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Culture War Roundup for the week of September 16, 2024

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https://www.cnbc.com/2024/09/16/amazon-jassy-tells-employees-to-return-to-office-five-days-a-week.html

Amazon is instructing corporate staffers to spend five days a week in the office, CEO Andy Jassy wrote in a memo on Monday. The decision marks a significant shift from Amazon’s earlier return-to-work stance, which required corporate workers to be in the office at least three days a week. Now, the company is giving employees until Jan. 2 to start adhering to the new policy. Corporate employees will be expected to be in the office five days a week “outside of extenuating circumstances” or unless they have been granted an exception by their organization’s S-team leader, Jassy said, referring to the close-knit group of executives that report to Amazon’s CEO. “Before the pandemic, it was not a given that folks could work remotely two days a week, and that will also be true moving forward — our expectation is that people will be in the office outside of extenuating circumstances,” Jassy said.

Amazon's corporate moto has always been "I Am Altering the Deal, Pray I Don’t Alter It Any Further." so it is of no surprise that they are the first of FAANG to reinstate the office policy. I don't think that they chase any productivity gains because most white collars are as useless and unproductive in the office as they are as useless and unproductive at home. And all this extra workforce on premise will probably cost them more since they are not saving as much on office space and so on.

So couple of explanations - those are soft layoffs - some of the high value people will leave, but probably the majority of the people will be the one with somewhat unrealistic opinion of their own worth. And it is not as if the tech and tech adjacent industry are not filled with primadonnas.

The other one is - middle managers try to show the plebs who exactly is running the show. The tech company is no longer in weaker bargaining position - so it is payback time bitches. It has been more than two decades since tech workers had to negotiate from position of weakness and I think it will be quite the rude awaking for some. I guess the other FAANGs will move soon in the same direction.

As a bonus - I think that offices will move until the economy is tight to be a bit more apolitical space since managers dislike crybuillies even if they share ideology.

middle managers try to show the plebs who exactly is running the show

On that point:

In the case of managers, Amazon aims to flatten organizations by asking each of its S-teams, or senior leadership teams, to increase the ratio of individual contributors to managers by at least 15% by the end of the first quarter of 2025, according to the message.

Unclear if they mean fired or just turned into individual contributors. Presumably a mix of both.

Most people are much less productive from home. Home has more distractions; you can play with your dog, hang out with your partner and/or children, watch TV, play video games, do chores, do online shopping without the risk of your boss who sits behind you noticing that you do so for four hours a day, can go for random naps. If you trick yourself into thinking you don’t really need to do this project today you can stop working at 3pm and treat the rest of the day like a weekend, take a two-hour lunch to see a friend etc.

In the office, you can either do your job, procrastinate at your desk (as above, riskier and more boring than doing so at home) or spend time talking or coworkers, which bosses look upon more fondly than other kinds of socialization since they think it helps ‘team cohesion’ or leads to ‘water cooler moments’. You also don’t want to be the guy who always leaves two hours before everyone else, whereas people mostly don’t notice the person who goes afk from their wfh teams chat early.

It’s trivially true in my experience working with otherwise motivated and ambitious people that employees cannot be trusted to work from home. Humans are a social species and our obligations to each other break down - even against our own will! - when we don’t see the people to whom we owe them.

In my current role I dont know which way causality works. I am less productive on remote days, but we also get less work incoming on remote days. This also means my long term projects and backlogs get done more often on remote days, but I dont have an exceeding amount of those, and often they are in backlog because I sent something out for review, or requested something that hasn't been sent to me.

I suspect this is very true in the modal case. I've known a couple of exceptions that are self-motivated enough to make remote work effective. And I'd buy that it can be better for very deep work requiring intense concentration and few distractions for those that can manage it in those circumstances. But I will also admit that I feel at least a bit less productive on those times when I do get to work from home.

But I also know people that are being forced back into the office to hot-desk and work with distributed teams, so they aren't really getting the benefit of in-person discussions, which IMO have a much higher bandwidth than video chats.

Inside scoop: the RTO enforcement came from Andy Jassy directly. There were no discussions with middle managers. The AWS management in fact, put up some group resistance during 3-days-per-week policy announcement. I remember seeing email chains, discussions, calls for data-driven decisions, even a lot of dissent coming from org directors. This was done hush-hush, without collaborating with the very public employee movement.

The inside scoop I heard second hand was that this was just soft layoffs.

My comment was written in order to refute this statement directly:

middle managers try to show the plebs who exactly is running the show

But yes, the end result is pruning the workforce, which might have or might not have been the end goal, but there's no corroboration of this being intentional. We can try to infer and I agree that it's likely.

My thought here is that this is a deep strategic move by Amazon.

