Microsoft President: Pressure to pay higher salaries could become permanent

Microsoft President: Pressure to pay higher salaries could become permanent

US companies are entering a “new era” in which fewer people are entering the workforce and the pressure to pay higher salaries could become permanent. That’s what Brad Smith, President of Microsoft, said in an interview with the news agency Reuters.

Smith cited the decline in population growth in the United States, Europe, China and Japan as one reason for today’s “major economic turbulence”. The trend that the US working-age population has increased by about five million people every five years since 1950 has shifted for several years. For example, population growth in the United States slowed to two million between 2016 and 2020, Smith pointed out, citing United Nations data. Other large economic blocs have also seen a significant decline in the labor force.

“That partly explains why you can have low growth and peak labor shortages at the same time. There just aren’t that many people entering the workforce,” Smith told Reuters. Other factors such as government support measures during the pandemic, concerns about COVID-19 and a lack of childcare also contribute to the current shortage of workers.

Increasing competition for limited skilled workers and union campaigns have prompted Microsoft to rethink. The group grants its employees the right to organize in unions and has announced that it will work together. It recognizes the right of employees to form or join a union and is committed to working “creatively and cooperatively” with unions and employees. Recently, Microsoft has also increased salaries while slowing hiring, Reuters reports.

The news agency cites data from the US Department of Labor in June showing that US employers, on the whole, are hiring far more workers than expected and steadily increasing wages, and sees signs of continued strength in the economy US job market.

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