Employers Must Be Flexible or Face Worker 'Revolt': Deloitte

Will they come back to the office, is to what degree, under what schedule? Lots of different models out there being discussed. Erica Volini, Gloomal, Global Human Capital leader at Deloitte, joins us on the phone from Phoenix. Erica, thanks so much for joining us. I'd love to get your thoughts about what your clients are telling you about how they plan to bring their employees back to work as this economy gradually reopens. Thanks that. I think the keyword is flexibility.

UM employers are thinking very carefully about how to set a flex way of working. We're seeing this across the board. UM. The question is the degree of flexibility that's going to be offered, whether it's a finite you can come back, you know you work from home X number of days a week, or whether it's going to be ultimate flexibility, do your job as you think it's best to do it.

I think are the questions that are out there. But there is definitely a recognition that workers want more choice in terms of how they do their work, um, and where they do their work. I'd love to be in Phoenix to tell you the truth, Erica. Do you see so many people talked about at least a move to Florida, going down to Texas, to Arizona, to California. Do you see big business hubs actually spreading out a little bit? I think there's a recognition that geography, especially in a

world of more remote work, becomes less critical. Right. Office proximity is not a defining factor in terms of whether you can get a job. I think we're seeing migration to other other areas, um for sure. But there are tax implications, UM. There are benefit implications right that employers have to work through, and I think we're gonna see that over the next few months lash years as employers try to figure out exactly how much flexibility they want

to give. But the benefit is huge. Think about the ability to tap into labor markets that have historically not been available to these organizations. UH, fresh labor pools UM individuals who want to be reskilled and retrained and be able to enter into the to the workforce in different types of jobs. So I think we will see UM much more flexibility in organizations saying you don't have to be geographically close to where the office is. What are

you hearing from employee ease erica? Are they going to revolt if they're told to come back into the office after, you know, twelve plus months of working from home. I think revolts is a strong word, and I don't think it's necessarily just about can I work from home or can't I. I think what workers are going to say is you need to be caring for me. You need to focus on my well being. You know, our global Human Capital Trends report at Deloitte is showing us that

well being is the number one trend. UM. Workers are expressing they need their well being cared for. UM. They need to know they have flexibility to deal with what they have in their lives, and so what they're asking for from employers is understand my needs and give me the ability to flex as I need to to be able to make those meet those needs and also be productive at work. And I think what we've learned in

the past year is that is possible. Um, you know, with the right um leadership, with the right programs and pray placed, the right policies, and frankly, with a degree of trust and empowerment for workers. And I think that's the main theme we're hearing from workers right now. What do you think we're gonna see in terms of female employees? I mean, um, I've heard so many stories about bankers, women who are paid a lot, and they were forced

to decide between childcare and going into work. They chose childcare and gave up those big paychecks. I myself just had a baby. My wife took a year off to take care of the kid. I took a month um because I'm lazy. Her job is so much harder than mine. Um, are we gonna see big changes there? We just saw Volvo USA, for example, getting twenty four weeks two men or women when they have a baby. I think so. I mean, I have a two and a half year old,

so I completely understand being a working woman. Listen, I think, um, you know, Kamala Harris called it a crisis, the number of women that are leaving the economy. I think it is organizations recognize that having a diverse workforce is critical to innovation and creativity. So I think employers are gonna lean in. I think it's going to be in the form of, you know, we're going to take a closer look at childcare, at benefits, giving that level of flexibility.

I also think we're going to see and have seen deliberate efforts by organizations to hire women UM and to create programs to hire women into positions to make sure UM that we are getting that kind of equity in the workplace. So that's absolutely going to be UM an uptick in what we're seeing. What we have to realize is it's not just about hiring though, it's also about

reskilling and retraining. You know, UM, the majority of employers are staying their biggest issue is having the right workers with the right set of skills and capabilities to be able to do the jobs of the future. And we're going to need to see massive investments in reskilling and retraining to be able to make all of this happen. And I think that can't be lost. As I look at the you know, Biden's latest plan, I see a hundred billion dollars for worker training. Is that enough? Um?

You know, do we need to invest more? What's the role of organizations playing? And that? I think those are all big questions that need to be answered. So it's interesting, Erica. You know, in the beginning of this pandemic, we heard from some of the technology companies that said, okay, folks, if you want to leave Silicon Valley and work remotely and you know, from Boise, Idaho or something, we're gonna have to adjust your compensation for the different costs of living.

