Tuesday Digestif (50/2015): On-Demand Workers All Again ๐Ÿš™

Tuesday Digestif: Weekly Perengo Newsletter on Labor Policy & HR Management


Today we cover (1) workforce classification issues in the gig-economy, (2)wage growth in the U.S. economy, and (3) the trend of up-skilling.

Cover Story

Last week our team attended a fireside chat with Tony Xu (Doordash CEO) and Alfred Lin (Sequoia Capital Partner).

The most interesting take aways were:

  • Big problem in operations is thatย “smart people automate bad processes too early”
  • The roots of Silicon Valley lie in product development and engineering hence it seems that “people management is an underrated and underdeveloped skill”
  • “SMBs have 3 major problems: (1) hiring, (2) marketing, and (3)distribution/revenue generation.”
  • Classification of the workforce (independent contractor vs. full-time employee) is still a unresolved topic that will need (a) governmental guidance and (b) practical implementation.

A couple of weeks ago we wrote a analysis on workforce classification.

Read the full story here.

Diversified Workers: A topic for the presidential campaign and beyond.
Diversified Workers: A topic for the presidential campaign and beyond.

This Week’s Finest

Finding Quality Workers Is a Top Concern (url) – Rising challenge for employers to recruit means it will drive up the average wages.

This October wages grew 2.5% – that’s a 8-year high. Economists project further wage growth for 2016.

As Mitchell Rosen (Small business owner) puts it:

“Paying someone a little bit more is easier than continually training someone new. Training is expensive.

It’s very hard to find quality workers.”

The Bureau of Labor Statistics Needs Funding (url) – Over the past five years U.S. Congress has cut the BLS’ budget by 16%.

Think about it this way: “No BLS = No clear labor market data”

It has gone so far that private foundations (including JP Morgan Chase Foundation & Walmart Foundation) are trying to support the BLS.

The question remains whether such involvement will maintain the rigorous analysis and objective data quality of the Bureau of Labor Statistics.

Worth Reading – Up-Skilling Issue:

From Coal to Codeย (url) – A Kentucky-based company hires former coal miners to train them how to code.

This is a prime case study of how to up-skill when automation ‘eats entire professions’.

Millennials on Auto-Pilot (url) – Long story short: if you want to motivate your Millennial employees, create an environment that encourages self-directed learning.

EXTRA: Do Millennials Make for Bad Employees? (url) – In 2015 Millennials overtook Baby Boomers as biggest share in the workforce.

Yet the word is out that this cohort of employees is being called ‘lazy, entitled, and narcissistic.’

Bottomline: research and employer surveys paint a different picture. It might be a bigger challenge to manage millennials but their inherent qualities make for high-output employees.

Recommended by our reader Simon.

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Have a great week,
Team Perengo

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