I am finishing this article on April 15, and I was so delighted to pay my taxes this year. The more you make, the more you are taxed, and if you are 65 or older, the more you pay for Medicare. Our younger workers have no idea what will happen when they turn 65 and want to keep working, but not for an employer full-time or at least more than 50 percent. Those mature workers must pay their own Medicare insurance and the hefty IRMAA fines, thanks to the ACA. I am trying to be polite, Obamacare.
On that note, could employers retain their aging workforce if the mature group knew the true cost of retirement, whether part-time or full-time? In public education, retirees are severely penalized for returning to work full-time. Yes, one of the few professions we cannot outsource easily to another country. However, that day (of knowing the true cost) is coming and has come in many circles. Online education is here to stay and is only growing due to the shortage of teachers. My usual load is 60 to 100 students per class, and my pay was recently cut. No, you cannot make this stuff up.
However, the good news is that AI cannot teach a truck driver to drive, even though the coursework often involves a computer program. They still need to practice driving those 18-wheelers. However, we may not need them much longer with self-driving trucks. Wait until one of them gets on I-10 hauling a load of pipes!
Another field that has been outsourced overseas is some of the larger CPA firms. I know of two Texas groups that were sold once or twice, and now their clients must choose between paying one price to talk to someone in the United States and another, reduced rate to talk to someone not in the United States. This was my first year, and I opted for the U.S. group for about 30 percent more in cost. I teach Ethics to our CPA candidates at one UT System, and I love it. I hope that those outsourced CPA supervisors have received the same training as in the United States.
What about the fee to hire a worker from India and bring them to the United States? The last time I read it was $100,000. So what? Just hire them, let them live in India, and pay them less. Math works for me. I am not picking on India, as many countries would work under the same scenario.
I sound rather sarcastic this month, but I do have hope for the future. Our young people will figure it out. The cost of living is only going to get higher, so deal with it.
I just helped a recent college MBA graduate find an apartment in a safe location in Houston with a commute of less than 30 minutes. The cost for these tiny, “safe” apartments blew me away, and most everything is extra. My friend’s daughter will figure it out, but those apartments reminded me of the one in which my best friend lived in New York City in the 1980s. Did I say tiny?
Bottom line, as we all know: the cost of doing business continues to escalate at warp speed.
As for your employees, you will have to pay them more—so that the online HR system I have been talking about for years looks better. Please email me if you have any questions.
I will admit that, in HR, one thing you cannot fix with an AI program is stupid. That is why you need a compliance officer or at least a very knowledgeable HR leader. No, you cannot easily outsource it. How is AI going to talk to the employees who missed work yesterday because they were in jail? AI can’t handle that—not yet, at least. However, you can put that same employee in front of a camera and discuss the issue with someone in Houston, right? I wrote years ago, and many more times recently, that there is a lot of office space in Houston, and I will add, it rains in Houston. If you are reading this, you know that many large organizations have moved management back to Houston.
The one thing that cannot be moved to Houston is physical labor, and to maintain record production rates in the Permian, you need employees. You need legal employees. However, what your contractors do is not your problem. Or is it? Time will tell. Our current administration says “drill, baby, drill,” but if some data I am reading is correct, we are drilling less in the Permian these days. When I think about the futures market, is there money to be made or lost? Kirk Edwards wrote a few days ago, “You cannot suppress prices, undermine investor confidence, and expect supply growth at the same time. Further, he stated that the short-term price wins driven by policy pressure often create long-term supply problems.
Well, take a beat on that one. Is anyone old enough to remember lines to get gas? I heard, via Facebook chatter, that there might have been a bit of waiting in gas lines last week in Midland. McDonald’s ran vans to get their employees to work years ago. Are you going to run automated vehicles to pick up your employees? Are you going to allow more employees to work remotely? How will you make working for your organization attractive? If your employees can work from home, they will save on automobile costs across the board.
I do not care where you stand on remote work, but it is here to stay. The big caution I have had since remote work became necessary is what is going to happen to relationships? I want to mention again the book I read a few months ago, In Praise of the Office, by Peter Cappelli and Ranya Nehmeh. Wharton School Press is the publisher.
I will close with my thoughts for your employees. Employees stay where they are reasonably happy and enjoy their work. Consider the need to retain your best employees during these times, and do not forget that if this war escalates further, you may lose some of your labor force, and they may lose some of their family and friends.
Michele Harmon
“Your employees are the heart of your organization.” Dr. Michele Harmon is a Human Resource professional, supporting clients in Texas and New Mexico that range in size from five to more than 3,000 employees. Email: micheleharmon1@gmail.com
Leave a Reply