What are we seeing from corporate America as they think about a remote workforce. Absolutely, I mean geographic pay differentials I think are a hot topic right now. I think we will, on the whole start to see adjustments. If people are living in lower cost locations, their pay will be adjusted accordingly to reflect costs of living. And I wouldn't accept that, Erica, You know what, because no, you you gotta pay me what I'm worth. Don't worry about where I live. If I'm del ever ring, then I

want the money. You know, it doesn't matter if I am in Sun Valley or in Silicon Valley. UM, I've been hearing this for a while, and I hope they I hope they pushed back a little. I think this is gonna be This is going to be the debate UM that's to be had, and you know, we're seeing organizations on both sides of defense around this. Again. I think it comes down to UM. You know, the ability

to tap into talent UM. I think it's going to come down to UM, how critical it is for that employee to be able to come in and collaborate with their teammates, and how that's going to be done to drive the work that they're doing. UM. And then to your point, it's going to come down to fairness and and how to help employees get the best out of their lives right. And these are all factors that are going to go into this debate. I don't think there

is an easy answer to any of this. I think this is a debate that's being had at every C suite and every board level right now. Erica, do you have any have you seen any companies that just said screw it, we're going back of the way it was. Everybody in the office I mean, certainly we've seen a couple of CEOs from the major banks that come out and say, we think you need to come back to the office. But I think that's going to be the exception, not the rule. UM. I think most employers are saying,

we've seen flexibility work. UM, we know we need to focus on well being. I go back to that point because I think it can't be understated, and I think they know this is what workers are asking for. But we have to keep in mind also that it's going to be hybrid. You know, seventy percent of employers that we surveyed said they're going to go back to some type of hybrid model. I don't think the majority of employers are going to be all in on site or

all remote, right. Those extremes don't work because that's not what we've learned during pandemic. What we've learned is we need flexibility and choice, we need trust and empowerment. That we don't need managers looking at a worker every single minute of every single day to make sure they're producing. That productivity can still be gained in a remote work environment.

That's what we've learned. And so the question is how do we start to embrace that flexibility and craft policies that allow for that level of flexibility and empowerment for the worker. I think that's where we're talking about the revolt, right. It's are you going to force me to do things in this one way or are you going to trust that I have the ability to still produce the output without being managed every minute of every day. And I think that's the major shift that we're seeing right now.

Just quickly, Bob Prince said he thinks the US is in a new environment of state capitalism. I live in Berlin. We have thirteen months of parental leave, we have seven six weeks, seven weeks of vacation. This is all enforced by the state. Do you think the state is gonna bring new regulations to how we work in the US? You know, I don't know. Um, I'm not sure it's

the case. I think um. I think we will see um different entities, communities, organizations, possibly at the state level trying to do what they need to do to attract people to where they live. I think that's going to be the big factor, right. I mean, these states want people to move there, they want the talent to be there, and so it's not unreasonable to think that they'll start putting in policies to be able to attract workers, and hopefully that's going to start to influence the government at

a federal level. I mean, that's that's ultimately I think would be beneficial to everyone. Erica, really important to get your perspective. Really appreciate you joining us today. Erika Volini is the global human capital leader at Deloitte. Let's take a look at the global oil market. Brent crude is up about seven tenths of one percent todays of barrel

sixty three dollars nineteen cents a barrel. Here, that says OPEC plus is meeting today, and the headlines coming out on the Bloomberg terminal leading with pet plus agrees to gradually increase output over the next three months. Let's get a sense of what that means for these energy markets. We turn to our expert, and that its Dr ellen Wald, president of Transversal Consulting and also a Bloomberg Opinion contributor.

