White-Collar Sweatshop details the indignities of working in corporate
America, where workers are paying the price for increased competition
Atlantic Monthly
June 7, 2001
Compared to their peers thirty years ago, America's 80 million white-collar
employees are working longer hours, for the same pay and fewer benefits, at
jobs that are markedly less secure, and for corporations that regard firing
whole ranks of employees as a way to post paper gains and so win Wall
Street's favor. The long arm of the job has reached into employees' homes,
their nights, their weekends, and their vacations, as technology designed
to make work less onerous has made it more pervasive. America's insecure
white-collar workers are victims not of poverty, like the blue- and
pink-collar workers Barbara Ehrenreich writes about in Nickel and Dimed
(2001), but of progress. They are, Jill Andresky Fraser writes in
White-Collar Sweatshop: The Deterioration of Work and Its Rewards in
Corporate America, "suffering the unwanted ... consequences of the nation's
recent economic boom." Her new book raises the question of whether the
deterioration of white-collar work is more cause than consequence of that
now-fading boom. Is a eupeptic stock market a sign not of new wealth
creation but of a redistribution of resources from workers to owners? Or,
rather, from workers to their own pension funds? "We are all devouring
ourselves," an art designer for a major publisher told Fraser. "We all own
stock, and as stockholders, all we care about is profits. So we are the
ones who are encouraging the conditions that make our work lives so awful."
Call it cannibalistic capitalism.
Fraser, the finance editor of Inc. Magazine, spent four years talking to
white-collar workers in industries ranging from banking to high-tech, and
White-Collar Sweatshop thoughtfully synthesizes the personal testimony
gained from her interviews and from Web sites like
"disgruntledemployees.com" and "nynexsucks.com" with big-picture research.
According to Juliet Schor's The Overworked American (1992), "If present
trends continue, by the end of the century Americans will be spending as
much time on their jobs as they did back in the nineteen twenties"before
the eight-hour day became standard. A software-industry professional
explains the Darwinian dynamic behind the twelve-hour day: "The long hours
aren't because we want to outshine everybody; we want to keep up with
everybody." A recent Lexus ad boasts, "Sure We Take Vacations. They're
Called Lunch Breaks." But even lunch is becoming a luxury: 39 percent of
workers surveyed by the American Restaurant Association say they are too
busy to take a lunch break. What Fraser calls "job spill" is "the dirty
little secret behind many a corporation's thriving bottom line." Half of
all households own pagers and half of those who own pagers have been beeped
during a vacation. There are now cordless telephone sets that allow your
company to call you while you are taking a swim. And, Fraser reports,
there's a "new type of floating chair capable of supporting people who want
to combine a swim with work on their laptop computers." Back at the office,
the average employee must cope with 200 e-mails every day, being careful
not to use "alert" words like "union" or "boss" in
e-correspondence"investigator" software may be watching. (Job-related
stress from intra-office competition, long hours, and intrusive technology
costs the economy an estimated $200 billion annually.)
Overwork and job spill would perhaps be bearable if one were being well
paid for it. But white-collar men earned an average of $19.24 an hour in
1997, just six cents more than their fathers made in 1973. Back then the
average new college grad earned $14.82 an hour, "which adds up to $1.17 per
hour more than his 'gold'-collared counterpart was paid in the
high-pressure corporate world twenty-five years later." The rise of
"contingent employment" has also lowered wages. Contingent work, Fraser
notes, is the human equivalent of "just-in-time" manufacturingthe arrival
of production materials only as and when needed. Benefits? From medical
care to pension coverage to vacation time to Christmas bonuses, "perks"
have steadily declined since 1980.
What is to blame? The short answer is price competition. The post-war era
can now be seen as the golden age of oligopoly. A few large companies
dominated each of the major industries, competing on product quality and
image"You'll wonder where the yellow went when you brush your teeth with
Pepsodent!"but not on price, the race-to-the bottom form of competition
that can put companies out of business. They tolerated the union wage35
percent of workers were unionized by the late 1950sas a cost of doing
business they could pass on to consumers, who, in an exclusively national
market, had no choice but to pay up. In the twenty-five years after 1945,
the GNP doubled, wages nearly doubled, and America's corporations
flourished as never before or since. This "American High," as one historian
has called it, ended in 1973, when the Arab oil embargo quadrupled the cost
of oil overnight. The embargo was a symbol of the emergence of a world
economyEurope and Japan having recovered from the war and the oil-producing
countries newly conscious of their power over the industrialized West.
Whereas imports accounted for less than 10 percent of the US market in
cars, steel, and televisions and radios in 1961, twenty years later they
accounted for 26 percent of the car market, twenty-five percent of steel,
and 60 percent of televisions. Altogether, imports were competing with
upwards of 70 percent of US-made goods by 1981. World-famous corporations
melted in the crucible of competition. "Of the country's 500 largest
manufacturers in 1980, one in three had ceased to exist as an independent
entity by 1990," Michael Unseem writes in Investor Capitalism (1996).
"Companies built to last like pyramids," Peter Drucker reflected in the
early 1990s, "are now more like tents."
In his book Only the Paranoid Survive (1996), Andrew Grove, the CEO of
Intel (which Fraser depicts as a Silicon Valley sweatshop), brings the new
corporate insecurity home. "When companies no longer have lifelong careers
themselves, how can they provide one for their employees?" That logic is
hard to argue with, and that may be why most white-collar workers have
accepted their fate, albeit bitterly, resenting the fact that they have to
pay for bad business decisions made by executives whose pay has risen an
average of 70 percent since 1990.
Fraser ends with a list of remedies for the white-collar sweatshop that,
though laudable, don't quite answer Grove's question. Companies were once
good to their white-collar employees to keep out unionsand white-collar
membership in unions has traditionally been lowbut Fraser suggests that
veterans of the white-collar sweatshop may be receptive to unions now. "In
an economic environment in which even the American Medical Association has
decided that it makes sense to organize doctors (at least those who are
salaried employees of HMOs and hospital corporations)," she writes,
"anything seems possible." She cites industry predictions that the
financial-services industry will be unionized within the decade. She also
sees unfathomed potential in the power of socially conscious investment
vehicles to change corporate behavior. "I believe that people could use
their savings and retirement dollars to punish negative workplace
practices, without suffering a financial setback," she writes. Funds like
the Citizen Global Equity Fund Family that only invest in companies that
meet certain environmental standards have outperformed the S & P 500 Index.
Why couldn't decent treatment of employees be a standard for investment as
well? The irrationality of cannibalistic capitalism argues against its
longevity.
But the problem of competition remains. Insecure companies make for
insecure employees. John D. Rockefeller invented corporate capitalism as an
escape from the atomistic price competition of Adam Smith. "Only a
professor," Rockefeller said, could believe that great companies, with high
sunk costs, could compete in this way. Corporate capitalism sought to
replace the invisible hand of the market with the visible hand of
management. Some economists see the mega-mergers of the past few years as
gropings for the stability of global oligopoly, for the return of the
visible hand. Without system-wide stability accompanied by a global New
Deal that would protect society from the power of global corporations, the
conditions of work ably documented by White-Collar Sweatshop are likely to
only get worse.
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