldn’t sell during the period.
GM executives reaffirmed the auto maker’s full-year profit outlook, saying they expect production to increase sharply in the second half as the computer-chip shortage eases, and that consumers continue to pay top dollar for new vehicles.
Still, the nation’s largest auto maker by sales on Tuesday missed analysts’ profit projections, after warning earlier this month that a drop in North American factory output would hit quarterly results.
Chief Executive Mary Barra said GM is taking precautions to guard against weakening economic conditions, including curtailing some hiring. Executives said layoffs weren’t in the plans for now, but said they are preparing a range of actions to respond if challenges worsen.
“We’ve run many different scenarios,” Ms. Barra told analysts. “We know the steps we would take if the situation went in a different direction.”
The Detroit-based car company said second-quarter revenue rose about 5% to $35.76 billion. Net income for the April-to-June period totaled $1.69 billion, down from $2.84 billion a year earlier.
GM reported pretax earnings per share of $1.14 in the second quarter, below the average analyst estimate of $1.23, according to FactSet.
GM shares fell about 3% in morning trading, a sharper drop than the broader market.
Ms. Barra told analysts during a conference call that GM’s vehicle inventories remain extremely tight and there is no sign that pent-up demand for new cars is waning after two years of tight dealership stocks.
“The customers are there for our vehicles,” she said. “They’ve been waiting, and all indications are they remain ready to buy.”
GM said early this month that a shortage of computer chips and other parts prevented the company from shipping 95,000 vehicles to dealers.
Company executives said Tuesday that they still expect to clear the backlog during the second half of the year as more parts become available and it is able to complete assembly of the partially finished vehicles.
The auto maker on Tuesday stood by its forecast for the full year of $9.6 billion to $11.2 billion in net profit.
Pressure surfaced in other parts of GM’s business, too, including in China, the company’s second-largest market, where its joint-venture business posted a rare loss of $87 million. The pretax profit margin in North America, which drives the bulk of GM’s bottom line, fell to 8%, from 10.4% a year earlier.
GM finance chief Paul Jacobson blamed the China loss on Covid-19 lockdowns and said the business is bouncing back.
“We see that as somewhat temporary,” he said of the weaker financial performance. “We continue to see big things for China.”
Ms. Barra said the company is cutting discretionary spending and limiting hiring. She said that a restructuring in 2019 and 2020 cut about $4.5 billion in annual costs, helping prepare GM for any downturn.
Across town, Ford is preparing to cut several thousand salaried jobs in North America to improve its cost structure as it prepares for a long-term transition to electric vehicles, The Wall Street Journal reported last week.
GM increased spending on electric vehicles, which contributed to a 43% drop in free cash flow in the quarter, to $1.4 billion.
Capital expenditures, which are largely targeted at EV development, rose by about one third, to $2 billion in the second quarter.
Separately, GM said it struck agreements with outside suppliers—South Korea’s LG Chem and Philadelphia-based Livent Corp. secure raw materials needed to build electric-vehicle batteries.
The pacts will help the company lock up enough battery capacity to hit its goal of one million electric vehicles in North America by 2025, GM said.
Cathodes use lithium, nickel and other materials that account for about 40% of the total cost of a battery, GM said.
GM and other auto makers have been taking pains to disclose more to Wall Street about how they plan to put the industrial pieces in place to mass-produce electric cars.
Investor enthusiasm for EV-related stocks soared last year amid signs that battery-powered vehicles are poised for strong growth. Since then, shares in EV makers have pulled back sharply, in part because of missed production forecasts.
Ford last week outlined several steps it is taking to boost production of batteries and electric models, including an agreement to source iron-based batteries from China’s Contemporary Amperex Technology Co.
Ford reports second-quarter results Wednesday, followed by global auto maker Stellantis NV, which plans to release its latest earnings report early Thursday.
Analysts have raised questions about whether a future battery shortage could curb the auto industry’s EV ambitions. Both GM and Ford have said they aim to overtake Tesla Inc. in U.S. electric-vehicle sales.
Meanwhile, traditional car companies face a host of challenges in their core business of building internal-combustion-engine cars, which still fuel nearly all of their profits.
Rising interest rates could damp consumer demand, while higher raw-material costs are eroding profits and leading car companies to raise vehicle prices.
The computer-chip shortage continues to scramble auto makers’ production schedules, complicating efforts to replenish depleted dealership lots.
With inventory levels near all-time lows, the average price paid for a new vehicle in the U.S. hit a record of about $45,800 in June, nearly 15% higher than a year earlier.
Ford CEO Farley Says Automaker ‘Absolutely Has Too Many People’
Ford Motor Co. Chief Executive Officer Jim Farley says his company has too many people, but he won’t say how many he plans to get rid of.
On a call with analysts to discuss Ford’s strong second-quarter earnings, Farley made it clear Wednesday that job cuts are coming. Bloomberg News reported earlier that the company is planning to slash as many as 8,000 salaried positions.
“We absolutely have too many people in some places, no doubt about it,” Farley said in response to a question from Morgan Stanley analyst Adam Jonas. “We have skills that don’t work any more, and we have jobs that need to change.”
Farley is seeking $3 billion in cost cuts, primarily from the newly named Ford Blue unit responsible for producing traditional internal combustion engine vehicles, such as the Bronco sport-utility vehicle.
The automaker plans to spend $50 billion in the coming years so Ford can pump out 2 million electric vehicles a year by 2026. Farley has said he intends to fund that EV expansion by transforming Ford Blue into “the profit and cash engine for the entire enterprise.”
“We know our costs are not competitive at Ford,” Farley told the analysts. “We are not satisfied.”
The automaker has already begun cutting costs to try to simplify its business and boost profit, Farley said. And that means it will need fewer people.
“The tension point for us, though, is complexity. Ford is way too complex,” Farley said. “We are planning much less complexity in our Blue business and that is a theme that will run through Blue for years to come.”
Top Talent Is Migrating To Web 3
Chief Investment Officer of Rockaway Blockchain Fund takes an investors view on the talent wars between Web 3 and Web 2.
It isn’t often you’d hear tech companies described as dinosaurs, but they are indeed now just that and need to evolve or risk being relegated to an era past.
The largest tech giants, including Amazon, Google and Meta Platforms, have become too accustomed to the outdated business models of ad monetization, an industry that is growing 15.7% annually.
Ad tech is still an appealing opportunity, but blockchain has a much higher growth potential.
Traction metrics in Web 3 are growing through the roof. For example, daily active addresses on Ethereum grew from 200,000 in January 2020 to 550,000 today, increasing about 65% per year..
Revenue of Ethereum skyrocketed from $200,000 per week in January 2020 to $31 million per week today. And the rise of new layer 1 protocols shows even more impressive growth. Solana daily active addresses grew from zero in January 2020 to 550,000 now, the same level as Ethereum.
Continuing to master the 20-year-old online advertising business model is not interesting enough for top talent any more.
These people – some of the smartest and most educated among us – are looking for new opportunities that Web 3 happily provides.
This trend may have started with the “creator economy” as more independent-minded people sought their own opportunities and has bled into Web 3’s “ownership economy.”
We are seeing a massive inflow of technologists. The Electric Capital developer report of public GitHub repositories associated with blockchain projects shows 100% growth since last year.
It’s not only the developers, but executive talent, too. The former chief marketing officer (CMO) of Meta’s wallet project, Novi, took a CMO position at Circle; the former general manager of Amazon’s AWS Edge Services is now chief technology officer of Gemini, and Lyft’s former finance chief and Uber’s ex-director of corporate development have both joined OpenSea.
Then there’s Chris Lehane, a former Airbnb executive, who left for a crypto venture capital fund, while YouTube’s former head of gaming jumped over to Polygon Studios, which caters to Web 3 developers. The list goes on and on.
Add to this the immense funding that blockchain startups received in 2021 – $33 billion, which was 8.1 times the amount from the previous year.
The demand for tech talent in Web 3 is massive. In the U.K., job postings mentioning blockchain are at an all-time high, and according to LinkedIn, job postings in the industry saw growth of 400% since 2020.
And at Rockaway Blockchain Fund, we are seeing the interest in this technology with our own eyes. Each of our portfolio companies is hiring. At the Hacker House in Prague, which we co-hosted with Solana, there were more than 30 teams presenting on demo day, and 800 developers present from all across Europe, either building or looking to extend their teams.
We are expecting a similar turnout at the upcoming Gateway Conference and Hackathon in Prague for the Cosmos ecosystem. This is massive growth since our pre-COVID hackathon with Binance & Oasis Labs, where roughly 30 developers attended.
This data showcases the traction of the industry and solidifies our conviction as long-term, value-add investors in Web 3. Combining the incentive alignment of the ownership economy of Web 3 with top tech talent and massive funding is exactly what a venture investor looks for.
Interns Are Making Over $16,000 A Month As Wall Street Talent Wars Heat Up
Top global investment banks boosted intern compensation by 37.2% this year.
As top firms shell out millions in the battle for Wall Street’s best and brightest, even interns are seeing their compensation soar.
Top global investment banks boosted intern pay by 37.2% for the current internship season from a year earlier, while other large banks are paying 36.9% more, according to finance career site Wall Street Oasis.
It’s been a particularly tough recruitment year for Wall Street. As many industries struggle to hire workers in a constricted labor market, the finance sector has simultaneously experienced high employee turnover and dissatisfaction among junior bankers who notoriously grind through 100-hour workweeks.
Traditional areas of banking are now finding themselves competing with hip tech companies that offer more casual and flexible workplaces and more lucrative finance shops like private equity firms. As the talent war hits a fever pitch, the banking industry is boosting interns’ pay to help bolster its entry-level pipeline.
Wall Street Oasis founder Patrick Curtis said the growth in compensation for prospective junior bankers over the past year is the highest he’s seen since launching the company in 2006. And it’s not just the banks: interns at proprietary trading firm Jane Street are making an average salary of $16,356 a month — the equivalent of nearly $200,000 a year. Jane Street didn’t respond to a request for comment.
“These are record numbers for intern pay, especially what we are seeing in 2022,” Curtis said.
Hedge funds, high-frequency and proprietary trading firms topped the list for intern compensation, followed by investment banks, with the top eight paying a median salary above $10,000 a month, according to Wall Street Oasis. A typical internship at finance firms lasts anywhere from 10 to 12 weeks over the summer, although some offer extended training programs.
For the 0.8% of applicants who successfully secure an internship at top hedge fund Citadel, the median monthly pay is $14,000 or greater depending on the role — usually either a software engineer, trader or quantitative researcher, according to a spokesperson for the firm. Point72 Asset Management confirmed that it offers $10,750 a month to students in its investment analyst internship, which lasts eight weeks during the summer.
Credit Suisse said the figures provided were inaccurate due to the fact that there are several variables that determine an intern’s pay, but wouldn’t confirm what its pay range is. The rest of the firms on the list declined to comment or have yet to respond to Bloomberg’s requests.
Curtis at Wall Street Oasis explained that firms usually determine compensation by how technical the role is, with quantitative trading and engineering internships usually paying the most.
According to careers site Glassdoor, software engineering and investment banking analyst internships have the highest median pay at the companies it surveys. Location may also influence intern compensation, with positions in cities with high costs of living like New York or San Francisco often paying higher wages.
Unsurprisingly, interns pursuing advanced degrees also get a small leg up when it comes to pay. According to the National Association of Colleges and Employers, an intern studying finance in the first year of a master’s program earned an average of $31.47 per hour compared to $19.67 for undergraduate seniors and $21.34 for juniors during the 2019-20 academic year.
The crowdsourced data from both Glassdoor and Wall Street Oasis are based on user submissions from undergraduate and graduate students from 2021 to 2022. Wall Street Oasis primarily collects data on compensation in the finance sector, while Glassdoor collects data from major companies across several industries.
For years, Wall Street was the place to be for young and hungry new grads hoping to forge successful careers. Then, the financial industry’s reputation took a hit for its role in the subprime mortgage crisis and young recruits began flocking to buzzy Silicon Valley companies.
According to Glassdoor economist Lauren Thomas, the tech industry has solidified its place as a top spot for new talent in recent years. Two years ago, the tech industry represented less than half of the companies on Glassdoor’s highest-paying internship list. Now, Silicon Valley companies make up 68%.
“This shows how tech and finance industries are competing fiercely for talent and that competition for quality talent is only growing in today’s job market,” Thomas said.
Video-game platform Roblox Corp. topped Glassdoor’s list of the top-paying internships with a monthly salary of $9,667 a month. A spokesperson for Roblox said the company pays its interns $58 to $60 an hour.
But the tides may now be shifting as financial firms shell out as much as eight-figure pay packages for top talent, while big tech companies lose some of their luster as their stock prices fall. In 2021, the share of internships paying over $8,000 a month increased by 33% in finance and 22% in tech, according to Glassdoor data.
During the most recent intern recruitment cycle, savvy college students are showing signs that their sights may be set on Wall Street once again.
A record 236,000 people globally applied to Goldman Sachs’s highly competitive internship program, a 17% jump from 2021, Business Insider reported. Morgan Stanley also reported an increase in applications for the most recent internship cycle, but the bank did not confirm how many it received.
Curtis suggested that the surge in applications may be due to the unprecedented pay increase for junior bankers, who are now seeing six-figure offers to start. Earlier this month, UBS Group AG boosted salary for first-year analysts for the second time in less than a year to compete with Citigroup Inc. and JPMorgan Chase & Co., which set the new standard pay for junior bankers at $110,000 a year.
Still, he thinks Silicon Valley retains the power to lure talent away from Wall Street.
