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American workers have the upper hand over their employers right now — and there are tentative signs it could last, even as economic storm clouds gather.  

Why it matters: Put simply, your boss needs you more than you need her.  And it might stay that way, at least for some workers, particularly those on the lower end of the wage scale.

The big picture: There just aren't as many workers these days, as demographic forces were supercharged by the pandemic. 

"The labor supply has shrunk, which gives workers more leverage, more bargaining power and pushes employers to compete harder and improve job quality," Aaron Sojourner, a labor economist at the University of Minnesota, tells Axios.

State of play: It's a tight labor market, with unemployment near a record low. And, crucially, there are jobs! jobs! jobs! for almost everyone who wants one  — 1.9 jobs for every unemployed worker according to the latest BLS data.

Headwind ahoy: Fed chair Jerome Powell called this labor market "tight to an unhealthy level" in March, when there were 1.7 jobs for every worker. The Fed is raising rates in an effort to cool things down, which could mean higher unemployment rates. 

Yes, but: There are a few reasons workers may emerge from this tightening period with their power intact:

Baby Boomers are finally leaving the stage. Labor force participation for those 55 and older is nearly 2 points lower than in February 2020. 

There aren't as many Millennials or Gen Zers to replace them, as Axios chief economics guru Neil Irwin has written.

People with long COVID, or who are facing child-care pressures or even dealing with substance abuse, are also missing from the labor force. So are a large number of immigrants.  

And regardless of the tight market, a lot of folks may not be willing to put up with the same old mistreatment. They've been through a traumatic experience since March 2020.

"A lot of people felt kind of pushed around," Sojourner said. "Either they were laid off or they were asked to do a lot of things they hadn't signed up for."

Now those folks are rethinking their relationship to work. There's a "re-sorting" happening, said Chicago Fed president Charles Evans recently. 

That's good for workers and "painful" for some businesses. "[T]here are just a lot of businesses where their business model probably isn’t going to work the way it used to," he said.

What we're watching: Workers' empowerment is also creating the rumblings of a resurgence in union organizing, although unionization rates in the U.S. are still stubbornly low.

There were 661 new union filings in the first quarter of 2022 — these are petitions from groups of workers seeking to hold union elections. That's up from 448 in the same quarter in 2020 before COVID, according to data tracked by Kevin Reuning, a political science professor at Miami University. 

Whether or not these filings result in newly unionized workers is the open question when it comes to worker power.

The bottom line: The pandemic-fueled demographic forces at play here tightened the labor supply to such an extent that even if the economy slows, these newly emboldened workers may get to keep their leverage.

Workers' leverage is here to stay

Workers' power may outlast a slowing economy.

Raised fist with little raised fists in it

Employment

Jobs

After a record economic expansion, the coronavirus pandemic sent the U.S. economy into a recession as unemployment soared to staggering heights. The country now faces urgent questions about how much stimulus is needed for reeling consumers and businesses, and what a recovery might look like.

Economy & Business

This week, the 500 employees of Axios will get together in person — for our first company-wide retreat since the pandemic hit. 

Why it matters: A staggering 75% of our colleagues joined after March 2020. So most of them will be experiencing Axios in person for the first time. They've never set foot on a piece of Axios real estate, and they've never met most of their coworkers in real life.

This is the reality for companies all over the world.

Zoom out: In our work-from-anywhere world, the company retreat is more essential than ever.

Remote work has a slew of benefits — from flexibility for workers, to a limitless talent pool for employers

But it strips away the togetherness and serendipity that makes companies stronger and bolder.

Zoom in: Very early in the pandemic, the leaders of Axios decided we'd be remote first, forever. That was based on two hunches, both of which have proved correct: 

Offering remote work to all hires gives you an edge in the battle for talent — the whole game for a growing company. 

Whatever return-to-work plans an organization made, they'd have to change them. So why not just start with an employee-first approach?

