Outsourcing labor to specialist firms has become common. For instance, most companies arent hiring janitors any more, but instead outsourcing it to a contractor. We have unfortunately incentived this through things like the 401k 'highly compensated employee' designation, the difficulty in firing, and firms' desire to avoid reputation damage. The downside is ofcourse that janitors no longer have upward mobility into the firm they clean for since they didn't actually work for that firm.
When I was at Google, we had hundreds of people in the building working, but not for Google. They had a different coloured badge. They didn't get the perks (cafeteria, the guest lectures, massages, etc). And to be frank--you didn't even need to look at their badge to tell the difference. You could tell by whether they smoked or not, how many teeth they were missing, and unfortunately their race as well.
Thanks! I'm from half-way across the world, so my intuitions don't matter for shit, but intuitively, this makes a lot of sense.
What do you think are the implications for policy? For instance, would something that could bring down intra-firm inequality make inter-firm inequality worse, because they're a drag on productivity/competitiveness?
Outsourcing labor to specialist firms has become common. For instance, most companies arent hiring janitors any more, but instead outsourcing it to a contractor. We have unfortunately incentived this through things like the 401k 'highly compensated employee' designation, the difficulty in firing, and firms' desire to avoid reputation damage. The downside is ofcourse that janitors no longer have upward mobility into the firm they clean for since they didn't actually work for that firm.
When I was at Google, we had hundreds of people in the building working, but not for Google. They had a different coloured badge. They didn't get the perks (cafeteria, the guest lectures, massages, etc). And to be frank--you didn't even need to look at their badge to tell the difference. You could tell by whether they smoked or not, how many teeth they were missing, and unfortunately their race as well.
Thanks! I'm from half-way across the world, so my intuitions don't matter for shit, but intuitively, this makes a lot of sense.
What do you think are the implications for policy? For instance, would something that could bring down intra-firm inequality make inter-firm inequality worse, because they're a drag on productivity/competitiveness?