How to Improve Our Human Capital Crisis
Opinions expressed by entrepreneur Contributors are their own.
Great visions without great people are irrelevant. -JimCollins
Human capital is a measure we use to assess the value of an employee. The idea separates personality and skills. Of course, as we all know, personality has a dramatic effect on a person’s rise or fall within a company.
In previous generations, the incentive of a job was to make a living. It was clear what your expectations were and your responsibilities were well defined. Too many employers today believe that incentive is not measured by the wages you earn, but by your ability to be openly flexible, push yourself, and pledge allegiance to the “organizing family.” The result is not only a staggering pay gap between upper management and everyone else, but also public discontent that has recently boiled to the surface.
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I learned the hard way that you’re not your job. In the United States, we work more hours, on average, than in any other country. Enforced overtime, double pay for working holidays, and a small raise for taking on a whole extra job are all recent tactics that have turned the idea of extra earning into something gross and unappealing. The result is that employees’ incentive to earn has changed to a demand for fair pay with no additional responsibilities and a compliant business environment with regular working hours and respect between colleagues and supervisors. Sounds reasonable right?
As a country, we strayed from sanity years ago. We have become a self-serving nation that has forgotten the values of courtesy, diplomacy and forgiveness. We find ourselves in a vicious circle of employees demanding their duties, bosses firing or fomenting resignations and rebellion. Management fails to create positive change for employees and they lose employee trust and support.
Top executives were replaced more frequently in this country last year than in our recorded history. A record number of employees quit their jobs in 2022. And the hiring market has never been so entropic that recruiters couldn’t keep up with demand, only to find their clients turned down work due to unwieldy employment reports written by nervous HR departments at desperate companies.
Neither workers nor employers appear to be able to communicate their needs effectively. And it does a great disservice to our economy. Why we can’t seem to find a middle ground is not only frightening but disappointing as the middle class shrinks and the gap between wealth and poverty continues to widen.
Our country was founded on liberties to promote good faith between government and one another. Where have we gotten so stray that a person’s worth depends on how many hours they can work in any given day? We have to fix this together. Together we are the reason why we experience this unproductive cycle over and over again.
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And what do I suggest? Communicate. Listen to each other. See where the discrepancy lies and find a compromise. There is always space. Don’t just commit verbally, document it and have the parties execute it in full. When it’s done, you walk away feeling okay, not great, but knowing there has been some forward movement.
The longer we stay on this issue, the harder it is for businesses to recover, which means less work is available, which means higher unemployment rates, which means more crime, which means a drop in property values, which means a sharp drop of residence means what means death of industry in dying cities in red, white and blue.
With a recession in the spotlight, with such high levels of worker and employer dissatisfaction, and an intransigence to change that is plunging us into depression, it is not impractical to predict that outcome when dissenting opinions have diverged so widely over the past two years and a call for accountability, communities have launched witch hunts for justice. The problem is that both sides want it and will not settle for less than they ask for. This is real-time societal ruin, and we are all guilty.
Abolition of the concept of human capital. This word has stayed in our business vocabulary for too long. It may not seem like much, but words have power and I bet it will be a step towards discussion and remedy. If there is only one thing we can agree on at this moment, it is to let go of such a toxic term that is no longer of use to anyone.
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