Forecast sequence of events:

  1. Amazon brings everyone back in for 5 days a week
  2. Competitive and smaller firms also put this rule back in place because, "If Amazon is doing it, we're doing it."
  3. While the FAANGs et al now do have the upper hand in bargaining power, smaller firms might not. Employees at those firms might make the rational decision to seek employment at a higher compensation if they're going to have to come in 5 days a week. Where would they go .... I'd wager one of the FAANGS as they still can pay those higher-than-market wages for above median employees.

If there's only one game in town, you play with the best player. Amazon isn't hacking the system, they're altering the playing conditions of the entire market to their own benefit. This is what you expect from hyperscale corporations.

Anecdotally, a lot of the management practices at Amazon were formed around what amounted to competitive social pressure. It wasn't explicit like banking (yeah, you're gonna work 80 hour weeks) but it was just beneath the surface. Remote work kills that social pressure environment. I can see how, based on their own internal metrics, the past few years would look to Amazon like a major drop in productivity.

Added conspiracy theory:

I wonder if this may also be a reaction to the "overemployed" movement. To those not familiar, "overemployed" is a situation in which an individual is employed at two or more full time jobs, but they are white color in nature. High over-representation in tech / tech adjacent jobs. The legal status of doing this is a little murky, but if any company finds our you're doing this, you're probably getting fired one way or another. I wonder if Amazon - which is addicted to metrics - found a way to reliably identify employees who were pursuing this strategy and then discovered the only way to reliably stop it was to necessitate return-to-office policies.

I wonder if this may also be a reaction to the "overemployed" movement.

An amusing and interesting theory, one that the OverEmployed subreddit has been discussing as well. Good for them: Slay, Kings; the OverEmployed give me energy.

However, based upon my impression of that subreddit, I imagine the proportion of Amazon employees who are OverEmployed is relatively small, especially among positions Amazon cares about. It’s not the $600,000 Machine Learning Researchers moonlighting at a second job, but rather the fungible redshirts who make $70,000 to $130,000 or whatever in Sys Admin or Dev Ops who take on a similar role at a different company.

So, in one respect, it’s tough for me to envision Amazon re-orchestrating their WFH operations based upon the redshirts. Although, I could totally envision Amazon punishing all their employees based upon a small segment of employees of which they barely give a fuck about. Maybe the redshirts are a large percentage of headcount.

In general, firms do appear to care a lot about their employees having passive income, secondary gigs, much less be employed elsewhere. Through their mouthpieces such as HR, they say it’s due to conflicts of interest or potential leaking of intellectual property. However, I suspect that’s but an alibi for being butthurt, just like how a wife who’s deadbedroomed her husband might get butthurt over her husband stepping out to bang other women.

The parallels are not coincidental. Just like jobs, women are more easily obtained when you already have one. My Reddit feed often provides drama from OverEmployed and subreddits like AITA/relationship_advice/etc. right near each other. An inside joke in OverEmployed is to bring-up wives and sidepieces as W1, W2, W3, just as they would J1, J2, J3, when it comes to jobs. Although, being Redditors, commenters would also be quick to bring up wife’s boyfriend(s).

This is probably a good thing long term for Amazon's employees, assuming that AI doesn't lead to mass job elimination.

A job that can be done remotely from your suburban home can also be done remotely from eastern Europe. And the average wages of a tech worker in Seattle are probably something like 5x a Romanian one.

It was inevitable that most high-paid remote tech workers would be replaced eventually. American workers are not inherently superior to those in many other countries.

Still, a product which can be developed in offices in Seattle can also be developed in offices in Romania or India. Granted, there are coordination problems, and teams have to talk to each others, which is more difficult when they live in different time zones, but the option to outsource some team is always on the table.

A job that can be done remotely from your suburban home can also be done remotely from eastern Europe. And the average wages of a tech worker in Seattle are probably something like 5x a Romanian one.

And it can also be done in the same time zone from Latin America for like an eighth of the price, with no language barrier because professional class argentines and Brazilians and Mexicans all speak English, even if accented.

Corroborating evidence from Canada:

Canada's labour market is much slacker than the United States. Coming out of the pandemic, immigration to the U.S. increased (especially illegal immigration best as we can tell), but in Canada there was an enormous surge in immigration to keep wages low and slow inflation. We brought in 3 million people in 3 years and our unemployment rate is now 6.6% compared with 4.2% in the U.S. In some parts of the country about 25% of the 20-29 age cohort is Indian temporary workers now, which is a story for another time. Think Springfield Ohio, but literally everywhere.

The upshot is the effective end of remote work and the squeezing of hybrid except, possibly, in the federal civil service. I'm back 4 days a week now as are all the people in my wider circle. Traffic is back to pre-pandemic levels.

Management has always hated remote work. Part of it is a skill issue around learning how to manage people remotely, but a key factor is this: remote work increases the variance of individual contributions. Some people are unaffected. Some people do more: they spend the time they would have spent commuting working and with fewer distractions their output goes up. Some people need the proximity of management to get them to do anything and spend their days at home cooking, cleaning, wasting time, etc.