“I’ve never seen such an acceleration in pay for junior investment bankers in such a short period of time,” Curtis said. “But a dramatic rise in pay isn’t enough to stop the attrition and the brain drain to Silicon Valley.”
Coinbase Pares Back Hiring Plans Amid Weak Earnings, Poor Market Condition
The exchange previously planned to hire as many as 2,000 employees earlier this year.
Crypto exchange Coinbase (COIN) will slow down hiring and reassess headcount needs as the broader crypto market sees a downturn, the firm said in a note to employees.
“We’re slowing hiring so we can reprioritize our hiring needs against our highest-priority business goals,” said Emilie Choi, president and chief operating officer at Coinbase, in the note.
Choi added the move was to ensure the business was “best positioned to succeed during and after” the current market downturn. “Market downturns can feel scary … we plan for all market scenarios, and now we are starting to put some of those plans into practice,” Choi said.
The move is a departure from Coinbase’s plan to triple its headcount earlier this year, as reported. The exchange planned to hire up to 2,000 people to expand its product, engineering and design teams as recently as February.
Choi stated the crypto exchange remained in a strong position and had a “solid balance sheet” to make it through a market downturn.
The note comes days after a weak earnings report last week. Coinbase reported $1.17 billion in revenue for the first quarter this year, compared with analysts’ average estimate of $1.5 billion, according to FactSet.
The exchange also reported a quarterly net loss of $430 million, compared with a profit of $840 million in Q4 2021. Shares tumbled 26% following the report, adding to a nearly 70% decline in the past year.
Premarket futures rose 7.3% as per MarketWatch data. A lower headcount could mean slightly lower costs to the business and help increase profits.
Crypto Job Market Holding Up Despite Tech Industry Cutbacks
Crypto-specialist recruiters say they have not witnessed a downturn in crypto-related job opportunities, despite a myriad of staff lay-offs in the wider tech industry.
The crypto job market shows few signs of slowing down despite high-profile cases of staff layoffs and hiring freezes across big tech companies.
In recent weeks, several major tech companies have announced a paring back of staff, citing a downturn in the traditional market and narrowing demand for products that had boomed during the pandemic. Recently announced hiring cuts include Twitter, Uber, Amazon and Robinhood.
On Tuesday, movie streaming service Netflix terminated the roles of 150 mostly United States-based employees amid a slowdown in revenue growth.
Earlier this month, Facebook parent company Meta instituted a hiring freeze for most of its mid- and senior-level positions after failing to meet revenue targets.
The crypto industry has not been totally immune. On Tuesday, Coinbase announced it was slowing down its hiring, after posting a $430 million loss in Q1.
Coinbase chief operating officer Emelie Choi told employees in an internal memo that plans to triple the headcount in 2022 were on hold due to market conditions that require the company to start “slow hiring and reassess our headcount needs against our highest-priority business goals.”
So, are we at the beginning of a major slow down in crypto industry hiring? Crypto recruiters Cointelegraph spoke to don’t think so.
We’ve been hearing about a big slowdown in tech but we’ve hardly noticed it other than many more candidates looking to enter the crypto markets. We’ve been overwhelmed with requests for quality candidates and have positions across all sectors.— Cryptorecruit (@cryptorecruit) May 18, 2022
“We have not seen a slowdown in crypto hiring. We are as busy as ever,” said Neil Dundon, founder of Crypto Recruit.
Dundon’s Firm Specializes In Recruiting Exclusively Within The Blockchain And Cryptocurrency Space:
“We have a team based globally across the US, Asia/Pac and European regions and demand is equally as high across the region.”
Kevin Gibson, founder of Proof of Search, told Cointelegraph that lay-offs in the tech sector have had little to no impact on his crypto industry clients so far.
“I’ve only heard of two companies letting people go,” said Gibson. “This may change in the next month, but any slack will immediately be taken up by well-funded quality projects. As a candidate, you won’t notice any difference. if you do lose your job, you will also have multiple offers pretty quickly.”
VC Funding Runways
Gibson said that most crypto projects are still in the startup and early stages of their life cycle, and are still operating off venture capital (VC) funding secured last year:
“The vast majority of quality projects were funded last year, so they will continue to build and hire. There was such an imbalance of talent to role that any pull back from pre-funded projects will not be noticed.”
CB Insights’ “State of Blockchain Q1 22” report stated that blockchain and crypto start-ups saw a record-breaking funding quarter, with venture funding reaching an all-time high in the three-month period, raising $9.2 billion and beating the preceding quarter of $8.8 billion in Q4 2021. It was the seventh-consecutive quarter of record blockchain funding.
Dundon said he has seen more traditional tech companies and employees venturing into the crypto space, further enriching the crypto job market:
“At a minimum, most forward thinking tech companies are allocating some budget to look at how they might incorporate blockchain into their existing models. Not only are more companies venturing into this space but candidates are flocking over as traditional tech downsizes.”
A study from LinkedIn released in January this year found that crypto-related job postings surged 395 percent in the U.S. from 2020 to 2021, compared to only a 98 percent increase in the tech industry in the same period. The most common job titles demanded included blockchain developers and engineers.
According to Glassdoor, the average annual blockchain developer salary is $109,766. The average annual blockchain engineer salary sits slightly lower at $105,180.
When asked whether the current crypto bear market may translate to more crypto company lay-offs, Dundon said that he doesn’t expect a similar situation to play out as it did in 2018.
“Crypto hiring in the past has tended to slow right down when the Bitcoin price tumbles. It was almost directly correlated to its price,” explained Dundon:
“This time, it’s different, though, as crypto companies now manage their treasuries in a much more responsible manner. This all translates to a much more stable hiring market.”
Top Latin American Crypto Exchange Bitso Lays Off 80 Employees
The company, which had more than 700 workers before the cuts, counts four million users in the region.
Latin American crypto exchange Bitso laid off 80 employees on Thursday, the company told CoinDesk.
“Our decisions about the people who work in our company are made on the basis of our long-term business strategy and to support our customers and our strategy as a company,” Bitso said in a statement.
Bitso, which had more than 700 employees before the layoffs, still lists more than 60 open positions on its jobs page.
In its statement, the company mentioned the need to rethink the skills it needs from employees to move faster in the crypto industry as reasons for the cutbacks. It did not mention any difficulties in raising capital.
Bitso’s layoffs come two days after the Argentina-based crypto exchange Buenbit laid off 45% of its staff — or roughly 80 employees — due to the “global overhaul” the tech industry has entered, according to its CEO, Federico Ogue.
Bitso has more than four million users in Mexico, Argentina, Colombia and Brazil. The company told CoinDesk in January that it’s aiming to become the largest exchange in Brazil before the end of 2022. In Brazil, Bitso competes with local crypto exchange Mercado Bitcoin, the leader with more than four million customers.
Bitso’s latest investment round was in May 2021, when it raised $250 million at a valuation of $2.2 billion, making it the first Latin American crypto unicorn.
17 States Where Unemployment Is At Record Lows
Rates for the unemployed have never been lower in these states two years after Covid-19 drove the national jobless rate to a record high.
The unemployment rate in 17 states concentrated in the Midwest, South and Mountain West reached a record low in April, a sign of an unusually tight labor market.
The milestone in those states marks a sharp reversal from the spring of 2020, when the Covid-19 pandemic drove unemployment to record highs in 15 of those states, according to Labor Department data tracing back to 1976.
Two additional states—Oklahoma and Arkansas—hit record low unemployment rates earlier this year.
In Nebraska, where jobs in pandemic-resilient industries such as agriculture and food-processing abound, the jobless rate clocked in at 1.9% in April. The state tied Utah for having the lowest unemployment rate in the nation. Other Midwest and Mountain West areas reached record low jobless rates, as did Southern states such as Alabama, Georgia and Tennessee.
Unemployment has fallen across the U.S. after the national unemployment rate skyrocketed to 14.7% in April 2020, the highest for data going back to 1948. Businesses temporarily closed their doors and Americans stayed at home when Covid-19 hit, but reopenings that summer spurred a rapid jobs recovery.
In many states that are more rural and less densely populated, different factors have driven unemployment to record lows since the onset of Covid-19. Those factors include looser restrictions and industry-job mixes more resilient to the pandemic, economists say.
Low joblessness suggests the labor market, a pillar of the economy, is still running strong, despite volatility in stocks, bonds and other assets reflecting investor fears that the U.S. is headed toward an economic downturn. Employers continue to cling to their employees, and many workers who want a job can easily find one.
Low unemployment is also symptomatic of an unbalanced economy in which there are too few job seekers to keep pace with a surge in consumer spending and employer demand for workers.
“Any time you have trillions of extra dollars sloshing around in the economy chasing more goods and services that are being produced by fewer people, you’re going to have this very, very tight labor market,” said Julia Pollak, chief economist at jobs site ZipRecruiter.
Mismatches between job openings and available workers are particularly acute in some states, creating more-extreme ratios than the national average of two openings for every out-of-work job seeker. In Nebraska, there were about 3.5 job openings for every unemployed person seeking work in March.
Employers across the nation are ramping up wages to attract workers in a tight labor market. In April, average hourly earnings rose 5.5% from a year earlier, well above the roughly 3% increase at the end of 2019, before the pandemic hit.
Workers who reap wage increases are able to save, or spend money on airplane tickets, meals out and hotels. But employers who have to pay workers more might pass along price increases to stay profitable, threatening to keep inflation elevated when it is already near a four-decade high.
States including Arizona and Georgia have record-low jobless rates and solid wage growth. But major cities in those states are also confronting inflation that exceeds the national rate of 8.3%. The Phoenix and Atlanta metropolitan areas saw consumer prices rise by 11% and 10.8%, respectively, in April compared with a year ago.
The Federal Reserve is increasing interest rates to help tame inflation. That will likely be particularly beneficial to states with very low unemployment rates that would otherwise “have a harder time getting inflation under control” than less-tight labor markets, said Daniel Zhao, senior economist at Glassdoor.
Labor-force participation rates—which represent the share of the population working or seeking a job—tend to be higher in states with record low unemployment rates.
For instance, Nebraska, with a 1.9% unemployment rate, saw the highest labor-force participation of any state in April. Other states—including Utah, South Dakota and Minnesota—also had low joblessness accompanied by relatively high labor-force participation.
Some of the factors that have triggered low jobless rates in states are specific to the pandemic. For instance, looser government restrictions on businesses helped keep unemployment rates in many states lower throughout the pandemic, economists say.
That included many states in the South. Others that restricted activity for longer periods—including Northeastern states such as New York, Massachusetts and Connecticut—still have more ground to recover before reaching prepandemic rates of unemployment.
Places with a higher concentration of goods-producing jobs in manufacturing and warehousing have been better able to endure the pandemic’s effects, Ms. Pollak said, pointing to Elkhart, Ind., an RV manufacturing center, as an example.
In contrast, states with a large presence of customer-facing jobs at restaurants, bars and hotels cut jobs at a rapid rate amid pandemic shutdowns and consumer pullback in early 2020. More than two years after Covid-19 struck, job-market recoveries in those states are still lagging behind others, though they are making progress as the pandemic’s grip eases.
For example, unemployment rates in Hawaii and Nevada surged to respective highs of 22.4% and 28.5% in April 2020, as the tourism-heavy states suffered from the lack of visitors. By April of this year, their unemployment rates were still above the national rate of 3.6% but had declined to 4.2% and 5%.
“When you disrupt employment that much, it can take a long time for it to recover,” Ms. Pollak said. “The tourist numbers will return faster than the businesses that employ the service workers.”
Fidelity Digital Assets Plans To Double Staff This Year
The firm is planning to add 110 employees in tech roles, including engineers and developers with blockchain experience.
Fidelity Digital Assets, a subsidiary of the financial services giant Fidelity Investments, plans to double its headcount this year to meet the growing demand for crypto trading from institutional investors, the Wall Street Journal reported on Tuesday.
* The business is planning to add 110 employees in tech roles, including engineers and developers with blockchain experience, Fidelity Digital Assets President Tom Jessop said, according to the report.
* The expanded headcount will be used to build infrastructure to offer trading of ether. Fidelity Digital Assets has hitherto offered only bitcoin (BTC) support.
* It aims to provide faster transactions and 24-hour trading support as well as compliance and tax-reporting tools.
* Growing its tech team and providing support ether (ETH) support would signal Fidelity’s intent to expand into the crypto industry.
* “The incredible energy around digital assets as an emerging asset class makes this an interesting time for anyone looking to move into a career in the space, including those working in more traditional areas within financial services,” Jessop said.
* The financial services firm, which has over $4.5 trillion assets under management, said last month it will allow investors to put bitcoin into their 401(k) retirement savings accounts later this year.
* Fidelity Digital Assets now has about 400 clients, including investment advisers, hedge funds and asset managers, head of product Terrence Dempsey said, according to WSJ’s report.
Brazilian Crypto Unicorn 2TM Lays Off Over 80 Employees
The company cited “the changing global financial landscape.” Its main competitor in Latin America, Bitso, laid off a similar number of people last week.
2TM, the holding company for Mercado Bitcoin, Brazil’s largest crypto exchange by market valuation, laid off over 80 employees on Wednesday.
“The changing global financial landscape, rising interest rates and inflation have been having a major impact on technology-based companies,” 2TM said in a statement. It did not mention an exact number of layoffs, although it did publish a list with 86 profiles of fired employees, along with their contacts.
The company also said that “the scenario required adjustments that go beyond reducing operational expenses, making it necessary also to lay off part of our employees.”
According to its LinkedIn page, Mercado Bitcoin Market has more than 580 employees, while 2TM has more than 80.
