Hourly workers — the foundation of the labor economy — representing 56% of the total US workforce — often have limited to no opportunity to build long-term equity in the economic world they are helping to create.
That’s the observation that is being made by Jason Lee, the founder of technology company DailyPay - a unicorn in the HR and payments space - in his new blog entitled “Ownership at Work.”
Lee argues that over the years, companies have tried valiantly to roll out the same structures and tools for hourly workers that they currently deploy for salaried employees in an effort to enable hourly workers to build long-term equity, but to no effect. Lee posits that when an hourly worker stays at a company on average for ~3 months, it’s no surprise that as much as half of the private sector workforce doesn’t participate in 401(k) or pension plans.
Lee provides the example of the staff of a local restaurant that tends to their varied customers as if they were part of one big family, learning their names, preferences, dietary restrictions, and favorite sports teams — all while delivering piping hot food and drinks on demand. Over time, this top-tier service compounds to the benefit of the restaurant. For all intents and purposes, hourly workers are compensated as if the ongoing value they add to the company doesn’t compound across time. Lee argues this has contributed to the economic mobility experienced by so many, and an unsustainable moment in the labor economy today.
Lee concludes by warning that each day that passes in the post pandemic world is another reminder that the labor system needs to be reconsidered. The lack of the ability for workers to own anything permanent may be why there are declines in labor force participation for almost two decades, and a sustained 2% drop since 2020. Lee believes that there needs to be a way to create ownership for hourly workers — one that leverages technology and the free market to give hourly workers a useful and lasting piece of the world they’re creating.
Jason Lee can be reached on Medium, where he first published this full article.
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Country: United States