Our thought bubble: Our staff, like most, has proved incredibly productive and resilient in shutdown. But we started warning early that employers were taking a false signal from the success they were having with work-from-home.

Yes, there were advantages, including the time saved from not commuting. But there was a real price in culture and creativity — the intangibles that come from spending unstructured time together, without the transactional, agenda-driven structure of a Zoom.

In a new study, researchers found that people are less creative in virtual meetings than live ones.

What's next: Schedule innovation. Bring teams together at retreats to germinate the next set of great ideas.

This doesn’t have to be in person. Bosses won’t get anything out of forcing people to show up when they’re concerned about child care or health. The standard video meeting may stifle brainstorms, but you can retreat in the virtual world. 

The new world of work has spurred a whole industry around remote creativity — including virtual golf outings via VR headsets.

Most will do what we are doing: a mix of team, regional and all-staff gatherings to spark human connections — and fresh ideas.

The bottom line: Pre-pandemic, 8% of U.S. office workers were fully remote. Now, 32% either are remote or want to be, per Gallup polling. And most others want hybrid work.

That's a third of your workforce that relies on well-organized, fun retreats to soak up company values and forge friendships.

The future of retreats

A staggering 75% of our colleagues joined after March 2020.

Illustration of a vintage postcard that reads "corporate retreat"

Remote work

Axios Closer

Amazon is partnering with the National Immigration Forum, an advocacy group based in D.C., to help refugee and humanitarian-based immigrant employees obtain citizenship, the group announced Monday. 

Details: The partnership is an extension of Amazon's Welcome Door program, which launched about a month ago.

Through the program, eligible Amazon employees receive free social, legal and financial support, such as mentorship, skills training — which includes college tuition — and reimbursement for work authorization fees.

The program has been offered to employees in the U.S. starting in April, with the company planning to expand it globally by the end of the year.

The big picture: Amazon and nearly three dozen major companies, including Facebook, Uber and UPS, committed to hiring and training Afghan refugees last fall.

In March, more than 50 companies, including Amazon, vowed to support people fleeing Ukraine. 

What to watch: The U.S. expects to admit up to 100,000 refugees from Ukraine. More than 76,000 Afghans have been brought to the U.S. so far this year. 

Amazon will help refugee employees obtain citizenship

The company is partnering with the National Immigration Forum.

The George Washington Bridge hangs its 60 x 90-foot American flag from the New Jersey side tower to mark Memorial Day as an Amazon truck heads to New York City on May 31, 2021 in Ft. Lee, New Jersey. 

The George Washington Bridge hangs its 60x90-foot American flag. Photo: Gary Hershorn/Getty Images

Amazon

Immigration

President Biden has made the COVID-19 crisis and a post-Trump return to national unity and traditional democratic ideals his top priorities. From vaccinations to stimulus to schools, Biden is seeking bipartisan compromise while showing a willingness to use executive authority and bare Democratic majorities in the U.S. House and Senate to implement his policies. Republican leaders are navigating deep party divisions over if and how to move beyond former President Trump.

Politics & Policy

The work from home revolution, grudgingly embraced by Corporate America, has evolved into a thing that workers both love and hate.

Why it matters: This week, an Atlantic article confirmed something knowledge workers have known for a while: Remote work has led to much longer hours, and a grueling schedule of meetings that underscore the limits of flexible arrangements.

Driving the news: JPMorgan CEO Jamie Dimon, a notorious scourge of remote work, abruptly reversed himself in his annual letter published this week. 

Dimon’s volte-face is a reflection of a broader vibe shift on Wall Street, bowing to the realities of a workforce still reluctant to return to cubicle life. 

But some employers are hitting workers where it hurts – in their wallets – to get them to return to the office, according to Fortune.

What they’re saying: NBCUniversal News chair Cesar Conde told Axios’ What’s Next Summit that “a hybrid, flexible work environment is a net-net positive and will be an ongoing part of our culture.” 

