MIT Sloan Management Review Article on Getting Ahead of Rising Labor Costs

Widespread labor shortages and rising labor costs over the past two years have been blamed on short-run factors associated with the pandemic: government assistance and workers’ reluctance to go back to jobs where they still face health risks. But what if something bigger is at play here that is indicative of longer-term changes in the labor market that would require a fundamental rethinking of compensation strategy?

A survey of trends in labor costs and business model transformation over recent decades shows that we may be at a tipping point in terms of workers’ preferences and willingness to act according to those preferences to achieve the pay and working conditions they believe they deserve.

About the Author

Alec Levenson (@alec_levenson) is a senior research scientist at the University of Southern California’s Marshall Center for Effective Organizations. His research and consulting work optimizes organizational performance through work design, analytics, and strategic talent management.

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