The White Collar Recession: What It Is and Why It Matters

It’s no secret that the American economy has spent the past few years struggling to stay afloat. Thousands of jobs have been plunged into uncertainty and chaos since the start of the COVID-19 pandemic. While some individuals have found success working from home by trying out new, innovative work opportunities, others have struggled. Especially white collar tech workers. White collar tech workers are unlikely victims of this economic climate.

With the rise of robots and other technologies, there has been debate over whether bots will replace blue-collar workers. There are some though White collar jobs that can be replaced by bots, the focus has been on blue collar workers. However, it seems that white collar individuals have their own problems.

What is a white collar recession?

usually, When a recession hits, the first layoff experienced by blue-collar workers. Workers in labor-intensive industries such as manufacturing and construction often find themselves out of a job during economic downturns. From there, service personnel are often injured. Because such positions are seen as more expendable than white collar desk jobs.

Generally, white-collar workers don’t see much of an impact from a recession until things get a little dire. However, iWhite collar recession, things work in the opposite direction. While everyone struggles to some extent due to economic changes, white collar workers are the hardest hit.

Epidemic mess

The recent pandemic has created an unprecedented economic crisis. which most Americans struggled to come to terms with. At the start of Covid, Americans were told to stay home to prevent the spread of the virus. As a result, many blue-collar firms have sent workers home temporarily. This causes a brief increase in unemployment.

During Covid, Americans are spending more time online than ever before. Internet usage in the average American home 70% increase. And, instead of going out for groceries or meals, used delivery apps like DoorDash and Amazon. These apps have become hugely popular and somewhat necessary.

Employment Rebellion

Because most Americans were staying at home and using online services, naturally, major technology improvements took place. For example, Amazon offers its customers Prime services – a subscription that promises 2-day delivery on eligible items. When sales skyrocketed during the pandemic, Amazon naturally turned to hiring more workers to keep up with demand and deliver on that promise to customers.

Amazon wasn’t the only big company to experience this staggering increase in profits. Other companies that have adapted to the rapid growth in demand include Shopify, Pepsi, Netflix, Meta and Snapchat. Naturally these companies meet the growing demand Recruited large numbers of new white-collar workers.

perfect storm

After sending their employees home for Covid, CEOs struggled to retain profits simply because people were staying at home. CEOs hoped that employees would return to work after the pandemic, but they were very wrong.

These blue collar workers had to find jobs elsewhere just to survive. Thus, creating what many economic analysts refer to as “structural labor shortages”. This is a self-perpetuating cycle of labor lost and regained. This cycle benefits these major corporations.

The price of labor is falling

To create the illusion of plenty of job opportunities, big tech companies post job listings, only to revise them later without hiring new employees. Sometimes, the salary won’t even be listed, especially if the company doesn’t offer a competitive wage. This severely skews the perception of actually available job opportunities.

With white collar workers being laid off and (sometimes) rehired at such an alarming rate, and blue collar workers being fleeced by corporations, it’s no wonder a recession is underway. Recent economic instability has left many workers questioning the integrity of the American job market.

In addition, many large companies now have “labor reserves”. It refers to the act of retaining employees whose labor is underutilized. Companies don’t want to run the risk of potentially losing labor, but they also don’t want to risk losing profits. Thus, they hold workers to minimum hours and provide benefits. This forces many Americans to seek secondary work elsewhere, thus perpetuating the struggle of the middle and lower classes.

This same line of thinking is applied to white collar industries. Corporations want to maintain output and profits. But they also want to reduce labor costs. In the case of white-collar workers, this results in employees being laid off while their responsibilities are handed over to their colleagues. Their peers generally receive little or no additional compensation.

Overall, there are many great tech CEOs admitted That their companies expanded too quickly during the pandemic. And, they failed to plan how to descale operations — or descale at all.

In addition to the end of the pandemic, cultural shifts in mindsets among Gen Z have also changed the way people think about work. Companies are struggling to keep up with the modern consumer in more ways than one.

Why white collar workers?

Since the end of the pandemic, these big tech companies have seen a significant drop in profits as Americans return to their “normal” lives. Now, hoping to return to “normalcy” and generate enough revenue, these companies have to Conduct thousands of mass layoffs American workers. The primary goal? White collar employee.

The unrest caused by COVID-19 spilled over from blue-collar industries to their white-collar counterparts. Because white-collar workers are typically skilled workers with a higher education level, the jobs are not available to just anyone—unlike many blue-collar jobs.

Corporations, in a constant effort to be on the “winning” side of the economy, begin laying off and then rehiring their employees. This creates white-collar specific volatility. When people earn less money and save more, it creates the ideal environment for an economic downturn; Lack of money flowing through the system.

How to navigate a white collar recession

Although there is no stopping the looming threat of recession, it does not mean the end of the world. There are ways you can navigate the expected economic difficulties and emerge relatively unscathed.

Here are 3 tips to help you get through the troubling times that may lie ahead:

Be open minded

In times of economic uncertainty, being flexible and open to unfamiliar roles and situations is more important than ever. Remember that job requirements are often more like preferences than hard and fast rules.

If you’re feeling down on your luck, try applying to jobs that are a little out of the box or different from what you’re used to. It shows employers’ willingness to adapt and grow.


Networking is one of the most effective ways to find a job, even in the modern world. Persevere through the economic crisis and continue to connect with other people within the industry. You never know which connection might give you a boost when you need it most.

Increase your value

Raise your standards and keep learning new things. This will serve you better than other suggestions. The more you invest in yourself and your skill set, the more valuable you are to potential employers. Even if you have to take your career in a slightly different direction, you’ll gain new experience and knowledge along the way, which will help you improve your long-term job security.


As the current economic climate changes rapidly around us, it is becoming increasingly difficult to predict the next turn of events. Corporations are scrambling to maintain profits despite the constant fluctuations of the free market, and as a result, blue and white collar workers alike are struggling to stay afloat.

Ari bratisis

Tim Writer: Ari is a writer, blogger and small business owner based in Washington State.

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Business Opportunities · Company Culture · Find Your Way · Grow Your Business · Leadership · Success

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