Yet Conde also emphasized “the power of proximity” (i.e. in-person interaction) as something the news giant aims to “recreate.”

And in his letter, Dimon insisted that remote arrangements would “need to work for both the company and its clients.”

State of play: Demand from digital nomads have spurred a boom in co-working spaces, but raise questions about why it’s more suitable to camp out in a public space than a traditional office. Meanwhile, some employees have sued their employers to recoup unreimbursed costs from WFH outlays.

Out thought bubble: Axios' Emily Peck and I have both chronicled the growing downsides of being a member of the Zoom class, including virtual meeting fatigue, and the resulting drag on service sector activity. 

The bottom line: The way we work now has clear benefits, but comes with trade-offs. In the coming months, some bosses may well decide that WFH isn’t worth the compromise, or the strains it puts on employers and workers.

WFH revolution showing signs of wear

The movement, grudgingly embraced by Corporate America, is creating negative ripple effects.

Illustration of a pillow on a couch in the shape of a wifi symbol

Amazon workers' historic win last week in New York may wind up spurring union growth around the country after decades of decline, at a time when a tight labor market is empowering workers in ways that once seemed impossible.   

The big picture: A remarkable confluence of factors — including a pro-labor White House, once-in-a-century pandemic and a super tight labor market — helped Amazon workers in Staten Island achieve a David and Goliath union victory, with almost no backing from traditional institutional labor.

"It has electrified all of our members and organizing leaders," said Mary Kay Henry, president of the 2 million-member Service Employees International Union (SEIU).

The new Staten Island Amazon union has been contacted by employees at 50 other buildings in the U.S., according to the organization's president and founder, Christian Smalls.

Another Amazon warehouse across the street from Smalls' building has a union vote scheduled for April, said Seth Goldstein, the group's lawyer. And a separate group of AmazonFresh employees — inspired by the Staten Island efforts — voted to unionize and are moving forward, he noted.

What's next: Other large employers are on edge about what this means for them.  

"If Amazon, the consummate on-top-of-things company, can get bested after spending $4 million last year on labor relations consultants, then other companies may be more vulnerable to organizing than they’ve long seemed,"  Josh Eidelson wrote in Bloomberg. 

Starbucks CEO Howard Schultz on Monday said the company was "being assaulted, in many ways, by the threat of unionization."

Between the lines: This wouldn't have happened without COVID-19. Smalls started organizing in protest of the warehouse's health and safety conditions during the pandemic. 

The win also may not have happened if a different president was in the White House. One of the first things Biden did on inauguration day was fire the management-friendly general counsel of the National Labor Relations Board, ultimately replacing him with Jennifer Abruzzo, who's enforced the labor laws with a zeal not seen in a long time. 

A key NLRB settlement with Amazon in December paved the way, enabling organizers to talk to warehouse workers even when they weren't on duty, over-riding a company policy that permitted workers to stay at work for just 15 minutes after their shift.

 "It would have been a very different outcome under a Trump board," said Ana Avendaño, a former lawyer at the AFL-CIO who now teaches law at University of Texas, Austin. The settlement was national and energized workers around the country.

Missteps from Amazon didn't help: a leaked memo in which the company's lawyer called Smalls, who is Black, "not smart, or articulate." Or, the way the company handled a tornado in Illinois that killed six workers.

"There were just a lot of things that really, you know, make you wonder about whether Amazon is truly the woke company it pretends to be," said Goldstein, a longtime labor lawyer (he represented the Kickstarter union) who handled this effort pro bono — accepting a red Amazon labor union T-shirt for his fee.

This victory is also a rebuke to traditional labor unions, which have thus far failed in their efforts to unionize other Amazon locations.  

The Staten Island organizers took some risks that traditional unions would've avoided and, Avendaño said, their non-affiliation with Big Labor was a selling point in organizing.

"There is no strong leadership in [institutional labor]," said Avendaño. Going forward, the union groups will offer support to Smalls' group as it moves into the next stages.