Ellen thanks so much for joining us here. What are some of the highlights that takeaways from what you're hearing coming out of the OPEQUE plus meeting today. Yeah, This is UH kind of an interesting plot twist, you could say, because going into the meeting, it seemed like everyone UH and including even UH from the Saudi Oil Minister, seemed to be focused on rolling over the current production rates

UH and not really UM having much guidance. But it's emerged that it seems that the group is interested in doing a gradual increase of production. They're looking at increasing total production UH three hundred and fifty thousand barrels a day in May and then again in June, and then

an even larger jump in July. But what's even more interesting is that Saudi Arabia is also indicating that UH it is it's it's currently holding an extra million barrels a day off the market, that it's going to start putting that back on the market at the same time, also in a gradual sense, so we're really actually looking at it not an insignificant amount of oil coming back

online in May, June and July. I think what's really notable though, is that OPEC is actually giving a guidance for for the next three months of what it plans to do, and recently they're really only be making decisions on a month by month basis. I think this will be very helpful also for U S. Crewde producers which have kind of been left in the dark as to what's going on in terms of the big national producers have the US, Well, first of all, why aren't we

seeing prices fall? Well, I think it's not all that much oil that they're they're putting back on the market to UH and they kind of telegraphed this a little bit. We did see Brent kind of go up and down a bit as the meeting was going on and weeks were coming out. UM, but I think that in general, some of the global economic news is more positive these days, and so we're not seeing Brent react so much to

the Opeque meeting. So in terms of the U. S. Shale producers, have they been disciplined and what does the what does the output look like? From them? Well, that's really interesting because production is really stabilized in the US around the ten point nine to eleven million barrel per day rate, and that's down from last year where they were producing thirty million barrels a day, and a lot

of producers it's interesting. They responded to a survey from the Dallas Fed saying that they are very hesitant to put out to increase production, to drill more wells, even though at at w t I right now is around sixty dollars barrel, they could very profitably do so, but

they're very hesitant. Both the constant kind of going back and forth from OPEC is giving the pause, but also there's a lot of concern about the Biden administration where they're going with these regulations on federal leasing and and so forth, and that that's really causing a lot of hesitancy among them and not really wanting to band production even though they could profitably do so. So I'm just

looking at Brent crude. You know, recently I got up to around seventy two barrel, we've now pulled back to sixty three. Is that a function of maybe European reopening, you know, slower than maybe the market initially anticipated. Gives a sense of kind of what's driving the market right now, Well, the market has recently really been kind of fluctuating, going up and down a lot, and I do think that, um,

there was a pullback. I think Brent kind of overdid itself and so there was a pullback in positioning h and so really the sixty three range stars barrel is probably a better place for it than into the mid seventies. But absolutely the information from Europe about further lockdowns and travel restrictions is definitely having a damper on prices, though there is a positive information coming out from the United States in terms of travel, uh that really should offset this.

I want to ask you. You wrote a book Saudi inc. And you studied UM Middle East, Middle East Energy, and Middle East History, Prince, and you taught Middle East UM history as well at Jacksonville. What do you think about the Biden administration's approach to the kingdom. Will it change? Well, it's it's very interesting because they're calling it a reset, but really, if you look at what they're doing, it's not all that different from what the previous administration did.

It's not all that different from from Trump's approach. They aren't taking a particularly different approach with Saudi Arabia. UM. You know, both Trump and the Biden administrations have been very specific about wanting to say, deal with the King of Saudi Arabia as opposed to the Crown Prince of Saudi Arabia, which definitely, UM, you know that that's that's

very similar. I don't really see a whole lot of difference, other than very specifically in terms of the weaponry that was being sold that was being used in the Yemen more so so, I think there are some minor differences, but in general, they really do seem to be staying the course. But they won't will they speak with the king instead of MBS. I think that was intimated well.

The Trump administration had the same the same line actually almost to the exact same uh wording that they that Trump would say, you know, I spoke to the king, to to King Salmon. I think, um, you know, they will have to deal with NBS at some point, but I do think there's a very strong desire to deal with the guy on top. All right, Ellen, I'm excited to dig into your book. So it was great that we had you on as well. Ellen wald Um, she wrote Saudi Inc. And she's a senior fellow at the

