The 12 largest companies in the U.S. cut off more than 100,000 people in the most recent recession during the pandemic, according to a House investigation released on Tuesday. Moving people up the pay scale is a better strategy for helping Americans make ends meet in the fight against inflation than firing them, according to Marty Walsh, secretary of the U.S. Department of Labor.
Many people have been talking about impending layoffs, and according to a new survey, as many as 50% of large firms are considering labor cost reductions as the economy weakens. However, according to Walsh, recent employment growth won't reverse.
"I still think that we're going to have job gains as we move into the end of this year, early next year. A lot of people are still looking at different jobs," he said. "We saw a lot of moving around over this last course of the year. People leaving jobs, getting better jobs, and I'm not convinced yet that we're headed towards that."
In the midst of one of the tightest labor markets in history, Walsh claimed that the political parties handling of immigration - "getting immigration all tied up" - is one of the most serious errors in labor policy the country can make.
The baby boomer generation is expected to retire more quickly in the coming years, and by 2025, the number of high school graduates will have peaked. These factors will limit the size of the labor pool available to the next generation of workers as well as the knowledge transfer between generations of workers.
"We need a bipartisan fix here," Walsh said. "I'll tell you right now if we don't solve immigration ... we're talking about worrying about recessions, we're talking about inflation. I think we're going to have a bigger catastrophe if we don't get more workers into our society and we do that by immigration."
A few weeks ago, shares of gig economy companies like Uber and Lyft were negatively impacted by a proposed DoL rule on independent contractors. Some Wall Street analysts don't anticipate the rulemaking to have a substantial impact on the rideshare businesses because it is still being reviewed and is open to public comments. One of the vocations he did suggest that will probably be covered overlaps with the business concepts of Uber, Lyft, and DoorDash.
"We have plenty of businesses in this country, like dishwashers and delivery drivers in areas like that, where people are working for a business that other employees in that business are employees, and they're labeling them as independent contractors," he said. "So we're going to look at this. We're in the rulemaking process now. We're taking in the comments now, and we'll see when the comments come in what the final rule looks like."