2TM’s announcement comes a week after Latin American crypto exchange Bitso, Mercado Bitcoin’s main competitor in Brazil, laid off 80 employees citing “long-term business strategy” as the reason.
Also last week, the Argentina-based cryptocurrency exchange Buenbit laid off 45% of its staff – 80 employees, approximately – due to the “global overhaul” of the tech industry, the company said.
2TM became the second crypto unicorn in Latin America after raising a total of $250 million in 2021 at a $2.2 billion valuation.
In January, it acquired a controlling stake in CriptoLoja, Portugal’s first regulated crypto exchange, while it planned to enter the Spanish-speaking part of Latin America through acquisitions in Argentina, Chile, Colombia and Mexico, 2TM CEO Roberto Dagnoni told CoinDesk in June 2021.
In March, Mercado Bitcoin was in talks to be acquired by crypto exchange Coinbase Global (COIN), but negotiations failed, Bloomberg reported in May.
Major Crypto Firms Reportedly Cut Up To 10% Of Staff Amid Bear Market
Previous crypto bear markets triggered much bigger layoffs, with some firms like ConsenSys reportedly firing up to 60% of its workforce in 2018.
Gemini, a cryptocurrency trading platform founded by brothers Cameron and Tyler Winklevoss, is the latest industry firm to lay off a significant part of its staff due to unfavorable market conditions.
Winklevoss’ crypto business Gemini Trust reportedly cut 10% of its employees amid the ongoing bear crypto market, the founders wrote in a notice to employees on June 2, as Bloomberg reported.
As part of its first major headcount cut, Gemini will refocus on products that are “critical” to the firm’s mission, the brothers said, adding that “turbulent market conditions” are “likely to persist for some time.” The notice reportedly reads:
“This is where we are now, in the contraction phase that is settling into a period of stasis — what our industry refers to as “crypto winter. […] This has all been further compounded by the current macroeconomic and geopolitical turmoil. We are not alone.”
The new report comes after a number of major industry companies fired some employees or put new hires on hold. In late May, the major Latin American crypto exchange Bitso laid off 80 employees, citing internal issues.
“We found that the state of our organization was not representing our business and go-to-market strategy to the best of Bitso’s ability, which led to our internal restructuring,” a spokesperson for Bitso told Cointelegraph.
Previously, the Coinbase exchange officially announced in mid-May that it would slow down hiring and reassess its headcount in order to ensure it continues operating as planned.
The major crypto-friendly trading platform Robinhood also fired 9% of its workforce in April. The layoffs came amid Robinhood’s HOOD stock touching all-time lows as part of a longer-term bear market on crypto markets.
The latest crypto industry layoffs are by no means new to the industry as major crypto markets like Bitcoin (BTC) have been historically moving in cycles, with major bear markets preceding bigger gains.
Amid a massive bear market of crypto in 2018, some industry firms like ConsenSys reportedly fired up to 60% of their workforce, announcing plans to hire 600 employees afterward.
According to some sources, the current conditions of the crypto job market do not look too gloomy though. A spokesperson for the FTX crypto exchange told Cointelegraph that the firm has not cut and does not plan to lay off any of its current 175 employees at the global exchange or 75 employees at the FTX US.
Per crypto hiring website by the Bitcoin influencer Anthony Pompliano, executives in the crypto and blockchain industry are still looking to hire people, with the PompCryptoJobs website listing about 600 open positions at the time of writing.
The major global crypto exchange Binance is looking to hire nearly 1,000 employees, according to its official job openings website.
Gemini did not immediately respond to Cointelegraph’s request for comment.
Citigroup Plans To Hire 4,000 Tech Staff To Tap Into ‘Digital Explosion’
* Firm Seeks To Put More Institutional Client Services Online
* Demand For Tech Workers Has Intensified Across Industries
Citigroup Inc. plans to hire more than 4,000 tech staff to help move its institutional clients online in the wake of the pandemic.
More than 1,000 of the recruits will join the markets technology team as part of an aggressive growth strategy, Jonathan Lofthouse, head of markets and enterprise risk technology, said in an interview.
“We’re trying to digitalize as much of our client experience as possible, front and back, and modernize our technology,” he said. “Those firms that can digitalize fastest are going to create competitive advantage.”
Banks are upgrading decades-old technology platforms to make services available remotely for both clients and workers, with multibillion-dollar programs that investors are watching closely for signs that this largess will eventually boost returns.
At Citi, Chief Financial Officer Mark Mason said in March the lender raised tech spending by 10% to $10 billion last year. JPMorgan Chase & Co. boss Jamie Dimon said last month he just wants “to get it done” on the technology front, amid broader shareholder scrutiny of the bank’s expenses.
Data specialists are in particular demand across banking and the wider jobs market. Lofthouse said pay was a factor in getting new workers through the door, but training and flexible working models would help to keep them. Citi currently has more than 30,000 software engineers.
“Everyone in lockdown suddenly had to do everything digitally, whether that was getting groceries delivered or watching more Netflix,” he said. “We’ve always seen the tech market to be competitive but particularly at the moment, coming out of the pandemic, we’ve seen a digital explosion across industries.”
FTX Will Not Freeze Hiring Amid Layoffs At Other Crypto Firms, CEO States
FTX CEO Sam Bankman-Fried explained that the exchange will continue to “keep growing” during the bear market.
Amid unfavorable market conditions, some cryptocurrency-related firms decided to cut their workforce or freeze hiring. However, crypto exchange platform FTX will continue hiring new personnel as the crypto winter continues.
In a Twitter thread, FTX CEO Sam Bankman-Fried explained that the exchange will continue to “keep growing,” explaining that they will onboard new staff just as they have done on the market’s better days.
Bankman-Fried noted that in February the company slowed down hiring. However, he said that this is not due to a lack of funds. The move was done to make sure that team members can have enough time to properly mentor new employees before adding more.
13) A lot of reporters have reached out asking if we’re going to be scaling back.— SBF (@SBF_FTX) June 6, 2022
And our answer is the same as always:
We’re going to keep pushing forward.
Criticizing hypergrowth companies, Bankman-Fried underscored that hiring more staff quickly doesn’t equate to a substantial increase in productivity. “Sometimes, the more you hire, the less you get done,” he said. He explained that this is because rapid growth can make it very difficult to keep all staff “on the same page.”
Moreover, because FTX took its time and hired employees carefully since February, Bankman-Fried mentioned that the exchange can keep its hiring pace as it is “regardless of market conditions.”
At the start of June, crypto exchange Gemini laid off 10% of its employees. According to a notice from the exchange, the move was due to the current “crypto winter.” Apart from Gemini, Coinbase also decided to slow down hiring back in May.
Back in 2018, the industry witnessed larger layoffs as the market went down. Crypto miner manufacturer Bitmain and crypto exchange Huobi confirmed that they fired employees amid the 2018 bear market. Apart from the two, blockchain company Consensys reportedly dropped around 60% of its staff before announcing the hiring of 600 employees in 2022.
Coinbase Retracted Job Offers To Recruits From Some Of Wall Street’s Biggest Banks
Individuals from at least 10 of the biggest financial firms left Wall Street to join Coinbase Global Inc. only to have the company rescind their employment offers.
Goldman Sachs Group Inc., Morgan Stanley, BlackRock Inc., Wells Fargo & Co. and Citigroup Inc. were among the firms that people departed to join Coinbase, according to a talent directory posted by the company.
They’re part of a group who last week received an email from the largest US cryptocurrency exchange rescinding offers and announcing a freeze on hiring for the “foreseeable future.”
A Coinbase spokesperson declined to comment, instead pointing to a June 7 blog post by the company’s chief people officer announcing a new talent hub to help the affected individuals. So far, more than 300 individuals have appeared in the portal.
Coinbase was also hiring software engineers from banks including Credit Suisse Group AG, Capital One Financial Corp. and Goldman Sachs, as well as hedge funds Millennium Management and AQR Capital Management.
Several tech companies, including Uber Technologies Inc., Amazon.com Inc., Meta Platforms Inc., Twitter Inc. and TikTok, were also listed in the hub.
Coinbase cited market conditions and ongoing business “prioritization efforts” for forcing it to freeze hiring. Along with the plunge in crypto prices, Coinbase shares have tumbled by more than 70% since its April 2021 initial public offering.
The company ballooned to 4,948 full-time employees from about 1,700 just a year ago.
Crypto Firms Cut Back On Hiring During Market Slump
Fed’s move to increase interest rates is contributing to a selloff and putting pressure on fees.
Cryptocurrency firms have slammed the brakes on their spending spree in response to the continuing crypto price slump.
In the past few weeks, Coinbase Global Inc., the largest American crypto exchange, rescinded offers to employees who accepted jobs and said it would slow its hiring pace. Another crypto exchange, Gemini Trust cut 10% of its staff, citing the effects of the market downturn.
After hiring doubled from November to April, crypto firms slowed hiring in May, according to data collected by ManpowerGroup. The top three employers in the crypto space as of last month were Block Inc., Coinbase and Gemini, according to ManpowerGroup.
The Federal Reserve’s interest-rate increases have contributed to a market selloff, with speculative assets being hit the hardest. Since November, bitcoin has fallen 55% and the entire crypto market has dropped 59%.
That selloff has lowered the volume of crypto trading, and it is forcing some companies to work to adjust, said Kavita Gupta, founder of the investment firm Delta Blockchain Fund.
“Companies that went public or expanded during the high-peak time and did not figure out their balance sheet for three years of cash flow have to tighten their belt,” she said.
For exchanges including Coinbase, transaction fees are the prime source of revenue. In its most recent earnings report, the company said that trading activity in the first quarter was down by about half from the fourth quarter, and that it expected the trend to continue in the second quarter. Coinbase declined to comment.
In a blog post, Gemini’s founders, Cameron Winklevoss and Tyler Winklevoss, said the job cuts were in response to a “contraction phase” in the crypto market and a decision to focus only on products that were absolutely critical.
At the hiring website CryptoJobs, the number of job listings has fallen by 20% over the past two months, according to project manager Evy Lee.
Daniel Adler, founder of Cryptocurrency Jobs, another job-posting website, said that some of his crypto clients brushed off the initial crypto selloff in the first quarter, but now have implemented freezes and slowed their pace of hiring.
“It has a lot to do with how much funding they’ve raised, or product/market mix,” he said.
Jobs in overall online companies are doing better, rising to 2.97 million in May from 2.95 million in April, according to the Bureau of Labor Statistics.
Mr. Adler said clients told him that wider problems in the global economy such as inflation and the effects of the Ukrainian invasion have forced their companies to change plans, he said.
Venture firms are still investing in the crypto sector, with high-profile funds recently announced by Binance and Andreessen Horowitz. But the pace is starting to show some easing.
In the second quarter, crypto firms have raised $6.8 billion so far, according to the research firm PitchBook. That is down from $10 billion in the first quarter.
Another area in which crypto companies are cutting costs is in advertising.
While crypto companies are spending more this year than last, they have been slowing their roll. Crypto firms spent $10 million in advertising spending in April, the lowest amount since September, according to the research firm MediaRadar. In February, Super Bowl ad spending lifted the month’s total to $73 million.
Four companies—Coinbase, FTX, Crypto.com and eToro Group Ltd.—accounted for virtually all of that spending. Excluding their contributions, crypto ad spending fell from $2 million in February to $1 million in April.
Bitcoin’s cratering price has cut into the profits at cryptocurrency mining companies, some of which are publicly traded. Daily collective miner revenue has fallen by about 56% since November, the research firm Glassnode estimates, to about $27 million from $62 million.
Not every company is retrenching, though. Over the past year, Toronto-based Hut 8 Mining added new businesses, including a hardware-repair operation, and raised capital in anticipation of an eventual slowdown, said Chief Executive Jaime Leverton.
This diversification has helped the firm weather the mining-revenue drop.
“The thought process was based on historical cycles,” she said. “Inevitably, a bear market would come back around.”
Bear Market: Some Crypto Firms Cut Jobs While Others Aim For Sustainable Growth
While crypto companies have been faced with major layoffs, things are nowhere as bad as the tech industry or other traditional sectors.
To put things into perspective, since November 2021, the total market capitalization of the digital asset industry has plummeted from it’s all-time high of $3 trillion to its current levels of approx. $1.27 trillion, thus showcasing a loss ratio of over 55%.
While this massive monetary downturn can be attributed to a range of factors, including the ongoing Russia-Ukraine war, rising inflation figures and worsening macroeconomic conditions have had a major impact on the crypto job landscape.
For example, earlier this month, Gemini, a cryptocurrency exchange helmed by the Winklevoss twins, announced that the bear market had forced them to lay off nearly 10% of its employees.
The brothers noted that as part of their first major headcount cut, Gemini had to shift its focus on products that are “critical” to the firm’s long-term vision and goals. In fact, the brothers conceded that the existing turbulence was likely to persist for a few months at the very least, adding:
There is no denying the fact that the crypto industry has grown from strength to strength over the last couple of years. However, the last six odd months have been anything but pleasant for the market.
“This is where we are now, in the contraction phase that is settling into a period of stasis — what our industry refers to as ‘crypto winter.’ […] This has all been further compounded by the current macroeconomic and geopolitical turmoil. We are not alone.”
How Bad Is The Situation Really?
In addition to Gemini, a number of other big-name firms have had to make serious cutbacks in recent months. For example, the second-largest cryptocurrency exchange in Latin America, Bitso, announced late last month that it was letting go of 80 of its employees due to worsening global economic conditions. At the time of the announcement, Bitso had over 700 full-time workers.
