CHAPTER 11 The Labor Market
Sara Blakely founded Spanx when she was just 29 years old.
Sara Blakely started her career with a degree in communications and a dream of becoming a lawyer. But law school never panned out, and after a few months working at Walt Disney World and a brief foray into stand-up comedy, she found herself looking for a steady job. She took a sales position at an office supply company. It was a good match, and after a few quick promotions, she became a national sales trainer by her mid-twenties. Unfortunately solid sales skills didn’t translate into job security, and as the market for the fax machines that made up a good chunk of her business faltered, so did her career prospects.
But Sara had learned a lot from her years in sales—and she had an idea. Like many women, she wore pantyhose under her clothes to create a smooth silhouette. One day, she cut the feet out of a pair of pantyhose so that she could wear a pair of strappy sandals with her trousers, and realized she was on to something. She tested different materials, tried different shapes, and kept experimenting until she invented a better product—a footless body-shaper she called “Spanx.” Sara put her sales and communication skills to work, going from store to store, convincing them to stock her product.
Spanx was a hit. Sara went from looking for a steady job to starting her own company and hiring her own staff. Today, Spanx is a global company that employs thousands of people. Sara, who is now a billionaire, attributes much of her company’s success to her savvy in hiring the right people at the right time.
As Sara’s story shows, the labor market will play an important role in shaping your life story. Like Sara, you’re likely to begin your career as a supplier of labor, and as you progress and gain responsibility for hiring, you’ll also be a demander of labor. Each decision you make will shape your future, determining what skills you acquire, how much money you make, and how successful your company is. Our task in this chapter is to adapt your understanding of demand and supply to analyzing the labor market, and Sara’s story illustrates why it’s so important.
We’ll begin with an overview of the labor market, then dig into labor demand decisions, before turning to labor supply. Together, these forces provide a powerful framework for identifying where your best opportunities will lie, empowering you to make good decisions when you’re launching your career, adapting to changes in the labor market, or starting your own successful company.