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The "Investing in America and Investing in Americans" initiative (or the "Good Jobs EO" as it is also known) recently unveiled by the White House, promises to significantly alter the US job market.
Assuming the promise is followed through on, and not derailed by a Republican election victory, what does it mean for workers and employers?
By focusing on creating "quality" jobs through federal investments, the initiative may have widespread implications for recruitment strategies, HR departments, and talent acquisition.
Prioritizing competitive wages, worker safety, unionization rights, and access to benefits like childcare support may reshape how businesses attract talent, manage workforce diversity, and approach benefits and compensation structures.
At the heart of it is the expansion of the Department of Labor's Good Jobs Initiative, which has already influenced the distribution of around $240billion in federal funds towards projects that emphasize fair wages, safety standards, diversity in hiring, and comprehensive benefits packages.
From retention to risk reduction: How to deliver training to improve employee experience
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The directive integrates the efforts of numerous federal agencies, including the Departments of Labor, Commerce, and Education, and creates a task force designed to embed the principles of "good job" creation into long-term federal investment policies.
"My vision has always been … to grow our economy from the middle out and bottom up instead of the top down," President Biden said.
"Too many presidents like my predecessor look the other way as companies trample on rights of workers while cashing big government checks. But not anymore," he added.
Impacts on HR departments and recruitment
One of the initiative's immediate effects will be on HR departments and their recruitment strategies. With the policy setting higher standards for wages and benefits, organizations will need to adjust their compensation structures to stay competitive.
Under the new guidelines, federal contracts will set wage standards above the median wage level, prompting private companies to follow suit if they wish to attract top talent.
Such a shift is a double-edged sword for HR departments.
On the one hand, it may drive up labor costs, requiring businesses to reallocate resources. On the other, companies that adapt quickly and embrace the policy's principles could find themselves in a stronger position to attract skilled workers.
Competitive pay, in combination with robust benefit packages, will make job postings more appealing, especially in sectors like manufacturing, infrastructure, and clean energy that are poised to receive significant federal investments.
In addition, the emphasis on benefits such as childcare could unlock new talent pools, freeing up parents and caregivers, especially women, to re-enter the workforce.
Promoting diversity and inclusion in hiring
Federal projects that receive funding will be required to demonstrate not only fair wages and benefits but also efforts to promote diversity and inclusion. This is sure to ruffle the feathers (and their tar too if that could be ruffled) of right-wing opponents that have become emboldened by success in getting big names like Ford, Harley-Davidson, Jack Daniels and others to abandon their DEI commitments.
Under the new policy, federally funded projects will be incentivized or required to renew their focus on DEI. For HR departments, it means expanding recruitment efforts to reach underrepresented groups and ensuring that hiring processes are equitable and transparent.
The increased emphasis on diversity could help transform workplace culture and boost employee morale. As businesses align their recruitment and HR practices with the principles outlined in the initiative, they could see not only a broader talent pool but also improved organizational performance.
Implications for business strategy
For businesses, the “Good Jobs” Executive Order represents both a challenge and an opportunity. Adhering to the policy's requirements might necessitate costly changes, such as increased wages and expanded benefits. Additionally, companies might need to rethink their relationships with unions. The policy encourages unionization, and while some businesses may view this as a threat to their autonomy, others may see it as a way to create a more engaged and stable workforce.
The long-term benefits of the policy, however, could outweigh the short-term outgoings. By investing in their workforce and offering competitive compensation packages, businesses can reduce employee turnover, a major cost for companies across industries. The Center for American Progress reports that the cost to replace an employee can be as high as 20% of their annual salary.
Reducing turnover by offering better wages, benefits, and working conditions could help offset any upfront costs incurred by adapting to the new policies.
Moreover, businesses that align their strategies with the Federal Government's vision may find themselves in a prime position to benefit from Government contracts and federal projects.
The "Good Jobs” order is a bold step toward redefining what actually counts as one in the 21st-century economy. For HR departments and recruiters, it means a shift in how they approach compensation, benefits, and DEI.
Businesses that embrace it are likely to find themselves better positioned to attract top talent and reduce turnover, benefiting from a more stable and productive workforce.
While the policy presents some challenges, particularly in terms of cost, its long-term impact on the US job market may be a more inclusive, competitive, and resilient economy.
Assuming it is all still in place after the next election.
