Social Science LABOR ASSIGNMENT 2

INTRODUCTION

The Best of All Possible Worlds of Work

The 5:29 P.M. commuter train to Scarsdale is jammed: usually it's * standing-room-only for the half hour it takes to reach the

upscale suburb from New York City's Grand Central Station. During the ride, Gemma,1 a marketing executive, phones her

office for messages not once but twice, returning as many calls as possible in quick succession from her cellular phone. She keeps her voice low, tries to conclude the calls quickly,· too many of them, after all, and her seatmates are apt to send irritated looks her way. But she makes them anyway, despite a longing to doze off: "It's the only way I can leave my office most days at five o'clock and get home to have dinner with my family." Her fellow commuters share the strategy, it seems, judging from the frequency with which they too pull out their cell phones, laptop computers, or yellow lined legal pads.

Despite the crowds and the phone calls, the ride passes fairly quickly. Most evenings, Gemma makes it to her home by a quarter past six. But her workday is not over. By seven-thirty or so, once dinner is done, it's back to those phone calls.

While her children wrap up the last pages of their homework or settle down to watch some television sitcoms, Gemma again checks her voice mail, taking the time to respond to as many calls as necessary. Sometimes there are faxes to handle: sent from clients or colleagues to a home machine perched in a spare room that dou­ bles as an office. Her husband, an investment banker, works there

4 WHITE-COLLAR SWEATSHOP

as well during the evenings, usually at the family's personal com­ puter, where he sits, sometimes for hours, writing or amending doc­ uments relating to one of his prospective deals. As the evening winds to a close, clients may phone too: his and hers each have the family's home telephone numbers as a matter of course. "When a client needs you, they need you," she sighed, in an early conversa­ tion with me.

If boundaries exist between Gemma's home and work lives, they're hard to detect. "I never relax. I honestly feel that I never relax," she confessed. "When I'm at the office, I never go out to lunch. All that I'm aimed at, when I'm at the office, is getting work done. I don't have time for anything else. If I need a pair of stockings, I don't have time to get it. I don't have time for anything, period."

She and I were sitting in a crowded Manhattan restaurant, eating quickly, talking quickly. She was doing me a favor by squeezing me into her chock-full workday, taking the time to talk about all the time she didn't have. "It's gotten worse and worse." She gestured with her fork to emphasize her words. "I fantasize every day about doing more things for myself. I want to work out. I can't. I need phys­ ical therapy. I can't get it. You work so hard, rush home to be with the family. Then you're short with them. Even though that's where you want to be, you're too tired at night. You get testy, exhausted."

Like many of the men and women I interviewed during four years of research for White-Collar Sweatshop, Gemma inhabits a stress- ridden and precarious universe. By most traditional measures, her career is a smashing success, encompassing as it has a steady string of promotions, salary increases, a big-ticket move to the suburbs. Yet she lives her life feeling like a member of the walking wound­ ed. "The neck," she almost moaned the words, massaging her neck, unconsciously, at various points in our conversation. "I live with pain in my neck from all the stress and the phone." Again she motioned with her fork. "I'm on the phone all day—very stressed out. I have no memory. It's the stress." She paused as she carefully chose her words. "The thing is, I still like what I do."

Nick does not know Gemma. They don't work in the same indus­ try, nor do they live in the same state. Yet they share many of the same feelings about their work lives, as they struggle to cope with

Introduction 5

a corporate world increasingly defined by overwork, stress, and—at more and more companies like Nick's—patterns of underreward.

Like Gemma, Nick also still "likes" what he does, although he is quick to admit that he is no longer certain how much that's worth. "My job is extremely challenging—that's not the problem." A mid-level financial executive at one of the country's most suc­ cessful telecommunications companies, he has held on to his post through more than a decade's worth of corporate acquisitions and divestitures, layoffs and mergers. "I am who I am. I have made a sig­ nificant contribution to this company. I feel proud of that." He paused, then added, his smile a wry one, "It's very hard to say that it was all for nothing."