Goldstein, who is 60 years old, also attributed the win to the organizational zeal of millennials. "Young people today are more like my grandparents who did see a value in unions. The circle turns."

State of play: The vote was just the first step in a long process. Now the union must negotiate a first contract with Amazon, which will likely challenge the vote before they even get to the bargaining table. Even in a best-case scenario, that takes a year.

"That's the hard part," Avendaño said. Expect the union to look to negotiate over wages, scheduling, health care and safety, she added.

Amazon didn't respond to questions, and pointed Axios to an online statement.

Amazon workers' union victory is turbocharging a new labor movement

Other big companies fear they'll be next.

Business and thought leaders around the future of work and professional mobility came together at Axios’ inaugural What’s Next Summit on Tuesday for a discussion on how employees now prefer to be treated like customers.

Why it matters: With COVID-19, the great resignation and technological shifts, everyone from business owners to job seekers are asking what jobs will look like in the years to come.

The big picture: Over the past two years, people have fled multiple industries in droves as health concerns, remote work, job/life balance, career expectations and opportunities have shifted. 

Last year, studies showed upward of 40% of workers were considering leaving their jobs.

What's happening: The discussion, moderated by Axios executive editor Aja Whitaker-Moore and Axios Finish Line co-author Erica Pandey, revolved around how evolving culture, values and geographical considerations have radically changed the professional landscape.

“Fair compensation is table stakes,” senior partner at PwC Terri McClements said during the session, highlighting how competitive hiring has become for employers.

As people have left companies and industries, seeking more schedule flexibility or more fulfillment, prospective employees expect companies to offer more robust forms of compensation.

“They want to know whether your culture meets theirs,” Shannon Schuyler, chief inclusion officer at PwC, said. “They want to be treated with dignity. They want to be treated like the customer.”

About this shift in attitudes, Schuyler said, “If we’re not excited about it, then just move aside because it’s going to happen with or without us.”

Access to flexible schedules and remote work has unsurprisingly proved to be a large factor in employee well-being throughout the pandemic. As business leaders eye a return to the office, the What’s Next Summit discussion prompted participants to recognize who exactly is most excited to come back.

“The people who are coming back are white male executives and non-caretakers,” Brian Elliott, executive leader at Future Forum, said.

Discussion participants said that remote work offers more time for those with families, but it allows for an escape from micro-aggressions, code switching expectations and other difficulties faced by people of color.

Elliott said when it comes to looking at returning to the office, considering all the difficulties a team faces is essential. 

“You’ve got to walk your talk,” Elliott said. “It’s got to start at the executive suite.”

According to the discussion’s participants, these workforce evolutions are even more of an expectation in younger generations. 

Kristin Sharp, the CEO of Flex, which serves app-based earning platforms, said that she had heard from younger users that the traditional, single-job career path seemed to them “fundamentally unstable, because you only have one income source.”

A recent college grad said in the discussion that she had felt in “high demand” while job searching but also shared the importance she placed on an organization’s activism, environmental impact, amenities, student loan reimbursement programs and mentorship opportunities.

The bottom line: How companies adapt to evolving expectations around hiring, corporate identity and office space seems increasingly important to prospective job seekers.

Editor’s note: This post has been corrected to identify PwC senior partner Terri McClements as the source of a quote (not PwC partner Terri-Ann Dautzenberg).

As the workforce changes, employees want to be treated like customers

Everyone from business owners to job seekers are asking what jobs will look like in the future.

Axios Events

From the Valley to D.C., Big Tech players like Facebook, Google and Amazon are under more scrutiny than ever as new technology develops and privacy and antitrust concerns grow in lockstep with companies’ ambitions.

Technology

Sectors with biggest improvement in unemployment rate

There was good news in almost every part of the March jobs report this morning   — particularly about workers who were most impacted by the pandemic.

Details: The unemployment rate held steady or fell for every demographic group (race, ethnicity, gender) compared to February.

