As a non-American I'm always surprised at how quickly people are fired there. I cannot imagine such a severe action been taking in any country I've worked in, thanks to robust workers rights.
As a European, I was also surprised to find out that the US has a very low unemployment rate compared to what I am used to. Then I moved to the US, and on a few occasions found myself in a position to be able to consider hiring a lot of people very quickly (and hence taking on a substantial amount of risk, both for the company and those employees). I can definitely tell you that if the US had the same workers rights as Europe, I wouldn't have hired nearly as many people - not even close, less than half for sure. In one instance it was the wrong call to hire so quickly, and all other instances it was the right call and generated value for both sides.
I know that in Europe you can let people go if the company is experiencing financial difficulties and all that, but there's no question that the commitment to any new European employee you hire is higher than in the case of their US counterpart. And it would be foolish to assume that by increasing the decisioning barrier there wouldn't be some kind of an action-reaction happening in the market. As an employer, you never have 100% certainty that a new initiative will pay off - there's always this doubt in the back of your mind. Well, if the cost of failure is higher in one case than another, you are simply going to initiate fewer bets and will also give fewer people an opportunity to benefit from them (and those bets that you do initiate, you will approach more carefully and with fewer people).
Does this explain the entire gap in unemployment? Of course not. But I really do think it is a factor. So what's better - a bulletproof job that fewer people have, or a more risky proposition that more people can get access to? I don't think I have an answer to this, but I certainly don't think that the answer is always in increasing the decisioning barriers.
This perceived gap in unemployment needs some actual sources.
Unemployment in northern Europe is lower than in comparable places in the US with the same labour rights.
I can imagine unemployment in Southern Europe to be higher, but I am curious what you think you are comparing.
Here is something else to think about: it's safer to hire Americans because they will work 60 hours a week, never take a sick day, won't get pregnant and even if you give them vacation days they won't use them. So they are about 3/5 of the price of your typical European employee. A much better value proposition.
In return some of this will burn them out and put them on edge. This will likely have cultural, political and social consequences. If only we could give our American friends the sleep, reflection and family time they so much deserve.
It is part of the reasoning. Another part is that Europe generally has better unemployment benefits and health care not tied to employment. This drives people to take worse jobs in the U.S.
In addition you have to ensure you look at comparable statistics on who is counted as unemployed. This is toften tied to receiving unemployment benefits or being able to work etc. so different statistics might count based on different criteria.
I’ve found most private English firms have no difficulty letting people go if they need to.
It seems a different story for public orgs like schools and government positions. But private companies have a lot more freedom than some in here have been suggesting.
It’s likely a different story elsewhere in Europe though. There’s a lot of countries with their own laws in Europe
I think the other thing is that the US can hire people for very cheap (like 2$/hour) with the idea that maybe the actual customers can contribute to the worker's salary to make it up. Often you need to get another job to reach a living wage. It's a great way to enslave people and get good unemployment numbers.
there might be a correlation to how quickly companies form, projects start, and innovation progresses in America (entrepreneurship) compared to Europe, and how the robust workers' rights might figure into making companies reluctant to hire a batch of workers that they can't easily terminate.
Any such correlation wouldn't be down to causation imo. I've always assumed the American attitude of "Do first, ask forgiveness later" was the more likely candidate for many of Silicon Valley's success stories.
It's also worth noting that there's plenty of innovation happening in Europe too.
edit: I'll add a little more detail as to why I don't agree with your theory: in Europe you can still make employees redundant relatively easily. So if a company hires 100 employees then realises it's not cost effective, it can easily make 80 of them redundant. The catch is you cannot rehire for the same roles (basically you cannot make someone redundant to get around firing them), but given the purpose of your thought experiment was to cull staff after initial growth, redundancy works perfectly fine here.
Europe also has such as thing as short term contracts. Not contractors, though we obviously have that too, but FTEs that are hired for 6 months / 1 year rather than indefinitely. I'm sure America has this too.
So there isn't really any need to hire people with the intention of firing them shortly after. In fact any company that does this would get a pretty bad reputation pretty quickly. That's true for America too.
