Employees Are Not Commodities

What is a commodity? In the simplest terms, it is a good or raw material that is bought or sold or traded for something else that holds value. The commodity’s value can fluctuate based on supply and demand. Labor has often been seen as a commodity and is part of the equation when an employer puts value on an open position.

Employers likely do not even realize this, but they often treat employees as commodities. They are expendable and are only worth the price they cost in exchange for the work they do.

Even the recruiting and HR industry refer to employees like they are “things” to be won or lost – “score”, “acquire”, “top talent”, “human capital”, “poaching”, “talent acquisition”, “resources”- these are just a handful of the terms often used.

I have also seen this over and over in how job seekers are treated in the recruiting industry. In my article The Recruiting Industry is a Racket, I talk about the contingency-based recruiting model that permeates the industry and that sets up a dynamic of treating job seekers like products to be sold as fast as possible, for the best possible price. Just like a commodity.

So, let me ask you, when you have been an employee, and you were hired for a job, did you feel like you were a commodity, vying for the best price in exchange for the knowledge, skills, and experience you have spent your years building?

The truth is, that yes, there is an aspect of work that can be seen as a commodity, but the tragedy is that we treat humans like they are things to be “scored”, “bought”, “traded in” and “upgraded”.

Here is a case in point that is the foundation of the tech industry:

A job seeker goes to college for computer engineering, knows all the latest programming languages, has years of experience with database programming, software development, website development, and mobile app development. She is a strong and valuable member of many dev teams. She gets hired at ACME XYZ, Inc. She has all the knowledge that ACME XYZ needs to improve their products. But then new leadership comes in and decides they have to pivot to a new platform and use the most cutting-edge programming language, the new and sexy one on the street. But this solid, experienced employee does not know this language, she has never needed to use it, and therefore has not had a reason to learn it. Does ACME XYZ spend the time and money to invest in teaching her this new language? Not likely, in most tech companies, she is now a liability, not an asset. So, they cut her loose and hire a new developer who knows this new language. And they continue to cycle through developers like this for years to come.

Where is the regard for the human life that is affected? The human being attached to all that knowledge, that college degree, that experience. Her life, her spirit, her confidence, her livelihood? What about her family and how it affects them to have her unemployed for a time? And what about the team of humans that are affected when she leaves, the relationships that were developed, and the way her absence puts stress on the collective? In most cases the humanness behind the “employee” is not considered at all. They are just a worker-bee.

To further illustrate the commodity thinking, during the hiring process, job seekers are often treated like suspects in a criminal case. They get interrogated with accusatory questioning, with the assumption that they lie, and the recruiter or hiring manager generally only cares about whether the person fits the needs of the position, with little to no regard for what the job seeker desires or needs, or what will help them thrive, be the best version of themselves at work and beyond.

So, what is the problem with this approach? Let’s unpack that from the perspective of the employer or company…

To start, the cost of hiring is high. Most stats show the cost is between 30% – 50% of the annual salary of the person being hired. If you are a small business owner, who most likely does all the hiring yourself, you could be spending even more! That is a lot of money wasted on the churn of commodity-based hiring. It will always be more expensive to fire and hire, fire and hire, than it is to invest in the right fit employees.

Second, the psychological cost is also incredibly high. How does it affect our mental health to be treated like an expendable commodity?

Treating employees like commodities greatly erodes safety and trust and creates an undertow of fear and of stress. This undertow will inevitably seep into the culture and create a foundation that encourages toxic behavior. The team will always wonder if they could be next. Which in turn deeply affects performance, effectiveness, and quality of work- and in the end, the bottom line.

There is a common saying in the employment arena, which is to Hire Slow and Fire Fast. I am a proponent of this approach when there is a mis-hire, a wrong fit. But when this approach is used as a way to cycle through people because they are suddenly seen as losing value, then we have a problem.

What needs to be done? We need to make a cultural shift. And that starts with you and me, and our mindset. We tend to accept the status quo, and the large players tend to set the tone for the rest of us. But we, the small business owners, can do it differently, and as history has shown, that will have a far-reaching ripple effect. We, after all, collectively employ about half of all employees in the United States, making us the largest employer and having the biggest impact on the “status-quo”.

To begin, take a look at your own mindset, and your actions. Do they line up? What is your attitude about employees? How do you treat them? How do you interview them? What tone do you set from the very start?

We have to see employees as the most valuable asset in our companies, more so than clients, revenue, IP, processes, and all that goes into running a company. Without our people, we really only have an idea—one that can’t get traction, have impact, or grow. We need to realize our teams are the heart of our business. And we need to treat them as such.

We have to remember that employees are human beings with feelings. We have to prioritize safety and respect in our workplaces. And by safety, I do not just mean physical safety. It has to be emotionally safe, as well. It has to be safe to be fallible, to speak up, to oppose, to make mistakes. We have to create a culture where our employees do not feel their jobs are on the line all the time, and that they will quickly become outdated, irrelevant, or expendable.

By starting here, you will find your employee loyalty will increase, your culture will be stronger, and you will have fewer headaches and less stress around performance, turn-over, and all that lost revenue.