Atlantic Council, President of Transversal Consulting. Now, let's bring in Timothy fire as the chairman of the Manufacturing Business Survey at the Institute for Supply Management and tim the US manufact xturing expansion was the fastest we've seen since three um was this expected, this kind of rebound, Well, you know, what a fantastic report. I don't think I expected anything this strong. I mean, the last time we saw p my number this strong, I was just starting my career

forty years ago. So a really good number. Had seven or seven of the ten sub indectis all set modern day records, if not all time records. So I really led by the demand side new orders records. Since June four we had customer inventories that we're all time records, the lowest level ever, empty shells everywhere we had, and we ended up with the backlog at record lows at the sixty seven point five. So demand is kind of leading the way here, and manufacturing is leading the country

out of this, you know, this bad situation. You know it's all systems go. We ended the quarter really well, Yeah, this is extraordinary. I like your comment him about manufacturing leading the way. We that's certainly been the case here. Is this a case of um our economy gearing up for what is expected to be a real reopening as we progress that the year, is this kind of priming the pump for expected demand? Well, you know we talked last year in the April May time from about a

v Shape recovery. Manufacturing absolutely saw the shape recovery. We shut down in in April May, and we bounced back in July and we're fully running by August. So and we've continued to climb out since then. And it's it's pure, it's demand driven. We're still constrained by labor, not only had our paneless companies, but out their suppliers. We've got transportation constraints because of all the confusion and the expected

phrase that has to occur to keep factories running. But I think we're into a pure demand driven expansion here where I don't really see any end in sight. And even when the new order levels start to ease, we've got to refill all this inventory. I mean, we have customer inventories way low, our own inventories are way low, and we got a bunch of backplot we have to burn off. So Q two looks really good. Two three, I would say this time, how difficult is it can be?

Too catch up? I saw that um Ford has been idling some plants that make the F one fifty. My heart kind of skipped to beat there. Um They have a chip shortage that we all know about. But I mean, this is a product that people depend on. How much of a problem is it. Well, I think you're really gotta take your hats off with the manufacting people across the country. They're really struggling. They're working very hard. This

is not an easy job, is blocking intact? When every minute of the day new things keep popping up, it's like whack them all. You to show up the next morning, you fix the problem. The next day, there's another problem that's going to continue for probably another four to six months. And they do a great job at it, so product continues to flow. I mean, we've gotten that customer inventory down way too low, But the manufacturing people are out there trying to get you what you need and they're

pretty good at it. So just be a little patient, absolutely, Tim, and talk to us about the uh the transportation we've we've we've seen lots of stories about ports, backs up, backup at ports, rail traffic kind of sitting idle, uh, containers going back empty. Gives just give us a sense of kind of the transportation infrastructure and how that's impacting

manufactured leaving canals aside. Yes, yeah right, yeah, I'll leave this so that's the European problem pripparently not a US problem, but generally, when the manufacturing economy starts to heat up, you see it first in transportation, and the reason is the factories need need product, but they can't wait a week for the product to show up in a full truck, so they tell the transporter go and pick up a

half a truck. Well, that really means need to trucks for one delivery, and then it's just kind of compounds from there. Since the month of November, we've had increasing comments about transportation difficulties. We're now running somewhere around my general comments are transportation related, and they're up from last month, so we definitely have not peaked yet. It's going to continue into April, probably into May. The indications on the port issue. Initially we're around May or June. Now it's

looking like maybe Midsummer. But that's all good. It's all it's all means that we have supply chain constraints because we have an abnormal amount of demand. That's all positive. What kind of pricing comments are you getting inflation? Well, we only had half a percent of our entire panel that said prices were down half, so that's that's like zero and this is like the third month of that, so we you know, we have some of them are

reporting same. The steel prices continue to grow. The plastics, all the petro chemical and plastics areas really impacted by the weather that hit the Gulf coast back in February March about eighteen or some of my general comments were weather related back to that event, because it was so severe on the equipment of machinery that, uh, it takes a little while to repair. So prices are gonna continue

to go up. Aluminiums skyrocketing, copper, brass, name things. As long as there's demand continuing, you're gonna see ramatul imput prices go up. To Hey, Tim, thanks so much for joining us. Really interesting report this month showing just extraordinary strength coming out of the United States manufacturing sector, continuing to strength that we've seen them belows of last year.

Timp Fury, chairman of the Manufacturing Business Survey for the Institute for Supply Management based in Miami, Florida, and matt It really is amazing how how resilient, uh, the United States manufacturing base has been. Now let's get out to Sarah Fryer She's a Bloomberg technology reporter who has been doing a deep dive into the misinformation spreading across social media,

specifically Facebook in regards to vaccine. Sarah you Um have interviewed, for example, one woman who doesn't believe in vaccine induced her immunity. Does she get this from Facebook? She gets this from from Instagram, which is of course owned by Facebook. What happens here is people fall into the personalization that Facebook and Instagram provide them. If you start looking into this.