I've also seen people fired at short notice in the UK too so it's not like it can't happen in Europe even with greater worker rights. Heck, I was unfairly fired from one job -- but I hated the job anyway so it wasn't worth my time taking the company to court. Instead I used that energy to find a job I did like.
It's the at-will employment where employer or employee can cancel the relationship without cause. In ENG you have crazy lengths of time to give notice like 2-3 months. Not a very pleasant experience for the employee. You also see attempts by European employers to AVOID taking on permanent workers. E.g. in ENG it used to be 2 years of contracting required a FTE contract but they'd cancel the contract three months shy. You also have terrible zero hours contracts in ENG.
I think that many companies prefer to fire their employees immediately in exchange for money, typically what the employee would have been paid if he stayed for the notice time.
It is expensive, but often better than dealing with a disgruntled employee for 2 months.
Honestly I could see this happening in Europe, mainly when such high profiles are involved.
Even with robust workers rights this still happens a lot. If the company wants you out they'll get their way. Employees can always dispute at the employment court, but it's overwhelming so few do so and companies leverage that.
It's crazy to me as someone who believes in mutually consensual relationships in all things (including business and trade) that doing something last week is implicit requirement that one does the same thing next week, and that withdrawing consent to additional future trade is seen as a "severe action".
"A job" is really a fictional abstraction. Every day one works is additional services-for-money. Either party should rightfully be able to say "no thanks, that's enough, tomorrow is a new day" at any time.
This is a fine mentality when you're running a lemonade stand, but gets complicated when you're talking about a person's livelihood in a country where something like 60% of people are living paycheck to paycheck. If ONLY we lives in a society that valued itself over the profits of a few individuals.
Notice how the USA is the top country in the world for getting ahead. If you want to work hard and become rich, that's your spot. Places with "robust workers rights"? Not-so-much.
I disagree with this actually - the effective savings rate is generally lower in the US compared to a lot of countries with "robust workers rights" if you're working in the US you end up losing a lot of wealth to problems that are generally societally insured elsewhere in the world.
> If you want to work hard and become rich, that's your spot.
Maybe, maybe not. I'd argue there are far more who tried and failed than who succeeded, but I don't know if that ratio of success is better or worse than in other countries today (yes, today - not when the US economy was booming relative to other countries, or when immigration was easy, or in the early days of Silicon Valley, or back during the Gold Rush(es) etc).
In any case, though, I would argue this argument applies to a narrow slice of the population, namely those whose main goal is to get rich. Not everybody wants to "work hard and become rich". Not everybody wants life to be a competition to get ahead. Plenty of people are not deeply invested in a career and simply want to work 40h/week for a decent salary and still be able to afford a decent life.
Others feel a calling to a profession that will generally not make you rich, but is still valuable to society. Case in point: teachers. Extremely valuable to society and extremely badly compensated in the US. If I wanted to be a teacher, I'd much rather be in most European countries than in the US.
I never understood it either. It's usually the wrong, honest, helpful employees that get fired first.
I'm not a loyal employee. I do most jobs just good enough to get by, and alway looking for a angle to extract more money out of an organization. (It was easier before being surveiled with cams). I always like a few coworkers, and we become friends, but despised the corporation, and everyone in charge.
aerosmile|4 years ago
I know that in Europe you can let people go if the company is experiencing financial difficulties and all that, but there's no question that the commitment to any new European employee you hire is higher than in the case of their US counterpart. And it would be foolish to assume that by increasing the decisioning barrier there wouldn't be some kind of an action-reaction happening in the market. As an employer, you never have 100% certainty that a new initiative will pay off - there's always this doubt in the back of your mind. Well, if the cost of failure is higher in one case than another, you are simply going to initiate fewer bets and will also give fewer people an opportunity to benefit from them (and those bets that you do initiate, you will approach more carefully and with fewer people).
Does this explain the entire gap in unemployment? Of course not. But I really do think it is a factor. So what's better - a bulletproof job that fewer people have, or a more risky proposition that more people can get access to? I don't think I have an answer to this, but I certainly don't think that the answer is always in increasing the decisioning barriers.
ralfn|4 years ago
Unemployment in northern Europe is lower than in comparable places in the US with the same labour rights.