Nick and I have spoken on numerous occasions, while he has attempted to steer his career along a steady path, despite the tumul­ tuousness and unpredictability of the corporate environment he inhabits. His sense of humor was quick; his observations bleak: "People are to the point where they're keeping their lists, keeping journals of things they can use against the company when their time comes," he told me once, over burgers at a diner near his office. "There's no loyalty, no faith." Perhaps the biggest surprise for him was that he could fall into this same category. "When I started out, I thought I could stay forever. This seemed like such a great place to be."

How things change. He and his wife recently put their four-bed­ room Colonial, complete with two lushly landscaped acres in West­ port, Connecticut, on the market: not because they plan to move even further upscale but because Nick has come to the conclusion that his career and financial prospects basically have dead-ended— although he is still only in his forties.

"I recently concluded a project that had tremendous bottom-line value for the company and its shareholders," he recalled. "I really made an impact on the company's profitability. But when it came time for my annual review, I got a completely pathetic raise, which I had to be thankful for because it was zero point six percent higher than everyone else got." Maintaining what was basically the status quo was scarcely an option for Nick and his wife, since they had been meeting their monthly expenses by dipping into the family's

6 WHITE-COLLAR SWEATSHOP

savings for more than a year now. But even more painful than the decision to downscale their lifestyle was the behavior he felt com­ pelled to adopt at the office: "I had to swallow my pride and say, thank you." His voice dripped with sarcasm. "Just suck it in and say thank you, while management sits and watches the stock price and exercises another fifty thousand stock options."

Year after year of cost-cutting, lagging raises, declining benefits, and increased workloads have taken their toll on Nick, as they have on white-collar workers throughout corporate America. Think of him—indeed, it's the way he views himself—as the victim of a kind of corporate water torture, which has slowly and painfully con­ sumed much of the energy and enthusiasm he once brought to his work life. "You have no control. It's ultimately a humbling experi­ ence to realize that you could move mountains and it wouldn't make any difference."

Although the newspapers he reads during his hour-long com­ mute are full of reports about the United States' booming job mar­ ket,2 Nick has yet to apply for a position elsewhere. "Why move somewhere else? I figure all these companies are the same. You hear stories from people like me all the time. Everyone on the train has got his or her own story to tell." He sat silently for a moment, then added, "I went home the day I got that raise and made the decision then and there that it was time for our family to start downsizing too."

And then there's Leonard. Leonard isn't downsizing. He is simply counting the days—

although there are still thousands of them—until he can finally retire and leave the emotional and ethical stresses of his work life far behind him. Like Nick and Gemma (neither of whom he knows), he too is a corporate success, with a career that has spanned impor­ tant positions at three major high-technology companies. His six- figure salary and benefits are all that he ever could have wanted. But for some time now, the pressures accompanying his twelve-hour workdays and managerial responsibilities—which have included supervising numerous rounds of layoffs during the past decade— have left him feeling more like a survivor than a star.

Introduction 7

"The philosophy now is you have to squeeze more and more out of people. I have to do more and more with less." An ex-marine, he isn't one to complain, but he made it clear to me that he has given up on any hope of a better end in sight. "Earlier this year, they laid off a hundred people in my division. The philosophy was, you prob­ ably have a hundred people who probably aren't up to par."

He chuckled, the kind of laugh that conveyed just how unfunny the situation at his office has become. "I had a phone call one day telling me, you have to lay ten people off. There was no discussion. It wasn't appropriate for me to say no or yes." Again the chuckle. "We laid those people off, so now I'm in litigation with some of them. They're mad. I understand that. But here's the reality." He paused. "If I don't do it, I’m gone. That's clear."

Early on, Leonard himself was a staunch supporter of his compa­ ny's restructuring efforts. In the first of several conversations between us, he emphasized that he was still proud of the part he had played in his employer's initial efforts to redefine and even elimi­ nate jobs, all in the interests of strengthening a once-weak business and raising the standards of the workforce. But now, he noted, "We do this year after year. We squeeze. We squeeze. People are starting to feel expendable. But if you try to argue, then you're not stepping up."

