May 30, 2022

Ten Reasons for the Great Realignment

This was going to be a response to another thread, but I'm curious to see what people here believe about the Great Realignment, with my own thoughts about the primary reasons behind it.

1. People in the 55-65 age group went into semi-retirement during Covid, realized they don't miss the stress and have some opportunities that don't involve the 9-5 grind.
2. People of all ages that are not convinced (with reason) that Covid is over, and given a choice between going to work in a job with no health care and crappy wages vs. simply staying away from work and finding WFH equivalents, much prefer doing the latter.
3. Better wages and WFH is also reducing the available "full time" workers.
4. Gas prices are becoming too high. Most delivery and related service companies do not compensate for gas, which again makes working at too low a wage no longer viable.
5. Birth rate peaked in 2000 and started declining mildly until 2008, when it began a long, fairly steep decline that is still underway. People usually start working between 16 and 21. This means that we're now about 6 years into the first leg of the decline and its impact on people starting in the workforce. 2008 + 16 = 2024, which means that we enter the second, more significant, decline in two years. The 16-25 age group makes up the bulk of the unskilled service market. Companies that make their profits largely by exploiting these workers are going to find their business models collapsing within the next two years, especially as many of them are staying with their parents longer (into their late twenties) where there is comparatively little NEED to work for many of them.
6. The cost of housing and vehicles has risen so dramatically that getting married is no longer a real option until couples are into their early thirties. The flip side of this is that 20-somethings aren't buying cars, and as such are less mobile than they used to be. Take out the cost of house and vehicle and reduce or share the cost of food, and people can get by with remote work even if they pay less. You're also seeing much more communal living, with multiple people sharing a house or apartment,
7. Not all (or even the majority of) WFH gets reported to the IRS or gets picked up by the BLS.
8. WFH also makes side hustles feasible, where a single person might end up taking two or more jobs because they have better control over their time and revenue streams. This way they can make more collectively than they would make with a RTO near full time job, which often involves wage theft for hours not clocked for one reason or another. Given that, RTO jobs are simply no longer as attractive as they once were.
9. Women are leaving the workforce in greater numbers than men, and are also shifting to WFH in greater numbers. Since women have traditionally been paid about 70 cents on the dollar compared to men, this is showing up in expected wages being forced up in general.
10. Finally, there's just the corporate fatigue factor - people are recognizing that the game is stacked against them, especially if they are not wealthy to begin with - unfair wage imbalances, limited career paths, toxic bosses, abusive co-workers, lack of control over hours, arbitrary hiring/firing, etc - and they are simply refusing to play the game anymore. Ironically, I think that the digital economy helps with that - fewer people need fewer physical things, especially big-ticket items, and this manifests as a calculus where you realize that you can be productive and can survive doing what you prefer rather than simply making other people wealthy at your expense.

I'm including a poll with this. Please comment or clarify it you have additional information you want to add.

In the last two years, have you: