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Does it matter if your boss is rich?
This is a question I’ve rarely thought about over the years, mostly when non-rich friends have reported unexpected misunderstandings with wealthier bosses.
There was an Australian woman whose clearly confused new manager listened to her explain how she had to leave work at a certain time every afternoon to pick up her children from school before asking her: “Why don’t you just get a babysitter?” She explained that, unfortunately, that would be difficult considering the salary his company pays her.
Another friend who could afford a property just miles from office surprised her wealthier boss, who lived closer to work, by revealing how much money she had saved on train tickets by working from home during the pandemic.
Then there was the CEO who called his team into his spacious home for a morning meeting and ushered them into what turned out not to be the dining room, nor the kitchen, but the “breakfast room,” an area entirely devoted to breakfast that’s larger than a suite. of most of his guests, none of whom had heard of such a room before.
I was reminded of all this when I came across some recent international research that helps explain why these moments happen – and why they may become more common.
In developed countries across Europe, Asia and North America, there are more and more wealthy workers separated from the less affluent.
Within industries and within individual companies, there has been a “dramatic decline in the exposure of the highest earners to the lowest earners,” the authors say. A big separation paper published at the end of last year.
Consider France. In 1994, 1 percent of French people with the highest incomes worked in places where 9 percent of their colleagues belonged to the same group with the highest incomes. By 2019, that 9 percent share had almost doubled to 16 percent.
In the Netherlands in 2006, 10 percent of those with the highest incomes worked where about 25 percent of their colleagues had similar incomes. By 2020, that percentage has grown to almost 30 percent.
The higher the class of earners, the less likely they are to mix with the lowest paid workers.
There are many reasons why this is happening, starting with the decline in industry jobs. Factory life brings workers together with supervisors, engineers, managers and executives. It is different within a bank, insurance company or software developer.
Outsourcing or offshoring jobs such as data entry or payroll clerk roles deepens the gap, removing portions of lower-income workers from the office.
As well as the rise of digitization, which automates low-paid jobs. This trend highlights the reason why wealth segregation could increase.
Research for the paper began many years ago, says co-author Professor Halil Sabanci of the Frankfurt School of Finance and Management.
This was before ChatGPT and other types of advanced AI were unleashed on the workplace. Sabanci believes that it makes sense to expect artificial intelligence to accelerate the segregation of wealth that digitization has already initiated.
All this could have profound political consequences.
Sabanci and his colleagues suspect that the elite’s isolation at work may already have helped breed resentment among poorer workers who read or hear about the lives of the top earners but rarely see or meet them.
“This situation could increase feelings and experiences of being left behind, ignored and misunderstood,” they write, adding that this in turn could help fuel Trumpism and other forms of populism in Europe.
The polarization of voters between wealthy capitals or coastal cities and struggling hinterlands has certainly been a striking feature in a range of recent elections, from the 2016 UK Brexit vote to the US and French presidential battles.
In 1988, Jean-Marie Le Pen’s 15.6 percent vote share in the Paris region was about the same as the 14.4 percent he received elsewhere, some of the paper’s authors write in earlier research.
Thirty years later, support for the right-wing populist leader’s daughter, Marine Le Pen, has fallen to 12.5 percent in Paris but has risen to 27 percent elsewhere – almost double her father’s vote share.
This change is of course not caused only by the increasing separation of the highest earners from the rest of the workforce. But it is easy to see that this segregation could have spurred change, and may even accelerate it further.