The firm’s staff overhaul is not only a means of tightening its purse strings but also as a way of restructuring Bitso’s day-to-day activities. That said, a representative for the exchange recently revealed that they still have few vacancies across niche strategic domains such as accounting, tax, fraud detection and others.
Buenbit, one of Argentina’s leading cryptocurrency investment platforms, had to take more drastic measures to put a stop to its financial bleeding. During the last week of May, the company laid off approximately 45% of its workforce, shrinking its active employee pool from about 180 to just 100 workers.
2TM, the parent company behind Mercado Bitcoin, also revealed that it was going to be laying off 12% of its 750-strong team as a result of “changes in the global financial landscape.” At press time, Mercado Bitcoin is by far the biggest crypto exchange in Latin America in terms of the total trading volume. As part of a statement regarding the move, a spokesperson for 2TM noted:
“The scenario requires adjustments that go beyond the reduction of operating expenses, making it necessary also to lay off part of our employees.”
Coinbase announced recently that it would slow down its rate of hiring and reassess its financial strategies so as to ensure the company’s continued success.
The firm even rescinded a lot of job offers that it had already issued, putting the visas of many international candidates in jeopardy. Not addressing the visa issue directly, Coinbase’s chief people officer L.J. Brock wrote in a blog recently:
“As these discussions have evolved, it’s become evident that we need to take more stringent measures to slow our headcount growth. Adapting quickly and acting now will help us to successfully navigate this macro environment and emerge even stronger, enabling further healthy growth and innovation.”
Crypto-friendly trading platform Robinhood fired 9% of its workforce in April, a decision that came at a time when the company’s stock offering had touched an all-time low. Lastly, one of the Middle East’s most prominent crypto trading ecosystems, Rain Financial, laid off over 12 employees earlier this month, citing the global financial downturn as a reason for the same.
A Repeat of 2018
The aforementioned job turmoil seems to have an eerie feel to it, one that mirrors the events of 2018 when the market was faced with widespread layoffs across the board.
At the time, crypto mining giant Bitmain got rid of a massive chunk of its employee base, with reports then suggesting that the company let go 1,700 of its 3,200 employees — including its entire Bitcoin Cash (BCH) development team, several engineers, media managers and more.
Prominent cryptocurrency exchange Huobi also carried out massive layoffs in 2018, with the company letting go of its “underachieving employees” while stressing that the remedial measures were necessary for “its core business” to sustain itself.
At the time, the company reportedly had a workforce of over a thousand employees.
Lastly, blockchain software technology firm ConsenSys was also forced to make significant cuts in 2018, with the company’s CEO Joseph Lubin penning a letter to his employees revealing that he would have to let go of some 600 employees in an effort to help the business stay afloat.
Not All Is Lost
Amid these unfavorable market conditions, there are still firms that have decided not to lay off their employees. For example, crypto exchange platform FTX announced that not only will it be retaining its existing employees but will also be hiring new personnel as the crypto winter marches on.
As part of a recent Twitter exchange, CEO Sam Bankman-Fried explained that his firm will continue to expand its operations because its growth blueprint has been well structured, unlike some other firms that experienced unfounded, unsustainable “hyper-growth” during last year’s bull run.
1) Zig Zag and hiring:— SBF (@SBF_FTX) June 6, 2022
why FTX is going to keep growing as others cut jobs
Criticizing “hyper-growth companies,” Bankman-Fried said that hiring more staff quickly doesn’t necessarily lead to a substantial increase in productivity since rapid expansion, more often than not, makes it more difficult for everyone to stay on the same page. “Sometimes, the more you hire, the less you get done,” he said.
Even though FTX had slowed down its hiring earlier on in the year, the move, he noted, was not due to a lack of funds but rather a means of ensuring that new team members had enough time to adjust to their new roles and professional surroundings.
Some crypto recruiters noted that while the digital asset industry has indeed witnessed layoffs, its rate of hiring has remained spectacularly high, especially when compared to the traditional tech space. To this point, a number of Silicon Valley giants including Twitter, Uber and Amazon have announced major job cuts recently.
Netflix also terminated the roles of 150 employees after posting historically poor growth figures, while Facebook’s parent company Meta noted that it was instating a hiring freeze for any mid-to-senior-level positions after failing to meet revenue targets.
Neil Dundon, founder of employment agency Crypto Recruit, said that things have not slowed down when it comes to hiring within the digital asset industry. “We have a team based globally across the U.S., Asia/Pacific and European regions and demand is equally as high across the region,” he pointed out in a recent interview with Cointelegraph.
Similarly, Kevin Gibson, founder of Proof of Search, told Cointelegraph that the lay-offs taking place across the tech sector have had little to no impact on his crypto industry clients so far, adding:
“I’ve only heard of two companies letting people go. This may change in the next month, but any slack will immediately be taken up by well-funded quality projects. As a candidate, you won’t notice any difference. if you do lose your job, you will also have multiple offers pretty quickly.”
Therefore, as the ongoing downturn continues to affect the global economy in a big way, it will be interesting to see how companies operating within this space are able to stave off bearish pressure and survive the ongoing financial onslaught.
Crypto.com, BlockFi To Cut Over 400 Jobs Amid Market Rout
The companies are the latest crypto firms to announce job reductions, joining Gemini and Rain Financial, among others.
Crypto exchange Crypto.com and lending platform BlockFi plan to cut a total of more than 400 jobs, joining an expanding list of crypto companies looking to reduce headcount.
* Crypto.com will cut almost 5% of its workforce, or about 260 employees, CEO Kris Marszalek said in a tweet over the weekend.
* BlockFi also said it would trim its headcount in a tweet thread on Monday. CEO Zac Prince said “roughly 20%” of its workforce will go, which would equate to around 170 people.
* The cryptocurrency market has been falling this year, having touched a peak value of about $3 trillion in November. On Monday it slumped more than 12% to slide below $1 trillion. Bitcoin has declined for nearly 12 straight weeks, marking one of the asset’s biggest slides in its lifetime.
* The firms join other major crypto companies laying off employees amid a turbulent market downturn.
* Winklevoss twins-led exchange Gemini cut about 10% of its workforce and Middle Eastern crypto-exchange Rain Financial – among other companies – said it was cutting dozens of jobs. Coinbase (COIN) said it would be rescinding some job offers and would pause hiring to cut costs.
* “Our approach is to stay focused on executing against our roadmap and optimizing for profitability as we do so … That means making difficult and necessary decisions to ensure continued and sustainable growth for the long term by making targeted reductions of approximately 260, or 5%, of our corporate workforce,” Marszalek said in a tweet thread.
Lot’s of questions and speculation flying around regarding what https://t.co/pFc4PzqqHR is doing during the market downturn. My thoughts below ????— Kris | Crypto.com (@kris) June 11, 2022
Coinbase To Lay Off 18% of Staff Amid Crypto Meltdown
Biggest U.S. cryptocurrency exchange has struggled to keep users this year; meanwhile, crypto lender Celsius Network hires restructuring attorneys.
Further waves of reckoning swept through the cryptocurrency industry Tuesday, with exchange company Coinbase Global Inc. saying it would cut almost a fifth of its staff and crypto lender Celsius Network LLC hiring a law firm to examine restructuring options.
Coinbase, one of the signal growth companies of the crypto boom, said it was slashing its workforce by 1,100 employees, or about 18% of its staff, because the company had grown too quickly and a potential recession “could lead to another crypto winter.”
In a letter to employees, Chief Executive Brian Armstrong said “our employee costs are too high to effectively manage this uncertain market.”
“We appear to be entering a recession after a 10+ year economic boom,” Mr. Armstrong wrote. “A recession could lead to another crypto winter, and could last for an extended period. In past crypto winters, trading revenue (our largest revenue source) has declined significantly.”
Meanwhile, Celsius, one of the largest crypto lenders, tapped attorneys from law firm Akin Gump Strauss Hauer & Feld LLP to advise on solutions for its mounting financial problems, people familiar with the matter said.
Celsius had told users on Sunday night that it was pausing all withdrawals, swaps and transfers between accounts because of extreme market conditions, adding more turbulence to cryptocurrency prices.
A spokeswoman for Akin Gump had no immediate comment. Celsius executives didn’t immediately respond to requests for comment.
The destruction in crypto markets has been broad and deep, with roughly $2 trillion of value having been erased across numerous cryptocurrencies since November, when bitcoin—the most mainstream of them—hit an all-time high of $67,802.30.
Investors have continued to unload assets viewed as risky, like cryptocurrencies and technology stocks, while the Federal Reserve tries to tame the highest inflation in the U.S. in decades. The S&P 500 stock index entered a bear market this week as investors expect the Fed to further raise interest rates.
As of 5 p.m. ET Tuesday, bitcoin traded at $21,991.89, down 5.4% for the day and 68% below its all-time high. Dogecoin, a cryptocurrency that was started as a joke but became established enough to be mentioned by Elon Musk on “Saturday Night Live,” peaked at 67.4 cents in May of 2021 and has crashed by 92% since.
Coinbase, the biggest cryptocurrency exchange in the U.S., has struggled to hang on to users this year as the frenzy in digital assets cooled and markets have been rocky. In May, Coinbase said it lost hundreds of millions of dollars in the first quarter as its trading fees dropped sharply.
The number of Coinbase’s transacting users also slid, and the company said it expected trading volumes and users to drop again in the second quarter.
Since the earnings report, things have gotten worse for cryptocurrency prices, Coinbase’s stock and markets in general.
Coinbase’s IPO last year was deemed a watershed moment for the crypto industry, which had started a decade before as an experiment in digital money. Its debut was hailed by some as similar to when other sector-defining companies went public, such as Netscape in the 1990s.
When Coinbase—which says it is “remote-first” and doesn’t maintain a headquarters–went public, the first trade of its stock was at $381, and shares rose as high as $429.54. On Wednesday, it closed at $51.58.
Last week, Mr. Armstrong tweeted criticism of a petition by Coinbase employees to remove some executives, not including Mr. Armstrong, from the company because “the executive team has recently been making decisions that are not in the best interests of the Company, its employees, and its shareholders.”
In a June 10 Twitter thread that spanned 16 tweets, Mr. Armstrong said, “if you have no confidence in the execs or CEO of a company then why are you working at that company? Quit and find a company to work at that you believe in!”
Coinbase said it expects to have 5,000 staffers following the layoffs and that laid-off employees will get at least 14 weeks of severance pay.
Other crypto-focused companies have recently announced layoffs as crypto prices have plunged. BlockFi, a crypto trading and lending platform, said Monday it would reduce its head count by 20% as it said “the macroeconomic environment has shifted dramatically.”
The CEO of Crypto.com, the company that recently put its name on the Los Angeles Lakers’ arena and ran a Super Bowl ad featuring LeBron James, said his firm would make “targeted reductions” of about 5% of its workforce, or 260 jobs. Earlier in June, crypto exchange Gemini Trust Co. cut 10% of its staff, citing the effects of the market downturn.
The layoffs come after a hiring boom as crypto grew in value. Crypto firms’ hiring had doubled from November to April, according to data collected by ManpowerGroup.
Sweeping Layoffs, Hiring And Firing As Crypto Prices Take A Massive Downturn
Brutal economic conditions coupled with dramatically falling crypto prices have led to massive layoffs within the blockchain industry.
Many in the crypto world have been glued to their screens with eyes dead set on financial conditions this week. That isn’t the case for everyone though, as thousands are suddenly experiencing thewoes of sudden unemployment.
Words of encouragement and sympathy also poured out across Twitter and LinkedIn consoling individuals released from their responsibilities. Some expressed frustration, confusion and anger while others expressed gratitude, renewed vision and reflections.
My heart is with those recently laid off. I too have been one of the lucky ones to be spared by massive layoffs on days where friends have been let go. This privileged situation has its own anxiety, displacement and upheaval. Sorry you’re going through this moment.— Matt Murray (@vintageneon) June 16, 2022
As recently laid-off talent takes to social media to let the world know, multiple companies have stood up to offer job interviews to those in distress.
Binance has been vocal across social media, offering two thousand jobs to replace the thousands that were recently dissolved. The company’s CEO and president Changpeng Zhao, or CZ, provided additional support to the freshly made available talent pool.
It was not easy saying no to Super bowl ads, stadium naming rights, large sponsor deals a few months ago, but we did.— CZ Binance (@cz_binance) June 15, 2022
Today, we are hiring for 2000 open positions for #Binance. pic.twitter.com/n24nrUik8O
CZ went on to say, “While lots of projects and exchanges are going to struggle through the bear market, many will come back stronger than before. Those that fail honestly, will start new projects and bring critical learnings from this experience. This is how an industry grow[s].”
Ripple (XRP) also offered opportunities via a tweet sent from their CEO, Brad Garlinghouse.
Ripple is hiring for hundreds of roles around the globe – both in person and remote. Fair warning – we have a “no assholes” policy here. If that’s the kind of culture you’re looking for, apply here https://t.co/49kPgUOMpR https://t.co/IZl4wskYFp— Brad Garlinghouse (@bgarlinghouse) June 16, 2022
Crypto exchange Kraken stepped in offering somewhat conditional employment opportunities. A thirty-two-page manifesto outlining the company’s culture was released for interested parties looking to join the company.
Several other companies sent out tweets offering fresh employment opportunities as well.
Unfortunately several crypto exchanges announced big layoffs recently:— CryptoCareers | Hiring Web3 Devs (@_cryptocareers) June 14, 2022
– @coinbase 18%
– @Gemini 10%
– @cryptocom 5%
– @BlockFi 20%
Despite all this several of our hiring partners are still looking for devs: Rust, Solidity, React, NodeJS…
✉️ DMs are open! #hiring
Rob Behnke, CEO of Halborn Security, tweeted with fully remote opportunities in marketing, sales, security engineering and HR.
