Previously in Politics & Prose:

Plunder on the Right (May 2, 2001)
Arsenic, global warming, and George W. Bush's re-election strategy. By Jack Beatty

Hitler's Willing Business Partners (April 4, 2001)
A look at IBM and the Holocaust, a shocking account of Big Blue's dealings with Nazi Germany, and what some critics have failed to grasp. By Jack Beatty

The Crooked Timber of Humanity (March 8, 2001)
A review of Philip Roth's recently completed trilogy of novels, a "moral history of post-war America with a fierce dialectical intelligence." By Jack Beatty

The Search for the Smoking Gun (February 7, 2001)
A look at David Kessler's A Question of Intent and the gripping moral, scientific, and political story of Kessler's battle against Big Tobacco. By Jack Beatty

Prime-Time Propaganda (January 10, 2001)
What the election revealed about Jennings, Brokaw, Rather, Lehrer, et al. By Jack Beatty

The Burden of Florida (December 14, 2000)
The cavalcade of racial injustice that was the Florida recount. By Jack Beatty

More Politics & Prose in Atlantic Unbound.

More on books, literature, and the arts in Atlantic Unbound and The Atlantic Monthly.

Atlantic Unbound | June 7, 2001
Politics & Prose | by Jack Beatty
Cannibalistic Capitalism

White-Collar Sweatshop details the indignities of working in corporate America, where workers are paying the price for increased competition


White-Collar Sweatshop

White-Collar Sweatshop
by Jill Andresky Fraser
W.W. Norton
352 pages, $26.95

ompared to their peers thirty years ago, America's 80 million white-collar employees are working longer hours, for the same pay and fewer benefits, at jobs that are markedly less secure, and for corporations that regard firing whole ranks of employees as a way to post paper gains and so win Wall Street's favor. The long arm of the job has reached into employees' homes, their nights, their weekends, and their vacations, as technology designed to make work less onerous has made it more pervasive. America's insecure white-collar workers are victims not of poverty, like the blue- and pink-collar workers Barbara Ehrenreich writes about in Nickel and Dimed (2001), but of progress. They are, Jill Andresky Fraser writes in White-Collar Sweatshop: The Deterioration of Work and Its Rewards in Corporate America, "suffering the unwanted ... consequences of the nation's recent economic boom." Her new book raises the question of whether the deterioration of white-collar work is more cause than consequence of that now-fading boom. Is a eupeptic stock market a sign not of new wealth creation but of a redistribution of resources from workers to owners? Or, rather, from workers to their own pension funds? "We are all devouring ourselves," an art designer for a major publisher told Fraser. "We all own stock, and as stockholders, all we care about is profits. So we are the ones who are encouraging the conditions that make our work lives so awful." Call it cannibalistic capitalism.

Fraser, the finance editor of Inc. Magazine, spent four years talking to white-collar workers in industries ranging from banking to high-tech, and White-Collar Sweatshop thoughtfully synthesizes the personal testimony gained from her interviews and from Web sites like "" and "" with big-picture research.

According to Juliet Schor's The Overworked American (1992), "If present trends continue, by the end of the century Americans will be spending as much time on their jobs as they did back in the nineteen twenties"—before the eight-hour day became standard. A software-industry professional explains the Darwinian dynamic behind the twelve-hour day: "The long hours aren't because we want to outshine everybody; we want to keep up with everybody." A recent Lexus ad boasts, "Sure We Take Vacations. They're Called Lunch Breaks." But even lunch is becoming a luxury: 39 percent of workers surveyed by the American Restaurant Association say they are too busy to take a lunch break. What Fraser calls "job spill" is "the dirty little secret behind many a corporation's thriving bottom line." Half of all households own pagers and half of those who own pagers have been beeped during a vacation. There are now cordless telephone sets that allow your company to call you while you are taking a swim. And, Fraser reports, there's a "new type of floating chair capable of supporting people who want to combine a swim with work on their laptop computers." Back at the office, the average employee must cope with 200 e-mails every day, being careful not to use "alert" words like "union" or "boss" in e-correspondence—"investigator" software may be watching. (Job-related stress from intra-office competition, long hours, and intrusive technology costs the economy an estimated $200 billion annually.)

