In the face of a 20,000-employee walkout, Google recently said it would end mandatory arbitration of sexual misconduct claims, a decision that has since spread to private unicorns as Airbnb said it will follow suit. Uber and Lyft already did so last year.
Most people might think of the walkout in terms of youthful idealism, a consequence of an industry dominated by socially aware Millennials. But I see the foundation of the most powerful labor movement in U.S. history if techies ever decided to unionize.
That won’t happen anytime soon. Tech firms would vehemently oppose any such move. And workers might not really see such a need, given the pay and perks Silicon Valley lavishes upon them.
But think of the power such a union would yield, thanks to two unique aspects of the U.S. economy right now.
Shortage of talent means lots of leverage
First, technology accounts for an enormous part of the U.S. economy and will only grow bigger. CompTIA, the world’s largest technology industry association, estimates technology accounts for $1.6 trillion, or about 12 percent of the $19.4 trillion U.S. economy.
Software and the Internet touches every industry in today’s digital economy. A strike at a Ford manufacturing plant wouldn’t come anywhere close to the kind of disruption workers at Google or Facebook could inflict on the economy and society in general.
The second factor is the severe shortage of high-tech workers. The reason why tech firms pay so much for workers is because companies fiercely compete for a small pool of talent.
A study by recruiting firm Korn Ferry estimates the United States could face a deficit of 6 million workers by 2030. Tech companies in particular could lose out on $162 billion worth of revenues every year unless the industry finds more high-tech workers.
“The impact of the talent crunch is so significant that the continued predominance of sector powerhouses is in question,” the report said. “For instance, the United States is the undisputed leader in tech, but the talent shortage could erode that lead fast.”
The lack of supply gives tech workers enormous leverage over their employers. During a strike, companies in industries with excess labor could easily find replacements. By contrast, tech firms are finding it hard to hold onto the workers they already have, never mind replace them should they strike.
A historical precedent
Come to think of it, a union representing tech workers may not be so far-fetched. For one thing, there is some historical precedent.
In 1973, a series of strikes by computer workers in Great Britain closed down two dozen computer centers and disrupted the government’s ability to collect taxes.
“Even though many of these workers were women, and limited in their pay, promotion, and work opportunities due to sexism, their proximity to the literal machinery of government gave them a great deal of power,” Marie Hicks, author of “Programmed in Equality,” recently wrote.
“Like factory workers before them, high-tech workers used the power of the strike to force their employers to give them better working conditions and to assert their power within the new digital economy,” she wrote. “Computer operators, programmers, and even the lowly punchers, whose data-entry work had been seen as unimportant, were recognized as crucial after the strikes.”
Last February, a group called the Tech Workers Coalition protested the decision by Lanetix to fire software engineers who were trying to unionize.
“When workers organize collectively in a union, they can win a voice on the job, better conditions, and fairer compensation in an exceedingly profitable industry,” the group said. “They can also combat inequalities within the workforce that often affect women and other underrepresented groups who can face isolation, and whose only other recourse is an HR department that puts the boss’s interest first.”
If it walks like a union and talks like a union…
In Silicon Valley, there are no shortage of issues that concern workers: ethics, environment, diversity, sexual misconduct. Despite those six figure salaries, affordable housing remains a big problem for employees who live in Palo Alto and Mountain View.
Union or no union, tech workers at the very least have shown a remarkable ability to organize themselves and win concessions. For example, Google employees successfully pushed the company to withdraw from bidding on contracts to develop artificial intelligence technology for the military.
And getting 20,000 workers to walk out at the same time is no small feat.
Despite Google’s decision to eliminate forced arbitration, organizers of the walk made clear that they were far from satisfied. They are also demanding an employee representative on the board of directors, protection for contract workers, and the elevation of the company’s chief diversity officer.
“In addition the company must address issues of systemic racism and discrimination, including pay equity and rates of promotion,” the organizers wrote in a blog post. “These forms of marginalization function together to police access to power and resources. And they all have the same root cause, which is a concentration of power and a lack of accountability at the top.”
DISCLAIMER: This blog does not contain a complete analysis of every material fact regarding any issuer, industry, or security. The information contained in this blog has been obtained from sources we consider to be reliable; however, we cannot guarantee the accuracy of all such information.
None of the information contained in this blog represents an offer to buy or sell, or a solicitation of an offer to buy or sell, any security, and no buy or sell recommendation should be implied, nor shall there be any sale of these securities in any state or governmental jurisdiction in which said offer, solicitation, or sale would be unlawful under the securities laws of any such jurisdiction.
Any securities offered are offered by SharesPost Financial Corporation, a member of FINRA/SIPC. SharesPost Financial Corporation and SP Investments Management are wholly owned subsidiaries of SharesPost Inc. Certain affiliates of these entities may act as principals in such transactions.
Copyright © SharesPost, Inc. 2018. All rights reserved.