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Does it matter if your boss is rich?
It's a question I've thought about only occasionally over the years, mostly when poor friends have reported unexpected misunderstandings with wealthier bosses.
One Australian woman whose clearly confused new manager listened to her explain that she had to leave work at a set time every afternoon to pick up her children from school, then asked her: “Why don't you just get a babysitter? She explained that unfortunately, that would be difficult with the salary his company was paying her.
Another friend who could only afford a property miles away office surprised her wealthier boss, who lived closer to work, by revealing how much money she saved on train tickets while working from home during the pandemic.
Then there was the executive who invited his team into his sprawling home for a morning meeting and ushered them into what turned out to be neither the dining room nor the kitchen, but the “breakfast room,” an area set aside exclusively for breakfast. larger than the apartments 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.
There are more and more wealthy workers in developed countries across Europe, Asia and North America segregated from the less well off.
Across industries and within individual companies, there has been a “dramatically declining exposure of the top earners to the lowest earners,” the study authors say. Great separation paper published late last year.
Let's take 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 highest income group. By 2019, that 9 percent share had nearly doubled to 16 percent.
In the Netherlands in 2006, the top 10 percent of earners worked where around 25 percent of their co-workers had similar incomes. By 2020, this percentage had increased to almost 30 percent.
The higher the top level 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 loss of industrial jobs. Factory life connects workers with supervisors, engineers, managers and executives. Inside a bank, insurance company or software developer, it's different.
Outsourcing or offshoring jobs such as data entry or payroll clerk roles widens the divide by removing chunks of lower-income workers from the office.
So is the rise of digitization, which automates low-paying jobs. This trend underscores why wealth segregation may be growing.
Research on this paper began many years ago, says co-author Professor Halil Sabanci of the Frankfurt School of Finance & Management.
This was before ChatGPT and other types of advanced artificial intelligence took off in the workplace. Sabanci thinks it makes sense to expect artificial intelligence to accelerate the segregation of wealth that the digitization of work has already caused.
All of this can have profound political implications.
Sabanci and his colleagues suspect that the isolation of elites at work has already helped breed resentment among poorer workers who read or hear about the lives of top earners but rarely see or meet them.
“This situation could increase feelings and experiences of being abandoned, ignored and misunderstood,” they write, adding that this could in turn contribute to the support of Trumpism and other forms of populism in Europe.
Voter polarization between wealthy capitals or coastal cities and struggling hinterlands has certainly been a prominent feature of a number 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 of the vote in the Paris region was about the same as the 14.4 percent he won elsewhere, some of the paper's authors write earlier research.
Thirty years later, support for the daughter of right-wing populist leader Marine Le Pen has fallen to 12.5 percent in Paris, but has risen to 27 percent elsewhere – nearly double her father's vote.
Of course, this change was not just due to the widening separation of top earners from the rest of the workforce. However, it is easy to see that this segregation may have fueled this shift and perhaps accelerated it.