In recent days, token prices have taken a dive, investment firms and exchanges are facing insolvency, and Bitcoin’s support at $23,000 continues to waiver with some even eyeing $8,000 as the incoming low.
Many portfolios are deep red as scores of investors look to hedge their tax losses as a means to aid in numbing their financial pain.
Criticism from Hester Peirce roasted the SEC, while Mark Cuban offered some words of wisdom, “Like [Warren] Buffett says, ‘When the tide goes out, you get to see who is swimming naked.’” Job seekers, investors and crypto enthusiasts can only wait with baited breath for what will occur next.
Mideast’s Largest Crypto Platform Trims Staff Amid Market Tumult
BitOasis, the Middle East’s largest local crypto platform, reduced its headcount by about 7% this past week, the latest sign of stress at some of the region’s biggest digital-asset exchanges.
“Earlier this week, nine employees were made redundant across offices in Dubai, Abu Dhabi and Amman,” Chief Executive Officer Ola Doudin said in a message to Bloomberg. “As the market slows down we ensure to stay focused on execution and growing our footprint across the region.”
Bybit To Reduce Workforce As Crypto Slump Drives Cost-Cutting Measures
The crypto exchange is looking to remove overlapping functions and build smaller, more agile teams, it told CoinDesk.
Cryptocurrency exchange Bybit is planning to reduce its headcount after rising inflation and lower consumer spending drove crypto into a bear market and prompted firms across the industry to seek ways of cutting costs.
Job cuts might amount to about 30% of the workforce, according to crypto journalist Colin Wu, who cited unidentified sources. The Dubai-based firm has a headcount of around 2,000.
Bybit joins fellow crypto firms in cutting jobs. Coinbase (COIN) said last week it was laying off 1,100 employees –around 18% of its workforce – while crypto lender BlockFi said it would reduce its headcount by more than 170 – roughly 20%.
Crypto.com said it would cut about 5% of its workforce, amounting to around 260 employees.
“We are exploring a way to remove overlapping functions and build smaller but more agile teams to improve our efficiency,” a Bybit spokesperson told CoinDesk. “Starting from this week, some of the functions and roles will be reviewed to ensure we stay focused and agile.”
According to a copy of an internal letter posted by Wu, Bybit CEO Ben Zhou said the firm “grew so fast” during the most recent crypto bull market, and “grew too comfortable.”
“Our organization size grew exponentially but the overall business growth did not grow in the same way,” Zhou said.
European Crypto Exchange Bitpanda Cuts Staff By Hundreds
Bitpanda announced it is reducing its employee count to 730, down from about 1,000.
Austria-based crypto trading platform Bitpanda is slashing its headcount to ensure sustainability, the company said in a Friday blog post.
* Bitpanda’s founders said the firm needs to let employees go as it scales down due to market conditions.
* The company said it is aiming for a target headcount of 730. It has just over 1,000 employees, according to LinkedIn.
* “We reached a point where more people joining didn’t make us more effective, but created coordination overheads instead, particularly in this new market reality,” Bitpanda wrote. “Looking back now, we realise that our hiring speed was not sustainable. That was a mistake.”
* In addition, recent offers will be retracted, and employees have been notified.
* Bitpanda’s layoffs come as crypto platforms and tech companies alike slash headcount in a bid to survive the market downturn and a period of rising rates.
* “We acknowledge the responsibility we have for our employees and their families,” Bitpanda said in a statement sent to CoinDesk. ”This is why it is a top priority for us to support them to smoothly transition to the next step in their career.”
Bitpanda Announces Layoffs Citing No Compromise On Product Quality
Witnessing the crypto crashes over the past several weeks from a front-row seat, Bitpanda made the “tough decision” of cutting down its employee headcount to roughly 730 people.
Austrian crypto and stock trading platform Bitpanda joins the growing list of companies to announce a mass layoff as it aims to “get out of it financially healthy” amid an unforgiving bear market.
Over the past several weeks, the bear market resulted in numerous catastrophic outcomes for many ecosystems such as TerraUSD Classic (USTC) and Abracadabra’s Magic Internet Money (MIM) de-pegging fiasco.
Witnessing the crashes from a front-row seat, Bitpanda made the “tough decision” of cutting down its employee headcount to roughly 730 people.
While the exact number of employees intimated to stop working for Bitpanda remains undisclosed, data from LinkedIn indicates that the company is in the process of laying off approximately 277 full-time and part-time employees.
In the announcement, named “The Way Forward,” Bitpanda supported the move to cut down employees by highlighting the need to be “robustly well-capitalized” amid uncertain market conditions, stating:
* “It is a tough, but necessary decision and we are confident that the new organizational design will help us be more focused, effective and stronger as a company.”
The company is offering its ex-employees support packages which include mental health support, references and an employee assistance program (EAP). Speaking about its hypergrowth phase, a timeline when the crypto market breached the $2 trillion market capitalization, Bitpanda revealed problems with internal processes and infrastructure to successfully onboard new joiners:
* “We reached a point where more people joining didn’t make us more effective, but created coordination overheads instead, particularly in this new market reality. Looking back now, we realize that our hiring speed was not sustainable. That was a mistake.”
Bitpanda has not yet responded to Cointelegraph’s request for comment.
Joining the mass reorganization drive to better suit the bear market, American crypto trading firm Coinbase announced the closure of its Coinbase Pro services.
Australian Crypto Exchange Banxa Lays Off 70
The company cited the “crypto winter” for the move that reduced its staff by 30%.
Australian crypto exchange Banxa has cut more than 70 jobs in anticipation of a steep market downturn, the Australian Financial Review reported Monday.
* The move represents 30% of the Melbourne-based company’s workforce, AFR said. The company’s headcount peaked at more than 230 employees last year when the crypto market hit record highs.
* “Banxa must take decisive actions to reduce costs now, or else our company won’t be able to succeed over the long run,” CEO Holger Arians said in a letter to employees, according to AFR. The decision was conveyed to staff last Wednesday, with Arians telling employees that the company grew too quickly and that extensive redundancy would occur as market conditions become worse.
* The affected employees include European managing director Jan Lorenc.
* The company, which was founded in 2014, has been publicly traded on the Toronto Stock Exchange’s early-stage TSX Venture Exchange since January 2021. The shares have fallen 74% in the past year amid a steep decline in crypto and equity markets. They closed Friday at C$1.04, giving the company a market value of C$46.5 million ($36 million).
* Banxa’s joins other crypto companies that are reducing headcount to save costs as bitcoin prices fall, causing a decline in customer sentiment and trading volumes. In the past month, exchange Coinbase cut over 20% of its workforce, and Crypto.com, Gemini and lending platform BlockFi have also announced layoffs.
Huobi Global Could Cut Over 30% of Workforce As China Crackdown Leads To Fall In Revenue
China’s decision to ban crypto trading last year caused Huobi a sharp drop in revenue.
Cryptocurrency exchange Huobi Global could cut over 30% of its workforce after the removal of Chinese users created a sharp drop in revenue, according to China-based crypto journalist Colin Wu.
* Huobi is expected to cut at least 300 jobs from its workforce of more than 1,000 employees. It began to gradually stop serving customers in China last September, with all access being revoked on Dec. 31 in the wake of China’s ban on crypto trading.
* “Due to the current market environment, Huobi Global is in the process of reviewing both its hiring policies and its current manpower, with the goal of re-aligning them to its operational needs,” a company spokesperson told CoinDesk. “Further to such review, layoffs are a possibility.”
EXCLUSIVE: Cryptocurrency exchange Huobi will start layoffs, which may exceed 30%. The main reason is the sharp drop in revenue after the removal of all Chinese users. Previously, Bybit also announced a layoff plan. pic.twitter.com/jbRG2Aew5G— Wu Blockchain (@WuBlockchain) June 28, 2022
* The Seychelles-based Huobi Global is one of the most prominent crypto exchanges with daily trade volume regularly exceeding $1.2 billion, according to CoinGecko.
* Last week, rival exchange Bybit announced a similar cost-cutting measure and laid off 30% of its staff in light of the recent market downturn.
* This followed Coinbase’s (COIN) decision to reduce its headcount by over 1,100 employees. BlockFi and Crypto.com also laid off a total of 400 employees.
* The cryptocurrency market has slumped from an aggregated $2.9 trillion market cap to $938 billion over the past seven months, with bitcoin (BTC) now trading at $20,800 after hitting an all-time high of $68,980 in November.
* Huobi’s native exchange token (HT) was down 1.16% over the past 24-hours at $5.30.
* Huobi did not respond to CoinDesk’s request for comment at press time.
Cosmos-Builder Ignite Cuts Headcount by More Than 50%, Ex-Employees Say
The reductions come amid a crypto market crash, and after the return of Ignite’s controversial ex-CEO.
Ignite, the company that originally founded the Cosmos blockchain ecosystem, has parted with more than half its employees this week, two ex-employees and a source close to the company told CoinDesk.
The news came after Ignite CEO Peng Zhong announced on Friday he would be leaving the company. According to one of CoinDesk’s sources, Zhong was also joined by other top executives at the firm. Against the backdrop of a contentious re-organization, the high-profile exits at Ignite place the firm’s future in question.
Ignite laid off some employees, and others volunteered to leave the company in return for severance packages. The firm joins other crypto companies hit hard by the sector’s recent collapse, including BlockFi, Coinbase (COIN) and Crypto.com. But according to CoinDesk’s sources, Ignite’s workforce cuts stemmed not only from recent market conditions but internal factors.
According to the two ex-employees who spoke to CoinDesk on the condition of anonymity, the potential for cuts was first announced by former Ignite CEO Jae Kwon when he returned to the company in May.
Kwon, one of Cosmos’ original creators, founded Ignite (then called Tendermint) and its parent company, All In Bits, Inc., in 2014. Kwon stepped down as Tendermint’s CEO in 2020 after a widely publicized dispute with some of its employees, but he retained a seat on the All In Bits board.
In May, CoinDesk reported that Kwon would be returning to the company as the CEO of New Tendermint, an Ignite spin-off focused on some of Kwon’s side projects.
According to CoinDesk’s sources, when Kwon announced his return at a company all-hands in May, he said severance packages would be offered to some employees.
According to one of the ex-Ignite employees, details about the new organizational structure between Ignite and New Tendermint remained vague for several weeks after they were announced.
Employees were invited to apply to work at New Tendermint, Kwon’s new venture, said the ex-employee. Those who did not apply were told they would be invited to join a reformulated version of Ignite, or a new initiative called Cosmos Cash. According to the ex-employee, Kwon clarified that not all Ignite employees would make the cut.
The crypto crash in June forced Kwon to slash numbers further than originally anticipated, the person said.
CoinDesk has reached out to Kwon for comment but has not heard back.
CoinDesk has reviewed a spreadsheet listing over 50 ex-Ignite employees from multiple departments who were laid off or voluntarily accepted severance packages. According to CoinDesk sources, the list was circulated to other Cosmos-based projects who might be looking for workers, and the number of people who have left or are leaving the company could total over 100.
Before these departures, Ignite’s headcount was around 140.
A Re-Brand, A Re-Org And A Re-Structuring
In February, Ignite rebranded from its original name, Tendermint. Then-CEO Peng Zhong told CoinDesk at the time the rebranding was meant to signify a shift in strategy for the firm, which had historically focused on building backend infrastructure for the Cosmos ecosystem.
The Cosmos ecosystem is a community of inter-connected blockchains that can easily send assets back and forth. It made headlines this week with the announcement that dYdX, a leading crypto exchange platform, will be leaving Ethereum in favor of its own Cosmos-based blockchain.
Today, most of Cosmos’ core infrastructure is maintained by a broad community of teams and companies other than Ignite. With the rebrand from Tendermint, Zhong said Ignite would place the bulk of its focus on Emeris – the firm’s Cosmos-based crypto investment hub.
Ignite announced Friday that the development of Emeris was “On Hold.”
Crypto Lender Celsius Cuts 150 Jobs Amid Restructuring
Withdrawals are still paused and the company has hired restructuring experts as it faces a financial crisis.
American-Israeli crypto lender Celsius laid off some 150 employees as it battles a financial crisis that saw it halt customer withdrawals last month, Calcalist reported over the weekend.
The firm has about 650 staff members listed on LinkedIn, including executives, meaning 23% of the company was affected.
The layoffs come amid uncertainty for the company as it faces possible insolvency. In June it paused withdrawals citing “extreme market conditions” and has since hired restructuring specialists. The company said it is exploring options to “preserve and protect assets” following its mid-June turmoil.
Goldman Sachs (GS) is said to be leading a $2 billion raise from investors to purchase Celsius’s distressed assets. Crypto exchange FTX, however, is said to have passed on a deal to purchase the lender after examining its finances.
Celsius joins a growing of crypto firms letting go of staff amid bearish market conditions. Coinbase (COIN) laid off over 1,100 employees in June, with exchanges Bybit, Huobi, Banxa and several others letting go of staff in the past month.
Prices of Celsius’s CEL tokens were up 15% in the past 24 hours, CoinGecko data show.
Crypto Exchange Bullish.com Reportedly Cuts About 10% of Workforce
The company last week extended the deadline to complete its SPAC merger until the end of 2022.
Cayman Islands-based cryptocurrency exchange Bullish.com has joined a long list of crypto companies pursuing layoffs in an effort to weather the massive market downturn.
