If the Stock Market Is So Up, Why Are Jobs So Down?
Now is the summer of our discontent. Yes, I got the "Richard III" quote wrong. But season aside, Shakespeare's words from the 16th century pretty much sum it up.
This summer has seen Charlie Sheen dive off the deep end, the Casey Anthony trial divide the nation, Arnold Schwarzenegger's infidelity come to light, and a phone hacking scandal threaten to bring down media tycoon Rupert Murdoch.
We've seen housing values drop, yet again, and unemployment rise, yet again. Our 24-hour news cycle bombards us with repetition of bad event after worse event. And perhaps nothing has pounded us more this summer than the political posturing taking place in Hollywood -- oh, wait, I mean Washington -- about the debt ceiling and job creation.
Somehow, in the midst of this summer of discontent, the summer of everything good being down, and everything bad being up, the Stock Market continues to gain ground. In fact, since the low on March 6, 2009, of $6,626, the Dow Jones Industrial Average has grown nearly 200 percent. And yet the economy continues to flounder, job growth is nowhere in sight, and Americans feel like they are watching the fat cats of Wall Street cash in once again.
Did I just wake up in the middle of a "Twilight Zone" episode? Or is this just business as usual, meaning we haven't learned anything and nothing has changed.
The Power of Business to Make Life Better
I don't know about you, but I'm tired of things not getting better. And I'm also conflicted. Because in the strangest way, I want to both revere and revile Gordon Gekko, the "greed is good" movie protagonist and/or antagonist from the 1980s capitalist epic "Wall Street."
On the "revere him" side, I am a firm believer in the power of business to make life better. Job creation, better products, societal betterment, business growth and the effective flow of capital are key structural components of sustained economic growth. In fact, in every era of societal development in the U.S., entrepreneurship and innovation (in both the industrial and military complexes) have paved the way toward our status as a global superpower. In other words, business-minded thinking is really good.
But here's the problem as I see it. The financial and ownership structures of for-profit businesses in our country are now hindering our ability to grow the economy. Where we once had free-markets and true competition, we now have a constant pressure for quarter-on-quarter increases in shareholder value. This shortsighted, impatient need for continuous growth and rising returns is spurred on by a pervasive societal attitude -- not only is "greed good," but now we immediately "want it all" without doing any of the work required to get there.
And here's where the "revile him" side of my feelings about Gordon Gekko come in. This pressure-cooker environment, in which one bad quarter can send a publicly-traded company with good financials and a long history of success into a tailspin, is having drastic consequences on the American workforce. Businesses are making small-minded reactionary responses, instead of long-term plans, causing the layoffs of workers, the closing of operations and, in many cases, the shuttering of doors.
One could say it is about survival of the fittest. But Darwin's actual quote says that longevity is really about the survival of the most adaptable. When the quarterly earnings expectations of the Wall Street pundits and ratings agencies cause a fundamentally strong company to stumble, there is no time for adaptation. Businesses are forced to find ways to tighten their belts and keep on going.
With nary a scratch, corporate America has continued to swell over the past 28 month, and it makes me wonder, "Why aren't we all feeling the effects of the rising tide?" One explanation is that while companies collectively battened down the hatches during the recessionary storm, they realized that if they cut staff and made every person do the work of two, they could learn to be profitable with a smaller workforce.
Fixing the Problem of Greed
Sadly, this means that those who can afford to hold valuable stock assets in their portfolios will continue to get richer, while those who can't -- those people upon whose backs this great country was built -- are left out of the game. Meanwhile, the chasm between those willing to work hard and those who want everything without having to work is growing wider. We find ourselves stuck in the perfect storm of impatient investors, a 24-hour news cycle with attention deficit, a frustrated workforce (according to a recent Conference Board report, over 55 percent of Americans are unhappy in their jobs), an obsession with celebrity, and a populace dragged down by general malaise and laziness. It's quite a situation we've gotten ourselves into.
Fixing the problem of "greed," in all of its hungry forms, is a huge task. Yes, there are movements and innovations, such as triple-bottom-line accounting, that are drawing us more toward sustainable business practices. Some organizations are trying to lead us to a re-imagined kind of business -- a new kind of corporate America. But progress is slow. As they say about fatty foods, "a minute on the lips, forever on the hips." It was a slippery slope into this mess. It is going to take time, and self-sacrificing effort to dig us out.
So in the meanwhile, what is the regular, hardworking American to do? If companies aren't really hiring, how can you find work? My answer is two-fold:
First, companies actually are hiring. It's just that their hiring practices have changed. According to recent studies, 50 percent of new hires come from referral, and 25 percent come from employees' social networks. That means that over 75 percent of new hires come from networking or direct recommendation and introduction. If this is true, then it is time for you, the worker, to rethink the way you are going about looking for work, and make sure that you are pursuing employment opportunities using current practices. It also means that you better be prepared to put your best foot forward, and be ready to work hard and learn to grow within your role. The best way to put your job search woes behind you is to find and secure a good job, and then find ways to have that job grow with you over the coming years.
The second, and perhaps slightly riskier way, is to create something new. As the face of American business is changing, so is the makeup of the American workforce. Whether you have a desire to be a massage therapist, do home repairs, sell on eBay, join a multi-level-marketing company or hang out your own shingle and be an accountant, the potential and possibilities are endless.
None of this is easy. Especially with the heat index bringing temperatures to record highs in over 60 U.S. cities so far this summer. But it is time for us all to calm the frenzy, stay cool in our thinking and not let the rising stock market get you down. Take control of your working future by taking responsibility for your work prospects. Don't wait for Washington or corporate America to give you permission. Claim your career and to get back to work.
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