Overwork and job spill would perhaps be bearable if one were being well paid for it. But white-collar men earned an average of $19.24 an hour in 1997, just six cents more than their fathers made in 1973. Back then the average new college grad earned $14.82 an hour, "which adds up to $1.17 per hour more than his 'gold'-collared counterpart was paid in the high-pressure corporate world twenty-five years later." The rise of "contingent employment" has also lowered wages. Contingent work, Fraser notes, is the human equivalent of "just-in-time" manufacturing—the arrival of production materials only as and when needed. Benefits? From medical care to pension coverage to vacation time to Christmas bonuses, "perks" have steadily declined since 1980.

What is to blame? The short answer is price competition. The post-war era can now be seen as the golden age of oligopoly. A few large companies dominated each of the major industries, competing on product quality and image—"You'll wonder where the yellow went when you brush your teeth with Pepsodent!"—but not on price, the race-to-the bottom form of competition that can put companies out of business. They tolerated the union wage—35 percent of workers were unionized by the late 1950s—as a cost of doing business they could pass on to consumers, who, in an exclusively national market, had no choice but to pay up. In the twenty-five years after 1945, the GNP doubled, wages nearly doubled, and America's corporations flourished as never before or since. This "American High," as one historian has called it, ended in 1973, when the Arab oil embargo quadrupled the cost of oil overnight. The embargo was a symbol of the emergence of a world economy—Europe and Japan having recovered from the war and the oil-producing countries newly conscious of their power over the industrialized West. Whereas imports accounted for less than 10 percent of the US market in cars, steel, and televisions and radios in 1961, twenty years later they accounted for 26 percent of the car market, twenty-five percent of steel, and 60 percent of televisions. Altogether, imports were competing with upwards of 70 percent of US-made goods by 1981. World-famous corporations melted in the crucible of competition. "Of the country's 500 largest manufacturers in 1980, one in three had ceased to exist as an independent entity by 1990," Michael Unseem writes in Investor Capitalism (1996). "Companies built to last like pyramids," Peter Drucker reflected in the early 1990s, "are now more like tents."

In his book Only the Paranoid Survive (1996), Andrew Grove, the CEO of Intel (which Fraser depicts as a Silicon Valley sweatshop), brings the new corporate insecurity home. "When companies no longer have lifelong careers themselves, how can they provide one for their employees?" That logic is hard to argue with, and that may be why most white-collar workers have accepted their fate, albeit bitterly, resenting the fact that they have to pay for bad business decisions made by executives whose pay has risen an average of 70 percent since 1990.

Fraser ends with a list of remedies for the white-collar sweatshop that, though laudable, don't quite answer Grove's question. Companies were once good to their white-collar employees to keep out unions—and white-collar membership in unions has traditionally been low—but Fraser suggests that veterans of the white-collar sweatshop may be receptive to unions now. "In an economic environment in which even the American Medical Association has decided that it makes sense to organize doctors (at least those who are salaried employees of HMOs and hospital corporations)," she writes, "anything seems possible." She cites industry predictions that the financial-services industry will be unionized within the decade. She also sees unfathomed potential in the power of socially conscious investment vehicles to change corporate behavior. "I believe that people could use their savings and retirement dollars to punish negative workplace practices, without suffering a financial setback," she writes. Funds like the Citizen Global Equity Fund Family that only invest in companies that meet certain environmental standards have outperformed the S & P 500 Index. Why couldn't decent treatment of employees be a standard for investment as well? The irrationality of cannibalistic capitalism argues against its longevity.

From Atlantic Unbound:

Politics & Prose: "What Work Costs Us" (February 10, 1998)
A recent book examines the demoralizing effects of the newly ascendant business regime. By Jack Beatty
But the problem of competition remains. Insecure companies make for insecure employees. John D. Rockefeller invented corporate capitalism as an escape from the atomistic price competition of Adam Smith. "Only a professor," Rockefeller said, could believe that great companies, with high sunk costs, could compete in this way. Corporate capitalism sought to replace the invisible hand of the market with the visible hand of management. Some economists see the mega-mergers of the past few years as gropings for the stability of global oligopoly, for the return of the visible hand. Without system-wide stability accompanied by a global New Deal that would protect society from the power of global corporations, the conditions of work ably documented by White-Collar Sweatshop are likely to only get worse.

What do you think? Discuss this article in Post & Riposte.

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Jack Beatty is a senior editor at The Atlantic Monthly and the editor of Colossus: How the Corporation Changed America (2001). His previous books are The World According to Peter Drucker (1997) and The Rascal King: The Life and Times of James Michael Curley (1992).

Copyright © 2001 by The Atlantic Monthly Group. All rights reserved.