The thing about rich bosses

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Does it matter if your boss is rich?

This is a question I’ve rarely thought about over the years, mostly when non-wealthy friends have unexpected disagreements with rich bosses.

“Why don’t you get a babysitter?” There was an Australian woman who listened to a politely confused new manager explain that she had to take off work every afternoon to pick up her children from school before asking. Alas, she said, the company would be hard pressed on the salary she was paying.

Another friend, who can only afford property miles away from her office, surprised her wealthy neighbor by telling her how much money she saved on train tickets by working from home during the pandemic.

Then it was the executive who invited the group into his spacious house for a morning meeting and led them not into the dining room or the kitchen, but into the “breakfast room,” which was entirely reserved for breakfast. It’s bigger than most of the guests’ apartments, none of whom have ever 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 might become more common.

In developed countries in Europe, Asia and North America, wealthier workers are being separated from those who are less well-off.

Within industries and within individual firms, the authors said, “the vulnerability of high-income earners to low-income earners is significantly reduced.” The great separation Paper Published at the end of last year.

Look at France. In the year In 1994, the top 1 percent of French earners worked in positions where 9 percent of their colleagues were in the same top income group. In the year By 2019, that 9 percent share nearly doubled to 16 percent.

In the year In 2006, in the Netherlands, the top 10 percent of earners were earning the same amount as 25 percent of their colleagues. By 2020, this percentage has grown to nearly 30 percent.

The higher the level of income, the less likely they are to join the ranks of low-wage workers.

There are many reasons why this happens, starting with the decline in industrial activity. Factory life brings together blue-collar workers with supervisors, engineers, managers and executives. It’s different in a bank, an insurance company, or a software developer.

Outsourcing or offshoring jobs such as data-entry or payroll clerk roles reinforces the divide by removing low-income workers from the office.

So is the rise of digitization that automates low-paying jobs. This trend underscores why wealth inequality is likely to grow.

The paper’s research began several years ago, says Professor Halil Sabanchi of the Frankfurt School of Finance and Management.

This was before ChatGPT and other advanced forms of artificial intelligence emerged in the workplace. Sabanchi thinks it’s reasonable to expect that AI will accelerate the division of wealth that digitalization has brought about at work.

All this could have political consequences.

Sabanci and his colleagues suspect that the marginalization of working elites has helped fuel resentment among poor workers who already read or hear about the lives of high earners but rarely see or meet them.

“This situation can foster feelings and experiences of being left behind, neglected and misunderstood,” they write, which has helped fuel Trumpism and other forms of populism in Europe.

Voter polarization between wealthy capitals or coastal cities and struggling hinterlands has certainly been a striking feature of successive elections, from the 2016 UK Brexit vote to the US and French presidential battles.

In the year Jean-Marie Le Pen’s 15.6 percent of the vote in the Paris region in 1988 was the same as her 14.4 percent, some of the newspaper’s authors wrote. Previous research.

Thirty years later, support for Marine Le Pen, daughter of the right-wing populist leader, has fallen to 12.5 percent in Paris but has risen to 27 percent elsewhere – almost double her father’s vote.

Of course, this change is not just about separating high earners from the rest of the workforce. But it’s easy to see that this separation can fuel change, and perhaps even accelerate it.

pilita.clark@ft.com