* According to a report in The Block, Bullish has laid off less than 30 of its workers, with a check of LinkedIn showing the company employs about 270. Bullish – which serves institutional clients – confirmed the job cuts to The Block, while noting it continues to actively hire for a number of roles.
* Gemini, Coinbase (COIN) and Crypto.com are among a number of exchanges which have announced job cuts in recent weeks.
* Bullish.com launched last year as a subsidiary of Block.one, the software company behind open-source blockchain platform EOSIO. Initial funding from Block.one and a number of prominent investors summed to a vast $10 billion.
* The exchange was to be taken public via a special purpose acquisition company (SPAC) agreement with Far Peak Acquisition (FPAC). Thanks to general market turbulence, particularly in the SPAC and crypto arenas, that deal has faced delays, with the two parties last week agreeing to extend the termination date from July 8 to Dec. 31.
* Earlier on Tuesday, crypto exchange eToro announced the termination of its planned SPAC deal with FinTech Acquisition Corp. V.
Compass Mining Cuts 15% of Staff, Lowers Executive Compensation
The bitcoin mining company said it’s reassessing its priorities after growing too quickly.
Compass Mining has let go of 15% of its employees, and has cut executive compensation to ride out the crypto downturn.
* Compass also said it grew too quickly, and needed to readdress its strategy moving forward.
* “Given recent market downturn and anticipated future market conditions, we had to take a hard look at our spend and recalibrate for the future of the business,” co-founders and interim CEOs Thomas Heller and Paul Gosker said in a statement Thursday.
* The bitcoin (BTC) mining hosting company had just over 80 employees, according to its LinkedIn profile as of late Thursday.
* In June, Compass’s CEO and chief financial officer resigned amid “setbacks and disappointments” at the company.
OpenSea Lays Off Roughly 20% of Its Staff
CEO Devin Finzer cited an “unprecedented combination of crypto winter and broad macroeconomic instability.”
NFT (non-fungible token) marketplace OpenSea has laid off about 20% of its staff, CEO Devin Finzer announced in a tweet on Thursday.
* “The reality is that we have entered an unprecedented combination of crypto winter and broad macroeconomic instability, and we need to prepare the company for the possibility of a prolonged downturn,” Finzer wrote in a note to staff.
* Finzer said the layoffs put the company in position to weather up to five years of depressed conditions at OpenSea’s current volume and not have to have further layoffs.
* “With the hard (but important) changes we made today, we’re in an even better position to capture what will soon become the largest market on the planet,” Finzer added.
* OpenSea joins a number of crypto firms, many of them exchanges, that have laid off staff or paused hiring in recent months. Gemini, Coinbase, Crypto.com and Bullish.com have all announced layoffs recently.
Gemini Cuts More Staff As Many Crypto Prices Increase
A source close to the crypto exchange reportedly said there were 68 fewer employees on the company’s Slack channel as of Monday, suggesting Gemini had cut roughly 7% of its staff.
Cameron and Tyler Winklevoss’ Gemini has reportedly laid off additional staff more than a month after reports suggested the cryptocurrency exchange cut 10% of its employees.
In a Monday report from TechCrunch, the news outlet said that a source close to Gemini reported 68 fewer employees on the company’s Slack channel, suggesting the crypto exchange had cut roughly 7% of its more than 1,000 staff. The unnamed source claimed that Gemini continued laying off employees as part of “extreme cost-cutting.”
The Winklevoss brothers’ Gemini Trust reportedly cut 10% of its employees amid the bear market in June as the price of many major cryptocurrencies fell by double-digit percentages. However, at the time of publication, Bitcoin (BTC) and Ether (ETH) prices have risen by more than 4% and 10% in the last 24 hours, respectively.
Amid the crypto market volatility and other major exchanges including Coinbase and Crypto.com announcing similar staff cuts in June, the Winklevoss brothers were reportedly on tour with their band, Mars Junction:
The United States Commodity Futures Trading Commission filed suit against Gemini in June, alleging the exchange made false or misleading statements in 2017 during in-person meetings and in official documents.
The statements were part of Gemini’s self-certification of a BTC futures contract, facilitating the CFTC’s determination to see if the investment vehicle could be susceptible to manipulation.
Oracle Cuts Workers In US Customer Experience Unit
* Marketing, Customer Analytics Workers Among Those Let Go
* Jobs Eliminated While Focus Turns To Health With Cerner Deal
Oracle Corp. cut jobs in marketing and the US customer experience division, signaling a pullback in customer analytics and advertising services.
Some workers were told Monday that their positions had been eliminated, according to four people with direct knowledge of the matter.
Junior sales employees as well as a division sales director were among those let go, according to one former worker who lost their job and asked not to be named to avoid professional repercussions.
Rumors of pending cuts had swirled through the division in recent weeks, but management said the positions were safe, one former employee said.
The customer experience division provides analytics and advertising services. It has long lagged behind the growth of the rest of the Austin, Texas-based software company.
During an event last year, Executive Vice President Douglas Kehring said the unit had “historically been probably a little more disappointing than it should have been.”
The company “decided to reorganize” the customer experience group “and move on,” a former senior manager of sales engineering, whose position was cut, wrote on LinkedIn. In a separate post, another fired manager cited the restructuring for the job reductions.
Some marketing positions were also cut, according to LinkedIn posts by a former senior manager and group vice president.
The job reductions come as Oracle looks to health care to spur the company’s effort in the competitive market for cloud technology.
Earlier this year, Oracle completed a $28.3 billion purchase of digital medical records provider Cerner Corp., seeking customers in an industry that has been comparatively slow to adopt cloud database technology.
Oracle didn’t respond to requests for comment. The extent of the job cuts that began Monday couldn’t immediately be determined.
The shares declined less than 1% to close at $77.44 Monday in New York, and are down 11% this year.
Robinhood Lays Off 23% of Staff As Retail Investors Fade From Platform
The job cuts mark the second round of layoffs for the online brokerage, which exploded in popularity during the Covid-19 pandemic.
Robinhood Markets Inc. is slashing about 23% of its full-time staff as the flashy online brokerage continues to reel from a sharp slowdown in customer trading activity.
The job cuts mark the second round of layoffs this year at Robinhood, which in April reduced its staff by about 9%. Together, the two rounds have cut more than 1,000 jobs from the company.
The layoffs come alongside a broader company reorganization, Vlad Tenev, Robinhood’s chief executive, said in a message posted to the company’s blog.
In the statement, Mr. Tenev said the previous round of layoffs in April “did not go far enough” in helping the company cut costs.
“Last year, we staffed many of our operations functions under the assumption that the heightened retail engagement we had been seeing with the stock and crypto markets in the Covid era would persist into 2022,” Mr. Tenev said in the message.
“In this new environment, we are operating with more staffing than appropriate. As CEO, I approved and took responsibility for our ambitious staffing trajectory—this is on me.”
Robinhood also moved up the release of its second-quarter results a day earlier than scheduled, reporting its monthly active users tumbled to 14 million, down 34% from a year earlier. Revenue fell 44% to $318 million.
Launched less than a decade ago, Robinhood ushered in a free-stock trading phenomenon during the Covid-19 pandemic, thanks to its easy-to-use, mobile-first online brokerage platform.
By the second quarter of last year—Robinhood’s best, according to public filings—the company boasted more than 21 million active users, who flocked to the app to trade flashy meme stocks, options and cryptocurrencies.
But the pandemic-darling has seen its fortunes unwind this year as markets have tumbled and customers are no longer stuck at home like they were during the Covid-19 pandemic. Revenue tied to customers’ trading activity dropped 55% in the latest quarter to $202 million.
Robinhood’s stock price plunged this year and finished Tuesday at $9.23, down 76% from its initial public offering price last year of $38 a share. Its stock fell 1.6% in recent after-hours trading.
Robinhood scaled up staffing quickly during the Covid-19 pandemic to meet the surge in demand for its services. On the company’s earnings call in April, Mr. Tenev said the company grew its head count to nearly 3,900 in the first quarter of this year from roughly 700 at the end of 2019. Tuesday’s reduction will bring the head count to about 2,600.
In his blog post, Mr. Tenev said all employees would receive an email and a Slack message with their employment status immediately following Tuesday’s companywide meeting where the layoffs were announced. Employees who were laid off will be able to remain employed through Oct. 1, Mr. Tenev said.
“The reality is that we over-hired, in particular in some of our support functions,” Mr. Tenev said later on the call with reporters. He noted that employees in support, operations, marketing and program management would be most acutely affected.
A number of technology companies have laid off employees in recent months as they grapple with a slowdown in growth and the threat of a looming recession. Twitter Inc., Netflix Inc. and Tesla Inc. are among those that have made staff cuts.
Within the brokerage landscape, Robinhood has found itself more deeply affected by the current market environment. Compared with larger, entrenched players in the industry, Robinhood’s users tend to be younger and have less money in their brokerage accounts.
Jason Warnick, Robinhood’s chief financial officer, said Robinhood customers tend to invest in growth stocks and cryptocurrencies. Both categories were hammered by a downturn in markets this year.
In addition to slowing growth, Robinhood has found itself under the watchful eye of regulators. The New York State Department of Financial Services said Tuesday that it imposed a $30 million fine on Robinhood’s cryptocurrency trading unit for alleged violations of anti-money-laundering and cybersecurity regulations.
The company, meanwhile, has encountered questions about the future viability of part of its business model, after Securities and Exchange Commission Chairman Gary Gensler earlier this year outlined a revamp of trading rules that could threaten one of the key ways Robinhood makes money.
As its business has struggled this year, Robinhood has increasingly been considered a takeover target by some market watchers, especially in the highly competitive brokerage industry. In May, one of the biggest names in cryptocurrency, Sam Bankman-Fried, unveiled a roughly $648 million investment in Robinhood in exchange for 7.6% of the company’s Class A shares.
Any outside investor, including Mr. Bankman-Fried, would face an uphill battle in mounting an aggressive takeover bid for Robinhood, due to a dual-class share structure that gives the majority of voting control to Mr. Tenev and Baiju Bhatt, Robinhood’s other co-founder.
Mr. Warnick reiterated on Tuesday’s media call that Robinhood intends to continue as a stand-alone, independent company.
“We’ve got an incredibly strong balance sheet with $6 billion in cash and we’ve got a lot of momentum on the product side,” he said. “To the contrary of being acquired, we actually think that we should be looking more aggressively at opportunities to acquire other companies that would help speed our innovation.”
Mr. Warnick added that Robinhood plans to roll out tax-advantaged retirement accounts later this year, following its earlier launch of other products including a new debit card.
Some former employees, customers and analysts, however, have criticized the brokerage for being too slow to unveil new products that could diversify its revenue stream.
Walmart Lays Off Hundreds of Corporate Workers
Retailer is restructuring headquarters operations after warning of profit troubles.
Walmart Inc. is cutting hundreds of corporate roles in a restructuring effort, according to people familiar with the matter, a week after the retail giant warned of falling profits.
The retailer began notifying employees in its Bentonville, Ark., headquarters and other corporate offices of the restructuring, which affects various departments including merchandising, global technology and real-estate teams, the people said. Around 200 jobs in total are being cut, said one of these people.
A Walmart spokeswoman confirmed that there were roles being eliminated as the company updated its structure, but said that the company was also investing in other areas and creating some new roles.
Last week, Walmart warned that its profit would decline in the current quarter and fiscal year because it was having to mark down apparel and other merchandise that has piled up in its stores. The retailer said higher prices for food and fuel were causing U.S. shoppers to pull back on other categories that are more profitable for it.
Walmart was one of several retailers that was caught off guard this spring as shoppers shifted their spending away from products that have been in high demand throughout much of the pandemic. In addition, some products arrived late due to supply-chain snarls, causing oversupply as shopper interest waned.
Target Corp. in June issued a profit warning after it reported quarterly results that, like Walmart, showed a surge in inventory levels. Last week, Best Buy Co. cut its sales and profit goals, saying consumers had pulled back on electronics.
Walmart is the largest private employer in the U.S. and while much of its workers are hourly staff, it has thousands of people in corporate roles. Walmart employed 2.3 million worldwide, including 1.7 million in the U.S., as of Jan. 31.
While the overall U.S. job market has been strong, a handful of other major employers are pulling back on hiring or cutting some jobs. Ford Motor Co. is preparing to cut thousands of white-collar workers, while technology giants such as Microsoft Corp. and Facebook parent Meta Platforms Inc. have pulled back.
Investors will get another update on the health of the U.S. job market on Friday when the government releases data for July. Economists surveyed by The Wall Street Journal think Friday’s jobs report will show that they added more than 250,000 in July, compared with 372,000 in June.
Thiel’s Palantir Boosts Hiring While Others Are Cutting Jobs
* Headcount Estimated To Increase About 25% By Year’s End
* Company To Reach Roughly 3,670 On Staff, Up From 2,920 In 2021
Palantir Technologies Inc. is significantly accelerating its pace of hiring this year to help meet ambitious sales goals, defying convention when many other technology companies are freezing headcount or cutting jobs.
The move reflects the ethos of the company’s chairman and co-founder, Peter Thiel, who built a fortune by going against popular opinion in Silicon Valley. Palantir, which sells data analysis software to governments and companies, is on track to increase headcount about 25% by the end of the year, Lisa Gordon, a spokeswoman for the company, told Bloomberg.
Palantir has already hired or extended offers to 1,100 new employees so far this year and expects to add another 300 before the end of the year, Gordon said. Palantir’s headcount will soon reach around 3,670, up from 2,920 at the end of 2021, she said.
