The New Deal at Work

Cappelli, a professor of management at the Wharton School, provides an excellent summary and analysis of the fundamental changes in the relationship between employers and employees wrought by the postindustrial economy. Presenting industry trends over the past 15 years, Cappelli shows how, as companies increasingly based their business strategies and organizations on market forces, employee job security has effectively disappeared in the frenzy of cost-cutting and downsizing. Often, a job exists only so long as market conditions allow an employer to keep a worker. In addition, companies no longer perform many of the functions they once did for employees (e.g., prospective employees may have to obtain their own new-skill training in order to be employable). Most interestingly, Cappelli also warns that the new deal at work poses problems for employers, pointing out that, with the tightening of the labor market since 1996, companies have had to confront the thorny task of hiring and retaining committed, skilled workers. Thorny does not mean insoluble, Cappelli argues, and he presents many workable strategies (golden handcuffs policies, team building and joint ventures, among them). The new deal has triggered new attitudes among workers as well, with workers committing to an occupation rather than to an employer. Most of Cappelli's discussion concerns the remarkable adaptations the market has made in response to the new deal in the workplace, but he also warns that an unchecked mania for optimal short-term market efficiency may shortchange questions of fairness and social equity. (Mar.)