Technological businesses carry significant weight within the business community, particularly in sustaining Britain’s strong position in the digital race. Despite this, these firms should still receive the same scrutiny as other sectors. The country’s wage growth has fluctuated in the last few months, leaving households in a stronger but more unstable position. New research has now revealed that certain tech firms have in fact contributed to this financial instability, with tech giants not paying their staff as much as their vast income would allow.
The new report by the Organisation for Economic Co-operation and Development revealed that so-called “superstar” firms such as Google and Amazon share a small proportion of their income with their staff. Despite their substantial position in the market, these tech giants are refusing to share their wealth with the people who worked hard to put them there.
The OECD questions whether these tech giants need tougher regulation, which it predicts was previously dismissed to encourage the “technological frontier” these firms created. If this behaviour continues, startup businesses could see emerging talent suddenly available for recruitment. According to the report, it is in fact, the ‘high-skilled’ workers that are not happy with their pay, and many could jump ship.
If this comes to pass, tech firms should ensure their business is attention-grabbing and has the equipment and technology to not only attract new talent but keep them there. At the Credit Protection Association, our debt recovery services free up cash flow, providing our Members with the financial freedom to overcome economic pitfalls such as sluggish wage worth, as well as create an innovative and efficient working environment.
Companies need people with “highly cognitive, complex, problem-solving” skills or those who are good at “social intelligence — persuading, negotiating and caring for others”. Because they are in short supply, they have been the “beneficiaries of wage growth”, the OECD said.
That has been marked at the “technological frontier”, where the superstar firms operate. “The effect of technological change [on pay] has been significantly less pronounced for high-skilled workers,” the report found.
Superstar firms have delivered far higher productivity growth than other companies but they share less of the proceeds with workers. The “labour share” of corporate income is lower at these firms because they “invest massively in capital intensive technologies”, the OECD said.