Another conversation, still the themes were the same. Although Leonard had called me from his car phone, I could hear the disgust in his voice along with the static. "Layoffs are not good. People keep telling me, 'Len, there's a contradiction here. You tell us that things are better than ever. But the layoffs and cost-cutting keep happen­ ing. Does this mean that at any time, no matter what, it could hap­ pen to me? Anything could happen to me?"' Leonard acknowledged that he was at a loss as to how to answer the men and women who report to him. "Look," he told me, "the last time, I was blindsided myself."

Again, that humorless laugh. "In a way, I feel too old to start again, but too young to hang it up. The only way I can protect myself is by trying to outperform everybody else. That means working harder and harder. I do it for one thing—the money. And

8 WHITE-COLLAR SWEATSHOP

if I can just hold on long enough, I'll be able to retire early and be finished."

Has there never been a better time to work in corporate America? A new business-world order exists, spawned and nurtured by

tumultuous changes during the 1980s and 1990s. By the dawn of the twenty-first century, the United States could boast of remarkably low unemployment, high corporate profits, and labor markets so tight that signing bonuses were reported to be almost common for everyone from new college graduates to teachers and even civil ser­ vants.3 "In some parts of the country, just about anyone who can breathe and is ambulatory has a job—and in some cases, they'll make exceptions," was the way one Conference Board economist put it.4

Although wild stock swings suggested that the extraordinary bull market of the past two decades might finally be exhausted, the pro­ longed years of buoyant equity growth had yielded enormous sums of capital, ripe for investment in America's business future. By the turn of the millennium, the United States' economy was in uncharted heady waters, with venture capital investments, initial public offerings, and stock price-to-earnings ratios all at record lev­ els, and almost every week, it seemed, another off-the-charts cor­ porate merger guaranteed to create a new global superpower. Although some industries were experiencing painful contractions, many others were thriving.

Within this environment, one might assume that the rewards and challenges of work would likewise be unparalleled, especially for the United States' skilled and experienced white-collar work­ force, nearly 80 million men and women strong.5 Yet behind the era's high-flying statistics are dismal workplace realities that many readers of this book will recognize all too well from their own lives.

Overwork is epidemic, for men and women whose job demands keep increasing, not because of career advances but because of a cor­ porate environment that has depended upon squeezing, as Leonard would say, more and more work out of fewer people with fewer resources. For today's white-collar staffers, the balanced and secure

Introduction 9

nine-to-five work lives of their parents' generation belongs to a utopian past, as they struggle to fulfill job demands that require them to work after dinner and during lunch hours, the way Gemma does, or on Saturdays and Sundays, in between the innings of their children's Little League games, during summer or winter vacations, while waiting on line at movie theaters, driving their cars virtually anywhere, or on countless other occasions as well. Signs of round- the-clock overwork are inescapable; during a late August afternoon ride in a rented pedal boat, after a game of miniature golf, my fami­ ly and I shared a Long Island pond with a woman who was peddling her two young daughters around, all the while speaking to her office via cell phone.

The new corporate era has depended in large part upon tighter and tighter cost controls, layoffs, efficiency-driven mergers, and endless workplace cutbacks. And so, many of today's overburdened white-collar jobs carry with them diminishing financial rewards— whether these take the form of raises that fail to keep up with grow­ ing workloads and inflation, or eroding health care benefits, or shrinking pensions, or disappearing vacation days and holidays.

Long-term financial stability has disappeared, within a business world in which layoffs and other cuts have been as rampant during periods of economic prosperity as during downturns.6 And the cor­ porate ax keeps falling faster and faster: by the first quarter of the year 2000—yet another in a long fine of robust seasons for layoffs— one of every five "downsized" Americans had spent less than twenty-four months in their jobs before getting fired.7

Faced with the harsh new realities of the contemporary work­ place, men and women find themselves squeezed at all ages and stages of their career paths: during their twenties, as many are forced to choose between the growing pool of temporary jobs and perma­ nent posts that offer little upward mobility in companies commit­ ted to churning their workforces,· during their thirties and forties, as they struggle to balance the voracious demands of corporate employers with those of children and aging parents; and during their later years, as—despite expectations that they will be rewarded for all their years of hard work—men and women often learn instead

10 WHITE-COLLAR SWEATSHOP

that their higher salary levels and extended tenure in the workforce leave them increasingly vulnerable to job loss, with few options except self-employment or contingent labor. In some especially bru­ tal industries, such as Wall Street and the high-tech sector, this career "kiss of death" now hits people as young as in their forties.

