Saturday, July 17, 2010

Our Impact

When people ask me about my business, one of their first questions is how many employees I have.  It’s everyone’s proxy for how big my business is and also, I think, how big its impact is.  The same number is used to measure the same things in many government programs and sometimes it’s the only measure used.

My business makes me wonder whether the number of jobs created by a business isn’t an outdated way to measure economic impact.  Technology has made it possible for people to collaborate and work together without being physically together, and many more people than ever provide outsourced services to businesses as a result.  Small businesses like mine that are just gearing up use these contract services extensively because we don’t have enough work to justify full time employees yet.  My national sales forced, marketing and web services, payroll processing, controller, legal council, warehousing and wholesale order fulfillment, are all done by third parties.  About 8 full time truck drivers have been hired by other companies because of my business.  If I add all of this up, we probably created closer to 30 jobs than the 16 that are actually my employees.

Wellness businesses like mine create a broad range of secondary benefits (some would say primary) that we ought to measure as well.  Are the jobs created good ones (living wage with benefits).  Does how we source are raw materials contribute to a more sustainable world or detract from it? Do our products make people more or less healthy; even help their bodies heal themselves?  Do we do we can do to be good stewards of the natural resources we do use?  I can honestly say yes to all of these questions and that’s a source of great pride for me personally. 

We ought to find a way to take these things into account when we are looking at the total impact of a business on an economy and community.  We are at a point where we are drowning in negative secondary economic impacts.  For example, when a company launches new foods that are loaded with sugar or high fructose corn syrup, they aren’t just creating jobs, they are also creating foods that contribute to the obesity epidemic in the country, something that is one of the biggest drivers of health care utilization and one that most experts think could literally bankrupt our current health care system.  Shouldn’t businesses that manage to create jobs for people and make products that are good for people somehow get more “credit” for that than businesses that are indirectly making people sick? 

 The problem is that in a free market system, companies that create products that people like (despite them being bad for them), ceteris paribus, perform well.  It isn’t until years later that the cumulative effect of eating these foods creates chronic disease, at which point the costs have been exported to people paying for health insurance and taxpayers who fund government health insurance programs.  There is therefore a disconnect in both calendar time and the recipient that makes it impossible for market signals to favor wellness businesses over illness businesses.

Maybe this all starts by asking different questions in the beginning.  If instead of people asking me how many jobs I created, they asked me how my company supports human health, they would learn enough to choose wellness over illness.  It’s the choices we make, each and every day, that add up to the world we live in.  If we don’t like the results we see around us, then its time to get different information and make different choices.