Women, for the second month in a row, gained a significant portion of new jobs.

The unemployment rate for Black women 20-years and older fell.

The unemployment rate fell for workers 55 and older too.

The number of people who said they were unable to work because their employer closed or lost business fell by 40% — from 4.2 million in February to 2.5 million last month. 

Sectors to watch: Compared to last year, unemployment rates have fallen significantly in services (leisure, hospitality, retail) as the economy reopened. 

The 0il and gas industry notably staged a bounceback from pandemic low production, with business activity jumping to its highest reading in the six-year history of a Dallas Fed Energy Survey.

March jobs report good for workers hit hardest by pandemic

Women were among workers who rejoined the labor market in March.

The era of excess savings, one of several factors behind the U.S. labor shortage, may be coming to an end.

Driving the news: In a comprehensive study of the worker drought, labor market analytics firm Emsi Burning Glass found the decline in extra cash is a possible impetus for getting workers off the sidelines.

With only 6.5 million unemployed, the firm estimated that “even if every unemployed person got a job today, a shortfall of well over 4 million workers would remain.”

Why it matters: As of February, there were over 11 million unfilled U.S. jobs, even with COVID-19 in broad retreat and skyrocketing inflation forcing consumers to pinch pennies.

Consumers have become inured to soaring prices by effectively shopping their way through it, especially by tapping personal credit. 

But Thursday’s data, which showed a drop in inflation-adjusted consumer spending, suggests those pillars of strength are starting to erode.

Falling excess savings, accumulated from various sources during the pandemic and estimated at nearly $3 trillion, is seen luring reluctant workers back into the fray.

What they’re saying: “When looking at personal savings, it shot up last year, but has been working its way back down to equilibrium.” Ron Hetrick, Senior Economist at Emsi Burning Glass said on LinkedIn recently. 

“We are watching those savings rates, as well as credit card debt, to see that eventually people will hit their cap, which is a good sign because it may mean that some people are getting ready to come back to work.”

Our thought bubble: Machines are slowly encroaching on the turf of low-skilled workers. 

The worker crunch is economically unsustainable, and it's feeding a rise of the robots that suggests those jobs might not be available when workers opt back into the labor force.

Declining savings may force workers off the sidelines

One of several factors behind the U.S. labor shortage may be coming to an end.

Economic data

A robot-assisted way of life is becoming more and more the norm as companies have improved their technologies and the cost of those technologies have come down. 

Why it matters: As employers continue to struggle to find workers to fill certain jobs, and the world's population ages creating a smaller future workforce, automation in many fields is a necessity.

Driving the news: Walgreens Boots Alliance has opened new prescription fulfillment centers populated with robots that can do a typical pharmacy's daily work in an hour, with plans to open 22 over the next three years.

One drone company is now delivering food in Texas in addition to servicing 10,000 homes in North Carolina.

Alphabet’s self-driving car company Waymo just launched in its first major metropolitan area, San Francisco, following a similar move by General Motors’ backed company, Cruise. 

In New Jersey, a hamburger vending machine has landed inside a mall, while White Castle has announced it plans to install robot fry stations in 100 locations. 

The big picture: Automation will lead to 11 million jobs lost in the U.S. within the next 10 years, analysts at Forrester recently predicted. 

Yes, but: When factoring in an estimated 9.6 million jobs that will be created over the same time created in new fields, the net jobs lost will ultimately be about 1.4 million.

What they’re saying: Automation will impact nearly all jobs — but not replace them.

“Technology taking all our jobs is a constant fear ... that never materializes,” analysts at Forrester wrote in a report earlier this month.

“The pace of technology change can be dizzying, but the real-life barriers to full automation are significant.”

The intrigue: Over-automating can fail, as Tesla CEO Elon Musk admitted in 2018. 

Reducing operational costs has also become less of a reason for companies to automate, Forrester found.