The overwork, stress, and insecurity of today's workplaces has been exacerbated, not relieved, by the proliferation of high-tech equipment—laptop computers, cell phones, electronic desk calen­ dars, beepers, portable fax machines, Palm Pilots, and more—that help people try to keep up with growing workloads while also mak­ ing it impossible for them to fully escape their jobs and relax. New technologies, meanwhile, facilitate intrusive efforts by employers to monitor everything from their staffers' comings and goings to computerized keystrokes and mouse taps, e-mails sent and received, and personal productivity on a weekly, daily, or even hour- by-hour basis.

Work life was not always this demanding and unrewarding. Once, the nation's largest corporations were viewed by white-collar Americans as the source of jobs worth dreaming about: offering security, comfortable working conditions, the prospect of a bal­ anced work and home life, and a wide range of financial benefits. During the early decades following World War П, successful com­ panies and their staffers shared the fruits of economic prosperity as new, relatively paternalistic practices governed workplace rela­ tions and helped create long-term bonds between employer and employee.

These early postwar employment strategies fell into disrepute after a variety of economic problems threatened the global preemi­ nence of the U.S. economy during the 1970s. Thanks to compliant government policies and aggressive intervention by Wall Street, the 1980s ushered in a tumultuous era of corporate reinvention accom­ panied by workplace decline. Along the way, the rules and rewards of the business world changed: although people's job demands and stress loads kept ratcheting ever upward, the only way they could share prosperity's rewards was through the stock market, rather than their paychecks and benefit packages.

Introduction 11

Throughout the 1990s, thriving companies like Intel and Microsoft, corporate giants like Citigroup, AT&T, and IBM, and struggling companies like Levi Strauss and Disney were among a long list of those committed to harsh new management strategies. Public relations campaigns conducted inside and outside the corpo­ rate workplace aimed to convince Americans that deteriorating job conditions were essential in order to fuel the nation's thriving econ­ omy and soaring equity markets.

Yet evidence abounded that "sweatshop" practices demoralized employees and destabilized workforces, and may well have weak­ ened many businesses as they faced ever tougher global challenges. By the turn of the millennium, it also seemed clear that—in its pre­ occupation with short-term profits and ephemeral stock market gains—the culture of overwork and underreward had exacted a painful toll not only upon the men and women employed by the United States' largest companies but upon their families, vital civic structures, and the nation's society as a whole.

As a financial writer, I have spent much of the past two decades reporting on the corporate trends that underlie workplace change: the downsizings and productivity drives, the megamergers, public policy adjustments, globalization campaigns, increasing emphasis on shareholder rewards, investor activism, and much more. Yet when I first embarked upon this project, back in 1996, one paradox kept nagging away at me: how to reconcile the buoyant optimism of the chief executives, business leaders, and management consul­ tants I interviewed regularly—as well as the widespread confidence embodied in what then seemed to be an inevitably rising stock mar­ ket—with the often bleak workplace stories and comments I was hearing from my other sources, all those men and women outside the executive suite?

They told me about ever-increasing workloads, time pressures, and other job stresses,· unrealistic employer expectations; declining levels of career and financial security. Less emotional attachment to the workplace. Less time and energy for the family. Although times were good, attitudes like these reflected a pervasive pes­

12 WHITE-COLLAR SWEATSHOP

simism about the workplace: a sense that its daily norms and long­ term prospects had changed in a host of negative ways that were not going to disappear anytime soon.

Were these tales of overwork and exhaustion, mistrust and despair, simply the ramblings and complaints of small numbers of disgruntled workers, those who just could not keep up with the fast­ paced program, as American businesses continued to reinvent and reposition themselves to thrive within the twenty-first-century global economy? And even if they were indicative of larger trends— a darker side, if you will, of the new and invigorated U.S. economy— did these personal costs matter much at all, so long as our corporations themselves kept getting stronger?

