Scott Martin – Fox Business News 8.27.22 Cavuto Live Pt. 2
Program: Cavuto Live
Station: Fox Business News
NEIL CAVUTO: In the meantime here, there are a lot of people who are debating going back to work, not that they’re losing work, but they’ve been working from home. And now some compelling reasons to maybe rethink that strategy. In Britain, they’re telling those or at least increasingly hinting to those that do, that they could get a 20% cut in pay. Furthermore, it comes at a time when many across the world are dealing with higher utility bills. And in parts of Europe, especially Britain, again, some workers are deciding to escape the high utility bills. They’ll turn the thermostat down this winter and just go into the office and leave the heat on the boss. Does that put the heat on their economies? Let’s get the latest from Kathryn Rooney, Vera and Scott Martin, Michael Zito. Michael, if we take this at face value, it’s a sign that workers can still have that freedom. I don’t think anyone’s going to take it away right away. But a lot of companies and maybe just the nature of higher bills and are telling them it’ll cost you, will it?
MICHAEL SZANTO: Well, you know, it was almost 20 years ago that JetBlue decided that their agents would best work at home. So there are jobs that it’s ideal to work from home, but far more. The company’s going to want you to come into the office, at least for some of the week. And if for some reason somebody doesn’t want to come into the office at all, then I think it’s only reasonable that the company doesn’t have to pay them as much if the company is even willing to accept it. But you know, like I said, there are some jobs, a few that working from home is fine. Many. It’s best if you come into the office at least some of the week. And then there’s other jobs where companies are just going to have to say, for the vast majority of employees, you have to come in once again every single day. And if somebody doesn’t like it, then they can try to get work from home more often. But I think it’s reasonable then for them to be paid less if that’s not ideal for their employer.
CAVUTO: You know, you do have to wonder this environment, Kathryn, I think it was Jamie Dimon, the head of JPMorgan Chase, who was really, again, echoing the need to get people back into the office five days a week. And I’m thinking to myself, I think you’re building a $3 billion tower in New York and you want to fill it. So I get that. But there’s been subtle pressure on the part of other investment firms, money center banks, urging their people to get back a little less. So now in light of the crime in the New York area that has even the head of Goldman Sachs saying, all right, well, we understand your reluctance because it’s scary to take a train, but it does seem to be the direction we’re going, getting more people back in the office. What do you think?
KATHRYN ROONEY VERA: Yes, it does. But it all has to do with the strength of the labor market, Neal, when it’s a red hot labor market, then we’re talking about benefits like flexible work or remote work or snacks in the office or whatever it takes to entice people off the sidelines, higher wages, you know, whatever you want to get people in the door. But when things change and when unemployment moves higher and we’re seeing that, we’re seeing companies rescinding job offers now, we’re seeing plans to fire people. And when that happens, then who cares about remote work? You want work and I’ll give you some numbers. In first half of this year, productivity dropped on average, Neil, in first quarter and second quarter of this year, 6%. So output per unit worked is dropping. So companies are getting less out of their employees than more. They’re paying more, but they’re getting less. Unit labor costs increase on average 12% annualized in the first half of this year. So so things are going to change. And if I’m right and unemployment goes from record lows, three and a half percent to four and a half percent or 5%, then you’re going to be excited to have a job whether you work remote or not.
CAVUTO: Well, it could be something to that. I didn’t know all those numbers. You know, Scott, there is also the argument here that the pendulum could be predictably swinging here from workers who could sort of tell their bosses where to get off to. Workers now saying, well, you know, I’m not going to try to take as much time off. So I’m just wondering, where do you see this headed and whether, you know, Jerome Powell was right. You’re going to be looking at economic pain. I know he was talking the bigger aggregate about inflation and all of that, but it has repercussions, right?
SCOTT MARTIN: Yeah. Same thing has happened on our end. I mean, gosh, for the first half of this year, we didn’t really have any power on hiring. I mean, folks would show up for the job or show up for the interviews and want so much more. I mean, as Michael said, you know, things more on pay, things more on benefits and less time in the office. And I think the point was made. Well, we’re sure I mean, there are some areas where you could work from home, maybe more on, say, a customer service aspect where you have the computer and set up and you can handle some things over the phone. But my goodness, when did work become the problem in many people’s lives? I mean, when did people not want to be around others anymore and collaborate? And as Katherine said, you know, raised that level of productivity because what’s ended up happening now is to your point, Neil, on the pendulum, it went too far over to that one side and it will swing back. The question is, given the psychological damage that we’ve had from COVID, the the psychological jump jumping around that the employers and employees have done over the last several years with with work and pay, is there a way that employers and employees can come to the middle on this? Because there’s a lot of bad feelings out there about what’s happened so far and it’s showing up in the economic data.
CAVUTO: Yeah. And then you find out, you know, if your colleagues are doing something, you got to do something and it adds to the pressure. I’m just angry because I found out the other anchors here are paid and I just went apoplectic. But guys, thank you all very, very much. Good seeing you all.