In the Wake of the Great Resignation, Can Employees Realistically Expect Any Good Jobs for 2024?

Dr. Zeynep Ton.

Dr. Zeynep Ton is a Professor at the MIT Sloan School of Management. Her book, The Good Jobs Strategy: How the Smartest Companies Invest in Employees to Lower Costs and Boost Profits, draws on fifteen years of research to show that the key to offering good jobs to employees, great service to customers, and superior returns to investors is combining investment in employees with specific operational choices that increase employees’ productivity, contribution, and motivation.

She is also co-founder and president of the Good Jobs Institute, a non-profit whose mission is to help companies thrive by creating good jobs and to redefine what it means to run a successful business. Prior to MIT Sloan, Dr. Ton spent seven years at Harvard Business School, where she received her Doctor of Business Administration.

Q. By mid-2023, the voluntary quit rate had more or less returned to what it was in 2019.¹ With 2023’s turbulent job market, employees have rightfully been stressed. As healthcare/products manufacturers announced the third-most job cuts (after tech and retail) in 2023 with 58,560—a 91% increase from the 30,626 cuts announced in 2022²—how can this vertical’s C-Suites craft an environment where employees are focused on creating value for clients versus worrying about retaining their jobs?

Dr. Zeynep Ton: Smarter leaders recognize the criticality of building an environment that enables their teams to be set up for success. These C-Suite executives invest heavily in their teams and design their work for higher success. The Good Jobs Strategy is a high-performance system in which companies have high expectations of their employees and employees have high expectations of their company. Based upon my research, there are four common themes of these successful playbooks:

1. Focus and simplify: Strive for fewer meetings and concentrate actions on reducing the complexity of the entity. These simple steps will help employees center on the fundamentals and have a laser focus on what is most important for existing clients and prospective ones.
2. Standardize and empower: Identify processes where standardization can free up time for employees where they currently waste unproductive cycles. Then empower them to make appropriate decisions.
3. Cross train: Invest in your employees’ upskilling of new competencies which can help them to better understand and serve clients’ needs as well as enhance each individual’s personal career development.
4. Operate with slack: Finally, once these three themes have been deployed, trust your employees by giving them enough time to perform their jobs well. It’s suboptimal to target 100% efficiency in a system with variability. Variability can come from customers, internal operations, mistakes, and differences in productivity level of employees. Still, operating with slack might seem counterintuitive to the operational efficiency training that some of your readers might have taken. 

One analogue that can help change this mindset is Costco. Do you ever notice how there are many employees at Costco and that when inevitable lines do begin to queue up, suddenly a new register line opens up to help process checkouts?

Costco’s C-Suite has leveraged such principles as providing slack since they recognize the importance of serving the customer well, trusting and empowering their frontline. And it has been a win-win situation for Costco’s customers, shareholders,³ and especially their employees who make an average of $26/hour versus their peers at $16/hour.⁴

Q. With lean 2024 budgets already being the norm at many of these firms, what are three practical next steps for C-Suites to consider in the coming months?

A. Dr. Ton: First, pressure test your understanding of what your clients’ prioritized needs are and if/how your organization’s people, processes, and technologies are addressing them. Candid client feedback on your firm’s value proposition, or lack thereof, can help shape how best to focus and simplify one’s operations.

Second, invest time to meet with your frontline and ask for honest feedback to shape course corrections. Don’t just do surveys but meet in person. Costco’s CEO Jim Sinegal used to spend 200 days on the front line since he believed that such interactions were the best use of his limited bandwidth to create positive change for the company.⁵

Finally, challenge your own assumptions around the potential value that the rank and file employees bring to an organization. The conventional wisdom in service organizations has been that “bad” frontline jobs—with low pay, unpredictable schedules, and few opportunities for advancement—are necessary to compete. But Costco’s C-Suite and a handful of other firms understand the potential when they demonstrate deep care for their employees.

By deep care, I’m referring to those companies which are paying enough compensation for employees to be able to have control over their lives.⁶ These are not non-profit organizations as they set high expectations, design the job for high productivity, and provide a working environment where employees have the potential to be accountable for their actions and success.

This reciprocity arrangement has helped smarter organizations like Costco design work for humans, which is ever so important given the rapid changes with evolving technologies like generative AI. Despite the projected patent cliff for life sciences firms that was just recently highlighted,⁷ there are good jobs which can not only be preserved but also created for this vertical. Smarter C-Suites will tap into available playbooks like Costco and other resources (Good Jobs Institute - Help companies thrive by creating good jobs) to help refine their respective strategies.

About the Author

Michael Wong is an emeritus board member of the Harvard Business School Healthcare Alumni Association.

References

1. Brown, Courtenay, The Great Resignation is over, quit rates return to pre-pandemic levels, Axios, May 31, 2023
2. Challenger, Gray, & Christmas, Inc., Challenger-Report-December-2023.pdf (omscgcinc.wpenginepowered.com), January 4, 2024
3. https://finance.yahoo.com/quote/COST?p=COST&.tsrc=fin-srch
4. https://www.cnbc.com/2022/10/18/best-employers-in-the-world-forbes-survey.html
5. Relihan, Tom, “How Costco’s obsession with culture drove success,” MIT Sloan School of Management, May 11, 2018
6. https://www.goldmansachs.com/intelligence/goldman-sachs-talks/zeynep-ton.html
7. https://www.cnbc.com/2024/01/28/big-pharma-merck-bristol-myers-jj-prepare-to-lose-revenue.html#:~:text=That%20refers%20to%20when%20a,can%20access%20more%20affordable%20options.