Executive Summary

The Invisible Hand:
Creating the Workplace of the Future

Lawrence Perlman
Chairman and Chief Executive Officer of Ceridian Corporation

August 1998

We are in the midst of a fundamental shift in the U. S. to a market-wide labor shortage. The evidence is particularly clear close to home. Minnesota is first among U. S. states in the participation of women in the workforce (70 %) and second in employment for men (81 %). And unless we begin to see an influx of people who are moving here for the weather, employers of all sizes will need to place a high priority on hiring and retaining people.

The downside of a labor shortage is that it may well limit business formation and expansion, and eventually could cost jobs. The upside: it is doing more to create a diverse, inclusive workforce than all the legislation, political posturing and solemn declarations by corporate chieftains over the past thirty years combined. Not since World War II have employers been so willing to think creatively about recruiting and retaining employees. Some signs of the times:

• Hennepin County offers senior citizens a chance to work off all or some of their real estate tax bills in exchange for work in its operations at minimum wage.

• Civic leaders in Dubuque, Iowa, launch a "come home, all is forgiven" campaign to lure its far-flung sons and daughters back to the labor-starved city. Christmas letters from the mayor, inserts in alumni magazines, recruiting tables at high-school reunions, and the ubiquitous website are all part of the program.

• Amy Gage, columnist for the Pioneer Press, asks readers to send in ideas for finding and keeping workers, with a mock suggestion of padlocking the door to keep the people you already have.

Many companies are trying a "grow your own" strategy. Businesses that reach out to welfare recipients and offer training, mentoring, transportation, child care, management support and the requisite longer-term commitment may be pleasantly surprised by their return on investment in these new workers. The robust economy, with the attractions of pay, benefits, flexibility, and the promise of growth has already pulled nearly four million people off welfare and onto payrolls.

Another "home-grown" strategy is to form a solid partnership with a local school. A company and its employees who participate in school partnerships – offering scholarships, mentoring, intern-ships, job shadowing, career counseling and other kinds of collaboration with students, teachers, parents, the principal and staff – earn a long-term advantage in recruiting and retaining workers who have benefited from the partnership. Such alliances can take many forms to achieve a variety of objectives. For example, Comdata, Ceridian’s transportation services business headquartered in Nashville, works with a local college to offer courses on–site, often taught by Comdata managers. The school gets income, facilities, teachers and a predictable supply of students; the employees advance their personal goals while the company reaps the benefits of a better-prepared workforce.

If companies want skilled, experienced, reliable, flexible people who are as eager for work as for money, they may find what they need among their retirees. Travelers Insurance has a formal program that has between 125 and 150 retirees from a pool of 700 on the job at any one time. Days Inn recruits retirees for ten percent of its reservation department and a company spokesperson says they show up, they are on time, they care, and they are fine role models for the work ethic sometimes lacking in younger workers.

Attracting workers from the X– and Y–generations requires an approach of its own. These independent, well-educated young people want meaningful, satisfying work, but within the context of rich and fulfilling lives outside of their jobs. They have their priorities straight.

The key to attracting and retaining workers across the whole spectrum is flexibility and the recognition that it is a seller’s market. Companies need to tailor benefits, hours, work arrangements, job design, learning opportunities, development options and compensation to meet individual needs.

Today, work–life programs and philosophies are central issues at every point in the employment process. One of the great joys of my life in business has been to participate in the flowering of ideas to make possible both a productive career and a full life of the mind, heart and spirit. As these concepts have become manifest in the workplace, we are beginning to see what people who are encouraged to bring the fullness of their beings to work can do in terms of creativity, innovation, productivity and imagination. Labor market dynamics have made the business case for work–life programs and a diverse workforce more compellingly than all the rhetoric we have endured for the past two decades. What was always the right thing to do has become the smart thing to do.

The invisible hand of the market has writ: the only sustainable competitive advantage for companies is the people who work there. The unprecedented economic growth of recent times is due in part to the explosive growth of knowledge and the transformation of work from muscle power to brain power. With this vast and growing knowledge base, we are just beginning to comprehend the working relationships and organizational fabric that will define the successful business enterprise going forward.

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