The Work Force is Changing

McKinsey & Company recently published an article that explores the changes in the U.S. workforce. The bottom line of the article is that the pandemic gave people time to contemplate their personal and work lives, and a large percentage of Americans have decided to not go back to the kinds of jobs they held before the pandemic. McKinsey is calling this the Great Attrition, where millions of people have decided to retire early, take sabbaticals, start their own businesses, or start a new career.

This is reflected in a lot of statistics. There were a record 11.3 million jobs open at the end of May. After a huge number of people quitting their jobs in 2021, the percentage of people still quitting jobs is up 25% over historical trends.

McKinsey says that the current labor shortage is mostly for jobs that can be classified as traditional. People who are willing to take traditional jobs do so for the benefits, job titles, and the chance of long-term career advancement. The article postulates that the number of people willing to take traditional jobs that put the company first is dwindling. McKinsey doesn’t see that many big companies are changing the way they are recruiting – and this means there is a disconnect between what companies and potential employees are looking for.

Companies are mostly filling traditional jobs by luring people away from other companies, which is resulting in wage inflation but is not addressing the overall underlying number of people willing to take jobs they think will be unfulfilling.

McKinsey suggests that the long-term solution for companies to fill open jobs is to find a way to attract the 40% of workers that McKinsey classifies as non-traditionalists. That’s going to mean a big shift in the way that many businesses operate. Consider the following chart from the article that explains the difference between traditional and non-traditional workers.

The first column represents people who quit jobs between April 2021 and April 2022 but then took another traditional job. These folks look like traditional workers in that career development and advancement, adequate compensation, and meaningful work top the reasons why they took the new job. For the most part, these folks moved on to a company that offered them a better chance for career advancement. The one difference between this list and a list from five years ago is that even traditional workers now highly value workplace flexibility.

The second column represents the factors that non-traditionalists say might lure them to accept a traditional job. Topping the list as the most important reason is workplace flexibility, followed by good pay and meaningful work. The chance for career development and advancement is listed seventh for the reason to consider a job, below having a safe work environment.

The conclusion that can be drawn from this chart and the rest of the article is that building a long-term career at one company is no longer important to many people. People who are looking for long-term advancement will tolerate a work environment with an annoying boss or long hours if they think it puts them on the path toward advancement. But the growing number of people who view jobs untraditionally will likely bail on a company that doesn’t have a great work environment.

This is an important issue in our industry since telcos, cable companies, and other ISPs tend to offer traditional jobs with set work hours, decent wages, and okay benefits. At least historically, ISPs have not been known as places with a flexible work environment. Technicians and customer service reps work set hours. The business office is open at set times. Career advancement is possible, but it’s often a slow path that rewards staying with a company for many years until the bosses above retire.

The article suggests a number of different strategies that companies are starting to consider for filling open positions. One is to reach out to people who retired from a company to see if they can be lured back to work. Companies are looking for ways to become more flexible by allowing people to work from home or periodically take extended vacations.

One thing is for sure; this genie is not going back into the bottle any time soon. In an economy with more job openings than people to fill them, workers are currently in the driver’s seat. And unfortunately for many companies, that means they are not taking traditional jobs.

Big Future for Telemedicine?

According to a report just released by McKinsey & Company, we are on the verge of seeing a major shift to health care from home. The report says that as much as $265 billion in annual fees to Medicare and Medicare Advantage could shift to homes by 2025.

We’ve already seen the start of the trend towards telemedicine. The spending on telemedicine was 38 times higher in 2021 compared to 2020. Most of that shift is obviously due to the pandemic. The report suggests that 2025 in-home medical care will increase to three to four times the 2021 level.

The report cites several changes in the healthcare industry that are contributing to the trend for more in-home healthcare:

  • 40% of patients who have used telemedicine say they expect to keep using it in the future. It’s a big burden on working families to try to get to the doctor’s office during the workday, and telemedicine makes it easier for many families to seek health care.
  • There are new technologies that make it easier to deal with remote patients. As an example, 20% of all medical practices in April 2021 were using devices that allow for electronic patient monitoring.
  • There has been a huge investment made in the digital healthcare market. Venture capital to support new digital healthcare companies was $29.1 billion in 2021, up from $14.9 billion in 2020 and $8.2 billion in 2019.
  • There is a rapidly growing industry that brings health care to the home. I probably don’t pay as much attention to this industry as I should, but this is the first time I heard the term Care at Home providers. These are health care professionals that visit patients at home.

The report points out that there are still a lot of changes to be made for the industry to fully adopt the care at home health care model. For example, insurance companies must recognize and reimburse in-home care at the same payment level as for doctors and hospital care.

The report suggests that the biggest change will come from the general public, who will insist on in-home care if that is an option. Very few people want to trudge to a health care facility for repetitive treatments like dialysis, infusions, or simple consultations.

The report predicts that more physician groups will adopt care at home after seeing case studies of the effectiveness of treating patients at home.

Even as long as twenty years ago, I remember seeing predictions that telemedicine would be one of the first ubiquitous outcomes of the spread of broadband. I can remember hearing a lot of predictions of how broadband-enabled technology would enable seniors to live unassisted until later in life. It’s been obvious for that whole time long that this is something that many people want, but it has never materialized in any major way. Physicians and insurance companies have been reluctant to try telemedicine until the pandemic forced the issue.

We’ve come a long way with broadband in twenty years. The latest estimates are that over 87% of homes have a wired broadband connection, and 95% of adults have cell phones. Maybe telemedicine has finally arrived – we aren’t going to have to wait long to test the McKinsey prediction.