I can imagine unemployment in Southern Europe to be higher, but I am curious what you think you are comparing.
Here is something else to think about: it's safer to hire Americans because they will work 60 hours a week, never take a sick day, won't get pregnant and even if you give them vacation days they won't use them. So they are about 3/5 of the price of your typical European employee. A much better value proposition.
In return some of this will burn them out and put them on edge. This will likely have cultural, political and social consequences. If only we could give our American friends the sleep, reflection and family time they so much deserve.
johannes1234321|4 years ago
In addition you have to ensure you look at comparable statistics on who is counted as unemployed. This is toften tied to receiving unemployment benefits or being able to work etc. so different statistics might count based on different criteria.
tdeck|4 years ago
unknown|4 years ago
[deleted]
laumars|4 years ago
It seems a different story for public orgs like schools and government positions. But private companies have a lot more freedom than some in here have been suggesting.
It’s likely a different story elsewhere in Europe though. There’s a lot of countries with their own laws in Europe
mensetmanusman|4 years ago
baby|4 years ago
fsckboy|4 years ago
hnlmorg|4 years ago
It's also worth noting that there's plenty of innovation happening in Europe too.
edit: I'll add a little more detail as to why I don't agree with your theory: in Europe you can still make employees redundant relatively easily. So if a company hires 100 employees then realises it's not cost effective, it can easily make 80 of them redundant. The catch is you cannot rehire for the same roles (basically you cannot make someone redundant to get around firing them), but given the purpose of your thought experiment was to cull staff after initial growth, redundancy works perfectly fine here.
Europe also has such as thing as short term contracts. Not contractors, though we obviously have that too, but FTEs that are hired for 6 months / 1 year rather than indefinitely. I'm sure America has this too.
So there isn't really any need to hire people with the intention of firing them shortly after. In fact any company that does this would get a pretty bad reputation pretty quickly. That's true for America too.
I've also seen people fired at short notice in the UK too so it's not like it can't happen in Europe even with greater worker rights. Heck, I was unfairly fired from one job -- but I hated the job anyway so it wasn't worth my time taking the company to court. Instead I used that energy to find a job I did like.
sys_64738|4 years ago
smartician|4 years ago
GuB-42|4 years ago
refurb|4 years ago
willhinsa|4 years ago
† Or never fired, like Eric Schmidt!
themdonuts|4 years ago
bagacrap|4 years ago
richev|4 years ago
sneak|4 years ago
"A job" is really a fictional abstraction. Every day one works is additional services-for-money. Either party should rightfully be able to say "no thanks, that's enough, tomorrow is a new day" at any time.
teawrecks|4 years ago
philovivero|4 years ago
munk-a|4 years ago
Valkhyr|4 years ago
Maybe, maybe not. I'd argue there are far more who tried and failed than who succeeded, but I don't know if that ratio of success is better or worse than in other countries today (yes, today - not when the US economy was booming relative to other countries, or when immigration was easy, or in the early days of Silicon Valley, or back during the Gold Rush(es) etc).
In any case, though, I would argue this argument applies to a narrow slice of the population, namely those whose main goal is to get rich. Not everybody wants to "work hard and become rich". Not everybody wants life to be a competition to get ahead. Plenty of people are not deeply invested in a career and simply want to work 40h/week for a decent salary and still be able to afford a decent life.
Others feel a calling to a profession that will generally not make you rich, but is still valuable to society. Case in point: teachers. Extremely valuable to society and extremely badly compensated in the US. If I wanted to be a teacher, I'd much rather be in most European countries than in the US.
inter_netuser|4 years ago
hyakosm|4 years ago
hellbannedguy|4 years ago
I'm not a loyal employee. I do most jobs just good enough to get by, and alway looking for a angle to extract more money out of an organization. (It was easier before being surveiled with cams). I always like a few coworkers, and we become friends, but despised the corporation, and everyone in charge.
But I'm never fired.
I'm usually shocked over the person they fire.