To answer these questions, I have spent four years trying to understand the ways in which the demands and rewards of work have been changing within corporate America,· why these changes occurred; and what their effects have been, and will continue to be, upon the work and home lives of people employed by large corpo­ rations, as well as upon those companies themselves and the greater U.S. economy.

During my research, I conducted in-depth interviews, often on repeated occasions, with men and women of all ages on various rungs of the corporate ladder. Their jobs ranged all the way from entry-level through management positions, and their areas of expertise ran the gamut from finance to marketing and sales, engi­ neering, administrative support services, and everything in between. They represented all the major industries upon which the U.S. economy is based, including computer technologies, banking, publishing, Wall Street, retailing, telecommunications, and much more.

These men and women constitute a broad spectrum of white-col­ lar workers across corporate America: new college graduates, Gen­ eration Xers, baby boomers, and others who are older still. Most hold a full-time job, but others juggle more than one job, or work as contract employees or short-term temporary staffers. Some were out of work (or, as many liked to say, currently "consulting”). Some opted for early retirement.

Introduction 13

My confidential conversations with these men and women took place in coffee shops, fine restaurants, and family kitchens; during after-hour, weekend, and early morning telephone calls; and via electronic communications. With the help of various business orga­ nizations, employee networks, and self-help groups, I hosted round­ table discussions and workshops organized around the themes of my research, all with the goal of broadening my interview and knowledge base to include the broadest possible range of people, jobs, corporations, and industries.

The course of my research coincided with the growing involve­ ment of more people (and more different kinds of people) with the Internet, and I expanded my activities accordingly. Besides regular­ ly visiting a host of websites and chat rooms that focus on work- related issues, I posted descriptions of my project in a variety of Internet sites, complete with "hyperlinks" that could connect inter­ ested people directly to my e-mail address. Eventually, I hosted my own discussion groups on the Internet as well. In some cases, these electronic sites hooked me up with cranks and kooks: no surprise, I'm sure, to anyone who regularly "surfs the Net." In far more instances, however, the Internet put me in touch with men and women whose work experiences had raised for them many of the same questions I was asking. A few were so anxious about possible leaks to their employers that they insisted our conversations be con­ fined to electronic letters, often remarkably long ones. In the vast majority of cases, however, we followed up our initial Internet con­ tacts with in-depth conversations either in person or by telephone.

These conversations ranged far afield. I spoke to working men and women about the course of their careers; their goals, key achievements, and disappointments,· the ways that their work and personal lives had intertwined; and about the evolutions and revo­ lutions they had witnessed within their companies and industries. Above all, I have been interested in change: how people's work lives differ from what they used to be, or what people expected them to be, or wanted them to be. When did the rules and rewards of their workplaces shift, I'd ask them, and what corporate decisions or actions were responsible? How do they feel about their work lives

14 WHITE-COLLAR SWEATSHOP

today, and how have those feelings changed, along with their work environments, over the years?

The past two decades have been a period of great transformation for corporate America: change that takes on a far different cast when looked at, not from the floor of the New York Stock Exchange or a chief executive's suite, but from the wide ranks of a company's white-collar workforce. My sources and I discussed their lives "before and after" the seismic changes that rocked IBM, AT&T, and the Baby Bells, the big U.S. banks, the publishing industry, retailers, all manner of high-tech companies, and more. Since few people's careers have remained static in our rapidly shifting economy, I have been able to track some as they changed jobs or employers, and have followed others while they coped with corporate mergers or down­ sizings. Perhaps also inevitably, some of my sources lost jobs, some­ times high-powered ones, during the years in which I interviewed them.

Their recollections were illuminating. I heard about "the B.U.M. from hell," a notorious "business-update meeting" at semiconduc­ tor manufacturer Intel. That was when staffers learned about a for­ mal quota that had been instituted per department to single out layoff candidates. (In Intel-speak, they're sometimes known as the "slower-thans.") It was a manager himself who gave this "B.U.M." its ominous nickname, according to one engineer who attended the meeting, and it was a manager "who came right out and told us that Intel is not going to be a place where you can work until retirement. "

Sometimes, in my sources' recollections, a single moment, a comment, a sentence in an otherwise insignificant office memo­ randum provided an unforgettable glimpse into the dismal work­ place realities that many white-collar workers have grown to take for granted.