What to watch: Jobs that focus on repetitive physical and mental tasks are most at risk of being replaced by software or robots. 

Workers with creative, social and analytical skills will become more in demand. 

Our thought bubble: There’s constant debate over the net effect of automation — whether it hurts or helps job creation. But the reality is that the world’s been coexisting with modern computing for decades, and machines for hundreds of years. One difference for the future will be defined by the imperceptibility of the relationship. 

Automation moves closer to home

Automation is being set up by a perfect storm of factors.

Illustration of robot hand reaching out to human hand

The number of Americans applying for unemployment benefits last week fell to its lowest level in 53 years, the Department of Labor said Thursday.

Driving the news: Initial jobless claims decreased by 28,000 from the previous week to 187,000. The previous week's figure was 215,000, according to the department. 

The four-week average for new claims fell to 211,750, a decrease from the previous week’s average of 223,250. 

The total number of Americans collecting unemployment insurance the week of March 12 was 1,350,000, the lowest level since 1970, according to the department. 

The big picture: The U.S. government said earlier this month that employers added 678,000 jobs in February and the unemployment rate fell to 3.8%.

The labor force participation rate was 62.3% in February, more than a percentage point below its level two years ago, Axios' Neil Irwin and Emily Peck report.

What they're saying: "Americans are getting back to work at a historic pace, with fewer Americans on unemployment insurance today than at any time in the last half century," President Biden said in a statement on Thursday. 

"This historic progress is no accident: it’s the result of an economic strategy to grow the economy from the bottom up and middle out, starting with the American Rescue Plan." 

"We will continue the fight to lower costs with every tool at our disposal, from making more here in America and rebuilding our supply chains, to lowering costs that have held back Americans for decades, to promoting competition to ensure markets can operate effectively and consumers are protected," Biden said. 

New unemployment claims drop to lowest level since 1969

Initial jobless claims decreased by 28,000 from the previous week to 187,000.

Now Hiring signs are displayed in front of restaurants in Rehoboth Beach, Delaware, on March 19, 2022.

Now Hiring signs are displayed in front of restaurants in Rehoboth Beach, Del., on March 19. Photo: Stefani Reynolds/AFP via Getty Images

Unemployment

The next U.S. jobs report could be a big market-moving event.

Why it matters: The Fed wants to know if the U.S. labor market has made “substantial further progress,” the vague threshold that would give the FOMC the confidence to dial back some of its emergency bond purchase program.

By the numbers: According to FactSet, economists estimate U.S. employers added 756,500 jobs in August, which would be a slowdown from the 943,000 added in July.

The unemployment rate is estimated to have fallen to 5.2% in August from 5.4% the month prior.

What they’re saying: “The softening in employment activity would be consistent with other economic data that have weakened since the surge in COVID case counts due to the Delta variant,” Bank of America U.S. economist Joseph Song says.

“Related to that,” Wells Fargo economists write, “the FOMC is likely to again consider deteriorating public health conditions as a detriment to ‘substantial further progress,’ which removes some heft from the August employment report when it comes to determining the timing of potential tapering.”

In other words, assuming job growth did decelerate significantly in August, then the FOMC may wait until after its Sept. 22 meeting to announce the timing of tapering.

What to watch: The August U.S. jobs report will be released at 8:30am ET on Friday.

Go deeper: The harm the Fed wants to avoid by tapering too early

What economists expect from the August jobs report

The Fed wants to know if the U.S. labor market has made “substantial further progress.”

A man walks by a "Now Hiring" sign outside a store in Arlington, Va.

A man walks by a "Now Hiring" sign outside a store in Arlington, Va. Photo: Olivier Douliery/AFP via Getty Images

Jobs report

Axios Future

A survey of C-suite executives found more than a quarter are considering moving their operations to another state or country.

New survey shows companies are open to moving to cheaper locales

Remote work — accelerated by the pandemic — has made it easier for companies to seek out less expensive regions

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