Woman started out looking into holistic medicine alternative treatment. She felt um bullied by her doctors during a cancer treatment and was looking for another way to stay healthy. Suddenly she's getting this information about vaccines that's not really information at all. It's it's fearing her wrong. And a lot of the people who are telling her, oh, you just need to take this, you know, holistic healing method or detox in this method, or um you try these techniques.

They're selling supplements, they're selling essential oils, they're selling um, you know, wellness retreats, and so she's she's not really getting vinemit information from doctors, and we're seeing that happen a lot on Facebook. It's more about the fear um. The kind of messages that spread on Facebook are the ones that that make people comments and share. That's what tells the New Street algorithm that it's a serious post

that more people should see. And so these lies about the vaccine, particularly lies that are targeting women, which we can talk about in a second, are are just unable to be chanced down by the company. Yeah, that's kind of where I wanted to ghost Sarah. You know, it's just kind of what we're hearing from Facebook here. But first, let's why are women being targeted here? Well, it just

goes to a history of the anti vaccination movement. It has always been about scaring women out of giving shots on time or at all, to their their newborns and their young children. So this is this is a demographic that is already the subject to information from anti vactors, and with the COVID nineteen vaccination movement, it's strategic on

their part. They see that as an adjacent, vulnerable, vulnerable group and they are telling women that the shot will affect their fertility um that there's there's some psych protein in the fider Madorna vaccines that connects to the same kind of protein that creates a human placenta, and therefore they were to take it their bodies and becomes confusing, and that is just not true. And in many doctors, including five or even itself has put out a statement.

But that scientific explanation of why that's not true. Um, you filled with with explanations of and we know acid change. That just simply doesn't go viral on Facebook the way that that fear does. So much easier to share a personal story of fear than to share something that's based in real science. So the concern is one of First Amendment rights. I guess from Mark Zuckerberg's perspective, right, people should be able to say what they want, and I

guess whether it's true or not. Um. But then if you have an algorithm aiming lies at people who are susceptible, that becomes something that the government should worry about. Well, first of all, let's looks clear up, there is no such thing as the First amountment on Facebook face because not a government as diusy, they don't have any any guarantee for you in terms of the First Amenment of

free speech. Second of all, well, but but Zuckerberg seems to want to stick to the principles of the constitution. He wants to. But but that's also convenient for Facebook because that means they don't have to do as much leading as content and they don't have to take as much responsibility for for it. Um. What happens on Facebook is is that this this content, it's not treated neutral

e by the algorithm. You know, it hands off approach to what happens on Facebook needs the algorithm is in charge, and the algorithm is always going to spread that which generates more engagement, more shares, the things that Facebook needs for its own future. They want more revenue, they want more engagement, and so so that is the natural, unblenished version of Facebook. And the rest is enforcements beyond that, like who should be a banned where should we put

labels about what might be fault um. But the core of the product that designs the product is really what is that an issue here? And if you we talked to doctors who are trying to become more social media friendly, using Instagram, using Facebook, um, even using Twitter and TikTok to try to spread information that's a little bit more palatable, a little bit more shareable. UM. More buzzy, but it simply isn't reaching the communities that have already built this personalization.

Facebook has automatically built personalization for them around what kinds of people they listened to, so they're not really getting these these good abouts of information into that into that normal experience. So it's really a tough situation. Yeah, it's very difficult. This is something that Facebook and its users have been dealing with for a long time about many topics, but this one is very very uh interesting, potentially dangerous.

Sarah Fryer, thank you so much for joining us. Sarah's technology reporter for Bloomberg, Um, you know, covering Facebook and as she wrote a great book on Instagram, I recommend that. So she's really really in deep with all things that's

going on at Facebook. And again, as we try to get these vaccine out there, one of the concerns that we've heard from many experts from the Johns Hopkins University in other places is vaccine hesitancy uh is going to become more and more of an issue, and social media certain playing a role there. Thanks for listening to the Bloomberg Markets podcast. You can subscribe and listen to interviews with Apple podcasts, or whatever podcast platform you prefer. I'm

Matt Miller. I'm on Twitter at Matt Miller. Pet On Ball Sweeney, I'm on Twitter at pt Sweeney. Before the podcast, you can always catch us worldwide at Bloomberg Radio