The conventional response to economic uncertainty is to slow down or cut back. That’s what many companies are doing now. Alphabet Inc., Apple Inc. and Meta Platforms Inc. have taken steps to cool recruiting. Amazon.com Inc. shed about 100,000 jobs through attrition. Microsoft Corp., Netflix Inc., Oracle Corp. and many others eliminated positions.
Palantir hasn’t been immune to market trends that have dragged down tech stocks. Its shares have declined 38% this year. The stock jumped as much as 2% on the hiring news Friday, erasing an earlier loss. The company reports quarterly financial results on Monday.
Since its founding nearly two decades ago, Palantir has worn contrarianism like a badge of honor.
It pursued work for governments when few tech companies would do so and for a long time, refused to hire salespeople. (Alex Karp, the co-founder and chief executive officer, once said the only way he’d hire a sales team was if investors forced him or if he was “hit by a bus.”) Just before Palantir went public in 2020, Karp used the event as an opportunity to distance his company from Silicon Valley, both philosophically and physically, by moving the headquarters to Denver.
Karp’s view on salespeople has evolved. The company made it a top priority in recent years to build a sales team as part of a larger goal to win government and commercial customers.
Shyam Sankar, the chief operating officer, told Bloomberg in February that Palantir would add at least 175 people in sales this year. Palantir also works with International Business Machines Corp., Hyundai Heavy Industries Group and others to help sell its software to companies.
Of the 1,400 new hires planned for 2022, a significant portion outside of the sales department will be software engineers, according to Bonnie McLindon, the global head of recruiting for Palantir. Competition for top engineering talent remains fierce, but hiring them has gotten somewhat easier as the economy has contracted, she said.
One thing Palantir won’t focus on in its pitch to recruits is workplace perks such as free meals or bringing your dog to work, McLindon said. “We’re not quibbling over trinkets,” she said. “We’re finding people who are aligned with our mission and who really want to be here.”
Oracle Lays Off Hundreds of Employees
The layoffs primarily hit Oracle’s advertising and customer experience group as company emphasizes cloud and healthcare IT services.
Oracle Corp. laid off hundreds of employees this week as the business software provider prioritizes its healthcare IT services and cloud businesses, according to people familiar with the company’s actions.
The job cuts principally hit staff at Oracle’s advertising and customer experience group, the people said. The group sells services to help clients analyze data about their customers and target advertising to those customers.
Oracle’s job cuts come as the company is putting increased emphasis on cloud healthcare services after recently receiving regulatory approval for its $28.3 billion deal for electronic-medical-records company Cerner Corp.
They are hitting a unit that has become less central to the company at a time the digital ad market also is in turmoil. The layoffs were earlier reported by The Information.
The Austin, Texas-based company is the latest in the growing field of tech companies across an array of activities to slow hiring or cut staff. Last month, Microsoft Corp. said it would be cutting less than 1% of its total workforce of about 181,000 employees.
Robinhood Markets Inc. this week said it was slashing about 23% of its full-time staff as the online brokerage reacts to a sharp slowdown in customer trading activity. In June, Netflix Inc. said it was laying off about 300 employees, following a round of layoffs of 150 people in the previous month.
Tesla Inc. has moved to cut white collar staff, and Chief Executive Elon Musk on Thursday said he expected a mild recession that could last around 18 months.
The staffing adjustments come as many tech companies come off a period of supercharged growth that fueled hiring. Sundar Pichai, CEO of Google parent Alphabet Inc. said last week that the economic slowdown provided an opportunity to make necessary business adjustments that are hard to implement when a business is expanding.
Oracle employees were told that they were being laid off because of fiscal year 2023 restructuring and realignment due to new leadership, said laid-off employees. Some layoffs also landed at Cerner as part of the integration of the business into Oracle, one of the people said.
“All of this is retooling the whole company to focus on healthcare,” said Ray Wang, an analyst with Constellation Research Inc.
In its fourth quarter earnings reported in June, the company topped expectations, with overall revenue growing 5% annually to $11.84 billion and its cloud sales advancing 19% from a year prior to $2.9 billion.
The company also reported 25% growth in total operating expenses from the year-earlier period. At the time, Oracle Chief Executive Safra Catz said the revenue growth rate received a boost from demand in its cloud infrastructure services with sales growing 36%.
Oracle, like some other tech companies, isn’t suspending hiring entirely, but being more selective on where it is adding staff. The company’s cloud infrastructure group has around 500 jobs listed on the company’s page for job openings.
Oracle has been pushing hard to close the gap between the size of its business and market leaders Amazon.com Inc. and Microsoft.
Other tech companies are similarly moving personnel from lower to higher priority activities. Meta Platforms Inc. CEO Mark Zuckerberg last week said about his company’s staffing adjustments that, “Many teams are going to shrink so that we can shift energy to other areas inside the company.”
Layoffs are a somewhat regular occurrence at Oracle. The company had $431 million in restructuring costs last year, and $191 million in its fiscal 2022, according to a company filing. The company employed 143,000 employees, according to its annual report published in June.
“We are currently restructuring our workforce and in the past we have restructured or made other adjustments to our workforce in response to management changes, product changes, performance issues, changes in strategies, acquisitions and other internal,” the company said in its 2022 annual report.
Meditation App Calm Lays Off 20% of Staff
Cuts hit marketing department at tech ‘unicorn’.
Calm.com Inc., maker of popular meditation and wellness app Calm, has laid off 20% of its staff, according to a memo sent by Chief Executive David Ko to employees on Thursday.
People familiar with the matter said San Francisco-based Calm employed roughly 400 people, and that approximately 90 were laid off.
“Regrettably, today we are reducing our overall workforce by 20%,” Mr. Ko’s memo said. “While some of you will be impacted, all of you will be affected. I can assure you that this was not an easy decision, but it is especially difficult for a company like ours whose mission is focused on workplace mental health and wellness.”
In the memo, Mr. Ko wrote that Calm leadership had “revisited the investment thesis behind every project” before deciding to make changes that would help stabilize the business.
“We did not come to this decision lightly, but are confident that these changes will help us prioritize the future, focus on growth and become a more efficient organization,” he wrote.
Mr. Ko’s memo didn’t elaborate on the reasons for the layoffs but promised employees “a more in-depth discussion on the future of the business” at an all-hands meeting scheduled for Friday. A Calm spokeswoman declined to make Mr. Ko available for an interview.
One employee who was laid off said company leadership cited macroeconomic trends in explaining the layoffs and told employees that they had tried to reduce expenses in recent months to avoid cutting staff.
The employee and another person familiar with the situation said approximately a dozen roles in Calm’s consumer marketing department were eliminated as part of the cuts.
Mr. Ko was named co-CEO of Calm earlier this year alongside co-founder Michael Acton Smith, and became sole CEO this summer when Mr. Smith and co-founder Alex Tew said they were moving into co-chairman roles.
Mr. Ko had previously been CEO at Ripple Health Group, a healthcare technology firm acquired by Calm in February. Other former Ripple executives have also assumed leadership roles at Calm.
Bennett Porter, a former marketing executive at Ripple, now leads Calm’s consumer marketing division and reports to Vice President of Content Greg Justice, who was formerly with TikTok.
Venture-capital firms several years ago began pouring money into Calm as well as competitors such as Headspace Health Inc., Happier Inc. and Modern Health Inc.
Calm was founded in 2012 and became the first so-called unicorn in the meditation app industry in 2019.
It achieved a $2 billion dollar valuation the following year after a $75 million fundraising round. Investors have included Lightspeed Venture Partners, TPG, Goldman Sachs Group Inc. and Salesforce Inc. Co-Chief Executive Marc Benioff.
In recent years, the company invested heavily in marketing by hiring Mr. Justice and a former Netflix marketing executive, running ads on broadcast television, and sponsoring CNN’s coverage of the 2020 election as well as a 2021 HBO Max miniseries featuring Kate Winslet, Idris Elba and other stars.
The employee and the other person familiar with the situation said Calm’s recent cost-control measures included cuts to its marketing budget.
Peloton To Shed About 800 Jobs
Fitness equipment maker is working to cut costs in a bid to reset the business.
Peloton Interactive Inc. plans to cut about 800 jobs as it looks to reduce its operating footprint and cut costs, the company said Friday.
The New York-based company said it would eliminate its North American field operations warehouses and make cuts within its member-support team, among other changes, resulting in the loss of 784 jobs.
It also plans to scale back the retail operations it had been building out and raise the prices on some of its products in the U.S.
By cutting the warehouses, Peloton will move what it calls its final-mile delivery to third-party providers, Chief Executive Barry McCarthy said in an email to employees, a shift expected to reduce per-product delivery costs by up to 50%.
The cutbacks to the member-support team reflected lower-than-forecasted volume for inbound inquiries. Duties tied to these jobs will also shift to third-party providers, the memo said.
The moves announced by Mr. McCarthy, who took over as CEO earlier this year, come as Peloton is working on an $800 million restructuring plan in a bid to help turn around the business and create positive cash flow.
It also comes after the company announced in February plans to shed 2,800 jobs.
“These are hard choices because we are impacting people’s lives,” Mr. McCarthy said. “These changes are essential if Peloton is ever going to become cash flow positive. Cash is oxygen. Oxygen is life. We simply must become self-sustaining on a cash flow basis.”
Peloton shares jumped more than 13% in Friday trading, but are still down about 62% this year.
Bloomberg earlier reported on Peloton’s plan to cut jobs. The layoff plan also comes as electronics retailer Best Buy Co. cut hundreds of jobs in stores over the past week amid shifting consumer habits and a steeper-than-expected decline in demand.
Mr. McCarthy said the price of its premium stationary bike, called the Bike+, will increase by $500 to $2,495, though the original stationary bike won’t have a price change. Its treadmill will go up $800 to $3,495. A prior price increase for its equipment took effect June 1.
Peloton said while it doesn’t plan on closing any retail stores this year, it will provide updates on which locations will be impacted in the “coming months,” the memo said.
The company has struggled to sustain demand after a boom in sales as Covid-19 health measures kept people away from gyms and consumers splurged on equipment and fitness lessons. It has since acknowledged a series of miscalculations in efforts to further expand the business in recent months.
The company has scrapped plans to move its manufacturing in house after seeing consumer interest slide.
Peloton is expected to release its fourth-quarter earnings report Aug. 25.
HBO Lays Off About 70 Staffers in Latest Round of Cuts
* The Cuts Affect The Programming Team At HBO And HBO Max
* HBO Chief Content Officer Casey Bloys Just Renewed His Deal
Warner Bros. Discovery Inc. is firing about 70 workers who work at HBO and HBO Max, the latest round of cutbacks after its parent company merged with Discovery Inc.
The cuts affect 14% of the staff under HBO Chief Content Officer Casey Bloys and fall heavily on a group that makes live-action programs for kids and families, an area the company is now deemphasizing.
Bloys is also consolidating the HBO and HBO Max comedy development teams into one group, the company said Monday.
Warner Bros. Discovery, formed in April through the combination of Discovery and AT&T Inc.’s WarnerMedia division, has been cutting costs to reduce the debt needed to finance the deal. Chief Executive Officer David Zaslav has said he’ll wring at least $3 billion in annual savings.
Zaslav has surprised the media industry with moves such as shutting down the recently launched CNN+ streaming service and axing an almost finished film, “Batgirl,” which was to run on the company’s HBO Max streaming service. Zaslav has said his emphasis will be on fewer, higher-quality films and TV shows.
HBO has weathered several rounds of restructuring in recent years. Its former owner AT&T created a separate programming team for the new streaming service HBO Max that was led by Kevin Reilly and Sarah Aubrey.
It later consolidated most of the programming for both HBO and HBO Max under Bloys. Reilly left while Aubrey remained.
Zaslav has expressed confidence in Bloys, who signed a five-year contract earlier this year.
Enter Your Zip Code To See Where The Jobs Are In ‘Clean Energy’, Solar, Wind And Electric Vehicles
Nonprofit E2 believes passage of the Inflation Reduction Act will drive more job growth in solar, wind, energy efficiency and electric vehicles.
From roof-top solar installers to the technicians upgrading your home HVAC and green-minded urban planners, more than 3.2 million Americans now work in “clean energy” as of the start of 2022. And while California remains a leader, hiring has spanned red and blue political states from all regions.
It’s a job total that’s up 5% from a year earlier, says nonprofit advocacy organization — and as it claims, nonpartisan — E2, which stands for Environmental Entrepreneurs.
“This data shows clean energy jobs are not red state jobs or blue state jobs — they’re red, white and blue jobs,” said Bob Keefe, E2’s executive director.
The year-over-year growth would have been stronger without the uncertainty brought by wavering lawmakers in Washington mulling incentives for solar, heat pumps, electric vehicles (EVs) and more, said E2, which has advocated for federal movement on clean-energy incentives.
The House, where Democrats also hold a slight majority, will vote on Friday. No Republicans voted “yes,” as GOP senators argued the measure wouldn’t address soaring inflation but would sock Americans with higher taxes.
The bill would devote $369 billion to climate policies such as tax credits for solar panels, wind turbines and EVs, and to tackle the impact of pollution on low-income communities.
President Biden has argued that clean energy, and the technology needed to produce it, can be a boon to American jobs. Already, the broader job market has remained tight, favoring job seekers, even as murmurs of a recession grow.
The strong job market — recent data showed the unemployment rate matching that from the 1960s — may help more workers explore growth areas such as green energy and other climate-minded fields.
As for the E2 report, growth spanned every clean-energy subsector. Those subsectors include renewable energy, such as wind, solar and geothermal, to energy efficiency, electric and hybrid vehicle parts and manufacturing, as well as power grid modernization.