An executive vice president who managed to survive numerous rounds of layoffs at Lehman Brothers surprised me when she described her most painful memory of the experience. It wasn't the difficulty of maintaining an upbeat facade before potential clients, all the while waiting for an ax to fall on her own neck each time new cuts were announced. Nor was it the way she felt as she walked past all those empty cubicles and offices in a midtown Manhattan sky­

Introduction 15

scraper that increasingly came to resemble a ghost town. No, for her, the lowest—and most personally intrusive—moment came in a hallway conversation with the managing director who was her supervisor. He instructed her to "smile more often so that people would know just how grateful she was to still have her job."

One woman, a manager at one of the nation's largest and most successful financial services firms, told me about how she had been so overloaded and understaffed that she had been forced to work through the entire night before her wedding. The image that stayed with her, years later, was of the company's escalator, which was moving up during the early morning hour in which she was finally heading down. She wasn't complaining, she emphasized; she just could not shake the memory. Sometimes, in retrospect, she could not even believe it had happened.

If, as I will argue, the personal costs have been vast during this period of business and economic tumult, there have also been par­ allel business costs that the corporate community does not yet fully grasp: costs that may eventually handicap America's large compa­ nies in their quest to achieve profitability and competitive preemi­ nence. Despite the gorgeous glow cast by a long-lasting bull market upon much of the nation's economy, there are already, as I will demonstrate, incipient signs of trouble in many of the companies and industries that have based recent growth strategies on harsh new management techniques. Absenteeism, stress-related medical costs, high employee turnover rates, and poor morale are wide­ spread; the flight of capital and manpower to smaller entrepreneur­ ial ventures has also become apparent. In intensified global competition—or in an economic downturn in which American cor­ porations must turn to their employees for the competitive edge that will enable them to survive and thrive—many will find that they have alienated and exhausted the human capital that was once one of their greatest resources.

Does the notion of a white-collar "sweatshop" seem incongruous, implausible—perhaps even offensive—when linked with the image of work life within America's largest and best-respected corporations?

16 WHITE-COLLAR SWEATSHOP

Sweatshop workers are exploited, often illiterate, impoverished, powerless. The United States' white-collar workers are certainly anything but. They're educated, sometimes very well educated. They enjoy comfortable lifestyles, often extremely comfortable lifestyles. They've got plenty of options. Could they really have any­ thing to complain about, especially during an economic period as vibrant as these past years have been?

Then again, for many of the readers of this book, especially those who work in large and demanding corporate environments, the term "sweatshop" may not seem so surprising at all. For them, the more pressing question may be, is there a way out of our contem­ porary business culture of overwork, stress, insecurity, and under­ reward—both for themselves as individuals and for the nation at large?

ONE

“The Pace Was Insane": Less Time, More Stress

" FBI he whole theme of your book is my life," one IBM veteran in * her early forties told me during the first of a series of conversa­

tions we shared. Catherine described to me her steady progression from a junior

position at "Big Blue" back in the early 1980s through a fairly con­ tinual string of promotions into the ranks of management during the next decade. Early on, she had been identified as a strong per­ former and, as she put it, "placed on the management fast track." While still in her twenties, she worked twenty-hour days. "It was pretty unbelievable" is the way she recalls it now.

One two-year assignment kept her on the road, visiting IBM's customers, five days a week. "I'd only go home on the weekends. That was just accepted. It was part of the culture. You just did it— kept working and traveling at that kind of pace." Since her husband also worked for the company, he didn't complain; fortunately, his travel schedule was lighter than hers, which allowed them to main­ tain a semblance of a home life.

Then she was promoted into a line-management position. The good news was, she was on her way up and no longer needed to maintain that relentless travel schedule. The bad news was, her responsibilities included a regular rotation during which she was placed "on call" twenty-four hours a day, on a shift that lasted a week at a time.

17