Article by Richa Singh from Economics Wing, GAEE JMI
Economic recessions and the ensuing job cuts force many people out of conventional workplaces. Many of these people have gone on to create some of the largest companies that we see around us today.
The Microsofts, the Ubers and the Airbnbs of the world were founded during times of economic distress to later enable people to adapt to a changing world. However, some people, particularly of the non entrepreneurial mindset, find themselves working as waiters or waitresses. In 2009, this observation MEN prompted Hugo Lindgren to articulate the Hot Waitress Index in an article in the New York Magazine.
The Hot Waitress Index is one of the many unusual indices that measure the degree to which people are being thwarted by the lack of opportunity. Lindgren presumes that during upturns in the economy, good-looking people do not have trouble finding well-paying jobs. But periods of slowdown when well-paying jobs are hard to come by, good looking people turn to relatively low-paying jobs like waitressing. Even restaurant managers prefer to hire these people believing that attractive servers drive up sales. As the author himself notes, “Being cheerfully attended to by people who might otherwise look right through you is part of the dining experience.”
Though it’s impossible to not take this index with a fistful of salt, there are some merits to it. Good looking, attractive people are generally perceived to be more confident in their demeanour and are thus preferred while taking hiring decisions, more so in client-facing roles. That’s also why students in a B-school are coached to look more presentable during interviews!
Another merit is that this indicator could actually be a leading indicator to signal economic revival. Overall unemployment rates could tend to remain higher even after a recession has technically ended. But comparing the unemployment/underemployment rates of a set of highly-demanded or “hot” employment seekers (pun intended), could signal a revival in the economy much quicker as businesses try to re-staff well paying positions to beat their competitors to it.
The Hot Waitress Indicator is obviously a funny take on predicting economic cycles, a proposition that has hounds economists to this date.
(Richa Singh is a B.A.(Hons.) Economics student at Jamia Millia Islamia, Delhi, and a part GAEE JMI, an autonomous branch of Global Association of Economics Education in India. The views expressed are personal and they do not purport to reflect the opinions or views of GAEE or its members.)
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