Conversely, traditional fossil fuel jobs from the coal, oil and natural, sectors fell 4%, E2 says, using Department of Energy jobs data in its analysis.
E2 began tracking nationwide employment across the entire clean energy sector in 2015. The E2 site allows viewers to search by zip code to gauge how strong clean energy jobs are in their area. The tool has 2020 data for now, with an update slated for fall.
“Good-paying clean energy jobs are now an important part of the economy in every state, regardless of politics, location or anything else,” said Troy Van Beek, co-founder and CEO of Iowa-based solar developer Ideal Energy.
The estimated likely total pay in the renewable-energy sector, according to Glassdoor, is $131,337 per year in the United States, with an average salary of $96,438 per year. These numbers represent the median, which is the midpoint of the ranges from Glassdoor’s “total pay” model. Additional pay could include cash bonuses, commissions, tips and profit sharing.
This State (And It’s Not California) Logged The Biggest Percentage Growth In Clean Jobs
Every state saw an increase in clean energy occupations, with California continuing to lead the nation with more than 505,000 new jobs (up 4%). Traditional and alternative energy-producer Texas, which led the country in solar and wind energy projects in 2021, followed with 239,000 clean energy jobs (up 7%).
And New York, which passed what some would say are the most
ambitious climate policies in the country in 2019, and in 2021 made major announcements in offshore wind and building efficiency, remains third in the country with 160,600 jobs (up 5%).
The list fills out from there with, in order: Florida, Illinois, Michigan, Massachusetts, Ohio, North Carolina and Pennsylvania.
New Mexico, meanwhile, saw the biggest percentage growth in clean energy jobs last year after it passed clean energy policies, E2 said, calling them “some of the most promising policies in the country.” Growth also picked up in Oklahoma, Kentucky, Indiana and Idaho.
EV Parts And Assembly
Clean vehicles were the big story in 2022. Jobs building electric vehicles grew by a dramatic 26% from a year earlier, according to E2.
The report covers the period before an announcment this summer that electric pickup truck maker Rivian RIVN, +1.82%, which has Amazon.com AMZN, +2.66% backing, would lay off 6% of its workforce, although not at its Illinois plant.
Many Republican-led states, including Georgia, Kentucky, Texas and Tennessee, benefitted greatly from expansions of EV and other clean transportation manufacturers, and also would benefit from electric vehicle tax credits included in the Inflation Reduction Act, even though their Washington representation tends to vote against these measures, Keefe said.
In the bill nearing final congressional passage, new EVs must include a battery that features a large percentage of components that were manufactured or assembled in North America in order to qualify for the incentives.
Not to be outdone, small businesses, the backbone of America’s economy some say, continue to employ the majority of the clean energy workforce.
About 90% of all clean energy jobs were at companies that employed fewer than 100 workers, says E2.
“Policy matters. The Inflation Reduction Act would make it more affordable for more Americans to drive electric vehicles, which means more opportunities for small businesses like mine to keep growing,” said Ariel Fan, founder and CEO of Los Angeles-based electric vehicle car charging company GreenWealth Energy.
Fidelity On Track To Hire 16,000 This Year, Offers Free Tuition As Perk
Fidelity Investments said it still plans to hire more than 16,000 people this year and is offering some workers full college tuition as an incentive.
The tuition benefit will be extended to entry-level employees who answer customer-service calls at several locations including Texas, New Hampshire and Kentucky, the Boston-based firm said Tuesday in an emailed statement.
The perk, which also includes books and other fees, is contingent on the recipients majoring in fields relevant to Fidelity’s business.
“Offering a fully funded undergraduate degree is a great way to get people excited about working here,” Kirsten Kuykendoll, Fidelity’s head of talent acquisition, said in the statement.
The firm met its goal of hiring 12,000 new employees by the end of the third quarter, according to a representative.
Fidelity is among the world’s largest money managers, with $9.9 trillion of assets under administration at midyear and, at the end of August, a workforce of more than 60,000.
Tech Layoffs Send H-1B Visa Holders Scrambling For New Jobs
Mass tech layoffs have left hundreds of workers living in the US on temporary visas with little time to find another job, or they’ll have to leave the country. And many say they’re getting inadequate guidance from the companies that sponsored them.
The tech industry has long relied on the H-1B visa program to meet its need for workers in specialized fields such as computer science and engineering. Amazon, Lyft, Meta, Salesforce, Stripe and Twitter have sponsored at least 45,000 H-1B workers in the past three years, according to a Bloomberg analysis of data from US Citizenship and Immigration Services.
Reports compiled by employees at Meta and Twitter indicate that the latest round of job cuts at those two companies alone has affected at least 350 immigrants. H-1B holders who become unemployed can remain in the US legally for only 60 days without finding new employers to sponsor them.
Many people with H-1B visas have been living in the US for years, awaiting permanent citizenship. Now they’re frantically searching for jobs, along with thousands of other tech workers in a newly competitive labor market. Some have mortgages, student loans and children in school.
At the same time, many major employers have frozen hiring, and recruiting is typically slower during the holidays. With deadlines looming, desperate job hunters have turned to their professional networks to find a way to stay.
Some have made direct appeals on LinkedIn, generating threads with hundreds of responses, including many citing job openings in the US and overseas. Crowdsourced spreadsheets and referrals abound on social networks.
More than a dozen recently cut workers spoke with Bloomberg; they requested anonymity to avoid angering their former employers or jeopardizing their job hunt.
One former Twitter designer, a 30-year-old who has been in the US for 14 years and was let go in November along with 3,500 colleagues, says she had long imagined this scenario, living in dread of having to pack up everything and leave the country on the fly. “There’s always this thing going back and forth in our minds,” she says: “Will I need to move?”
The H-1B program allows US employers to recruit foreign workers with college degrees in technical fields where there’s historically been a shortage of Americans. Visas are issued for three years, with possible extensions. The number of people allowed in each year is capped at 85,000, and demand is high, particularly among Indian professionals.
The median salary for an H-1B worker was $106,000 in the third quarter, according to data from the US Department of Labor. But workers at top tech companies make much more. The median salary for an H-1B worker at Meta, Salesforce and Twitter was about $175,000, not including hefty bonuses and stock options.
The layoffs have had an especially big impact on Indians, who tend to be on temporary visas longer than other foreign groups because of backlogs in getting permanent residency (a green card).
Each country is typically allowed a maximum of 7% of the employment-based green cards issued each year, so while there are almost half a million Indian nationals in the queue, only about 10,000 green cards a year are available for them.
A congressional report estimated that Indians filing in 2020 would have to wait as long as 195 years for a green card. Chinese workers faced an 18-year wait; for people from the rest of the world, it’s less than a year.
At the start of the year, one H-1B holder from India had just bought a house in Seattle to start a job with Meta. Eleven months later, he’s searching for a company to hire him and sponsor his visa transfer.
The father of two, who has an MBA and has lived in the US for 15 years, says he’s hoping to find a job as a technical product or program manager. He’s been scouring his networks on LinkedIn, joining dedicated WhatsApp groups and submitting application after application.
“You have to spend months preparing for some of these jobs,” he says by phone, over the sound of his young children singing in the background. “It’s hard to tell yourself that even after 15 years being properly documented you still might not have a way to stay. The path to residency is broken.”
Companies, which must pay for H-1B workers to return to their home country if they have to leave the US after losing their job, have offered varying levels of support for immigrants. Five former Twitter employees on temporary visas say the company has provided little assistance and wasn’t clear when their 60-day grace period starts.
When one worker asked for clarification, a company representative recommended finding their own attorney, because the law could be interpreted in different ways. Twitter didn’t respond to a request for comment.
Aditya Tawde, an engineer from India who works at LinkedIn, calls immigration support from US companies the “bare minimum.” He was laid off by TripAdvisor early in the pandemic. After taking two days to process his layoff, he interviewed with 25 different employers and found a job with just two weeks left on his visa. “It’s natural to feel sad and angry,” he says.
A USCIS spokesperson says the agency is exploring policy options to address challenges faced by immigrant communities and is committed to increasing access to immigration benefits.
Vidhi Agrawal, a visa holder from India who wasn’t affected by layoffs, has been working with a friend to build a database of H-1B workers in need of jobs. After two weeks, it listed more than 350 people.
She and her friend have been reaching out to recruiters on their behalf to help. Agrawal, who works at DataBricks and moved to the Bay Area from India 11 years ago, is part of the green card backlog. “It’s scary to be on a visa and lose a job, especially when you have kids and have to uproot and leave,” she says.
Cecy Cervantes, a recruiter at a 15-person tech startup in New York, says LinkedIn has gone “crazy” with job appeal posts from people on visas who’ve suddenly lost their jobs. She woke up on Monday last week to 47 messages rather than the usual 10, and she has already interviewed four people on H-1B visas who’ve been laid off by Twitter and one from Meta.
Meta Chief Executive Officer Mark Zuckerberg, who announced 11,000 job cuts this month, told employees that visa holders would be given “notice periods”—which can buy them more time before their visa clock starts ticking—and assistance from “dedicated immigration specialists.”
But one former Meta employee says the consultation wasn’t helpful. The attorney had offered similar advice to Twitter: “Find your own lawyer.” Others said they appreciated the support.
Stripe, a payment processing software company that cut more than 1,000 jobs this month, offered consultations and help with changing visa status wherever possible. Lyft said it was willing to keep workers on its payroll without working for a few extra weeks to extend their clocks.
Amazon is giving workers 60 days to find a different job internally before taking them off the books, which extends their visa clock, according to three ex-employees. Salesforce declined to comment on whether it was offering immigration assistance for those it was laying off.
“There is serious pressure to find jobs,” says Fiona McEntee, an immigration attorney with McEntee Law Group in Chicago. “The issue is the ticking clock.”
Some have already given up hope. A 34-year-old product manager laid off by a large fintech company says he’s halfheartedly trying to find a job in the next few weeks but has largely made up his mind to move back to India. A University of Chicago graduate, he’s been living in the US for seven years.
Going back to his hometown of Bengaluru may be a “blessing in disguise,” he says—he’ll be able to spend more time with his aging parents and start his own company, which is hard to do while you’re on a visa. “I am burned out,” he says about the green card backlog. “I don’t see a light at the end of this tunnel.”
Tech Workers Talk About Getting Laid Off
A surge in job cuts has upended the lives of many people who thought their careers were headed in the right direction.
Anushri Jhunjhunwala, 22
Data scientist in San Francisco
Laid off from Meta Platforms Inc. in November
I was on the trust and safety team for Messenger and Instagram at Meta. It was my dream company. Our managers and people we worked with told us not to worry about layoffs, because we’re an important team. And because I was a new grad, I was one of the lowest-paid employees at the company. I thought that if they had to let people go, it wouldn’t be me.
That is a really big life change—when you go to a big tech company that is supposed to be nice, cushy and comfortable. I never considered getting laid off. It was overwhelming. My first thought was, I’m an international student and I’m here on a visa that depends on me being employed.
Given I had friends who got the same Meta job and started working in the summer or even later, I’m thankful I started in February. At least that gave me more time there.
Andy Enkeboll, 34
Data engineer in Dobbs Ferry, New York
Laid off from fintech company Plaid Inc. in December
I hit the ground running after getting laid off and didn’t take much time to process. Unlike market conditions a year ago, companies are tightening their belts. I’m competing with thousands of other people from Amazon, Facebook and Goldman Sachs. I know it’s not as green a field as it used to be, and I didn’t want to waste time relaxing when opportunities are few and far between.
I think I very much want to stay in tech. I’ve always enjoyed the places I’ve worked, and it’s never felt a lot like a lot of “work” work. One of the areas where there’s a lot of opportunities is at early-stage startups in early-stage industries. But I have a family and a kid. I can’t just uproot and live on a beet farm, and can’t put all my chips in an early-stage startup that has an unforeseeable future. I have to be pragmatic about the opportunities and the decisions I make.
Jon Stahl, 49
Product manager in Seattle
Laid off from Salesforce Inc. in January
Getting laid off is always a surprise, but it’s not shocking. I was prepared for the possibility.
My career has always been about making a positive impact on the world and solving big social problems like climate change, equity and social justice. I started doing this work in 1995, and that’s always been what I’ve worked on in one way or another.
Technology is a very powerful tool to apply to those problems, and the broader work of using technology to solve social problems absolutely goes on. You don’t have to read too deep in the newspaper to find that we’re in an all-hands-on-deck situation with humanity.
I would say I’m not someone who has ever planned out my career in a traditional sense. I’ve been lucky to recognize the right next step when I see it. I feel like I’m entering the mode of looking and sitting and talking to a lot of people. I have a pretty good idea of what kind of places I should be looking and what kinds of questions I should be asking. I have a pretty strong network to draw on.
Nothing is certain, but I’m optimistic. I’m treating it as an opportunity and not a crisis.
Elyse Marr, 36
Director of strategy in San Francisco
Laid off from Komodo Health in December
My husband and I lost our jobs in tech at about the same time. It was our first time in the industry. We need to ask ourselves: Do we want to get back on this ride? Or was that a nice thing to do for a short period of time?
With so many layoffs, there’s a sort of shared reflection in the sector as we ask ourselves: What does it really mean to buy into this long-term gains premise? Fundamentally, what are we buying into when we join a VC-backed company? A lot of people don’t always understand how that machine works.
We joined in our mid-30s. I think that matters. You have to be really good at personal finance to know what you’re signing up for. This is a financial construct you’re buying into, VC-backed tech. It’s kind of a young person’s game, or a wealthy person’s game.