Firms struggle to identify who that latter group is and even where they can see them, they can't bring themselves to fire these employees or disproportionately reward the people whose productivity increases. They can't accept the status quo for morale reasons. So instead everyone comes back.

Its such a shame because Canada, more than any other major western country, has had economic growth concentrated in its major cities over the past 20 years. You can see this in our real estate prices and for a young Canadian, the deal on offer is terrible: no jobs outside the big cities, no homes within them. Remote work offered a way through, but now its over.

they can't bring themselves to fire these employees or disproportionately reward the people whose productivity increases.

Why is this so true? I would be happy to do this, but it seems it’s anathema to most companies. Any explanations?

I think there is widespread 'firing aversion' because:

  • Managers hate firing people, its very unpleasant and can be traumatic. Many people will do what they can not to do this.
  • It can adversely impact morale and culture to have lots of firings. People will hunker down, it can create a culture of fear, etc. (of course cultural impacts can be bad if poor workers aren't fired too, but few consider this).
  • Law suits and severance suck.

I think you underestimate the degree to which plenty of people completely stop working when "working from home". You might think they were low productivity before but now they're producing practically nothing.

I'm under the assumption that we will move towards a situation where pretty much all jobs for which it isn't trivial to measure productivity for, isn't commission based or where the the organisation is sufficiently small that people share ownership, will move back to almost 100% office.

This means all larger companies, governmental agencies, etc. When it isn't it will often be with a tacit understanding that the job is in fact part time.

It's really pathetic how little progress the tech industry has apparently made towards measuring and incentivizing actual productivity, that some of the foremost employers still feel like they need to chain people to a desk and hope that they'll get something done that way. This is despite having approximately the most naturally conscientious workforce in the world.

Remote work aside, there is so much on the table for the employer that's able to keep the 10x software engineers and fire everyone else that it's mind-boggling how few companies have even tried to pull it off. I'm not sure if it's ideological commitment to egalitarianism, principal / agent problems where middle management pursues empire building instead of efficiency, or just genuinely that difficult of a problem to solve.

One aspect of "empire building" is that size of your empire correlates with your position in the company hierarchy, and your position correlates with your compensation.

I generally believe in more in free markets than in planned economies, and consequently I am capitalism-pilled on of the Western corporate organization structure. It looks much too much like a Sovjetized planned economy. Like in a planned economy, management upwards from middle level in the hierarchy is seldom compensated for their management and leadership skills. They are compensated because of their advantageous position in the food chain: if the leadership has a vision, they can't make it happen without giving orders through middle strata. The feedback back up ... comes through the middle strata. The productive units and teams of the organization have learned to communicate and align their work with the distant cousin units ... through the middle strata in the hierarchy. In any large enough white-collar company, the cost of management-level failures are diffuse and difficult to blame on anyone in particular. Individual contributor level productivity failures can be pinpointed on the individual and their manager. When whole organization no longer meets the targets? Much more difficult to prove who was in charge of the failure. Stock owners may complain, but don't know enough of the day-to-day operations to demand informed precise corrective actions.

Your theory makes sense a priori but I don't understand why we don't see firms that are run internally like a free market dominating the supposedly inefficient command-based firms which we actually see.

Couldn’t you say Wall Street kind of works like this? Bonuses are allocated to different desks based on their P&L and are usually a larger % of comp than salaries are for more senior employees. Also professional services like consulting, law, accounting etc. are typically “eat what you kill” at the partner level at least and directly measure employee productivity through billable hours

(0) Some products and services are so complicated to manufacture that making them competitively requires certain size.

(1) If the megacorp has monopoly / oligopoly / regulatory capture on the markets, they can deliver more than enough largesse to both owners and the management without need to optimize their processes. (Boeing receives orders because not everyone can buy Airbus planes without doors that disintegrate midair -- Airbus has limited production capacity.) And if you have the capital, you can buy off the competition, which is easier than try to fix your corporation.

(2) Running a company like a planned economy is bad, but perhaps running it with an internal fake market economy is worse. Stands to reason that you try to design a fake market with both benefits of market and benefits of integration, it is easy to mess it up and obtain only the downsides of both.

I do wonder why we we see more acquisitions leading to mergers than "unmerged" companies. Why own a megacorp when you could own a collection of leaner, smaller companies? Capturing large enough of size of the market beats the command-rule inefficiencies? Perhaps, (3), the modern IT and communications makes the command economy to work well enough on the scale that wasn't possible with the tech-level of 1970s?

principal / agent problems where middle management pursues empire building instead of efficiency

I think that this is a huge part of the problem. In management, the number of people working under you is kinda your dick size.

Of course, you could have a system where the managers of different teams are internally bidding for firm employees. "I will pay you a bonus of 500$ a month for the project". "I will pay you 400$/month extra, and also you will not have to work with either SAP or Carl on my team".

Then the employee who spends their day on TikTok and only knows how to copy/paste from stack overflow would be readily identified by a lack of enthusiastic bids, once everyone has worked with them for a project.