* Women’s wages dropped 4.4 percent in states where unionized companies made union dues optional. (Men’s wages were 1.7 percent lower).
* The hit to wages was higher among non-whites. Blacks and Hispanics were paid 4.8 percent and 4.4 percent less than their non-union peers.
* On average, annual wages and benefits are $1,500 lower in RTW states than for comparable workers in non-RTW states — for both union and nonunion workers.
* Right-to-work laws widened the pay gap between men and women.
Who are the real “job creators”? Contrary to conventional wisdom, the answer seems to be: People who have jobs – particularly those which pay well. Well-paid employees buy things, and that creates jobs for other people.
And what creates those kinds of jobs? A healthy union movement. Unions are also a bulwark against income inequality, an economic distortion which even conservative Forbes magazine acknowledges is bad for the economy.
It looks to all the world as if there’s a correlation here: Union membership goes down – deficits go up. Perhaps the correlation isn’t as strong as it looks, but the idea isn’t crazy. Higher-paid employees pay more in taxes, which is good for the government’s bottom line. They require fewer government services. The same is true of their families, neighborhoods, and communities. And their contribution to economic growth means everybody’s better off.
The lesson for all those deficit-obsessed policymakers might be, to paraphrase the late Joe Hill: Don’t “austerize,” organize.
Maybe that’s why the 1956 Republican Party platform boasted that under the leadership of President Eisenhower “unions have grown in strength and responsibility, and have increased their membership by 2 millions.” They knew what was good for the economy … and good for business.
Walmart, the nation’s largest private employer, plans to begin denying health insurance to newly hired employees who work fewer than 30 hours a week, according to a copy of the company’s policy obtained by The Huffington Post.
Under the policy, slated to take effect in January, Walmart also reserves the right to eliminate health care coverage for certain workers if their average workweek dips below 30 hours — something that happens with regularity and at the direction of company managers.
Walmart declined to disclose how many of its roughly 1.4 million U.S. workers are vulnerable to losing medical insurance under its new policy. In an emailed statement, company spokesman David Tovar said Walmart had “made a business decision” not to respond to questions from The Huffington Post and accused the publication of unfair coverage.
Labor and health care experts portrayed Walmart’s decision to exclude workers from its medical plans as an attempt to limit costs while taking advantage of the national health care reform known as Obamacare. Among the key features of Obamacare is an expansion of Medicaid, the taxpayer-financed health insurance program for poor people. Many of the Walmart workers who might be dropped from the company’s health care plans earn so little that they would qualify for the expanded Medicaid program, these experts said.
“Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan, which is one of the problems with the way the law is structured,” said Ken Jacobs, chairman of the Labor Research Center at the University of California, Berkeley.
For Walmart, this latest policy represents a step back in time. Almost seven years ago, as Walmart confronted public criticism that its employees couldn’t afford its benefits, the company announced with much fanfare that it would expand health coverage for part-time workers.
But last year, the company eliminated coverage for some part-time workers — those new hires working 24 hours a week or less. Now, Walmart is going further.
Jobs are slowly returning to America, but most of them pay lousy wages and low if non-existent benefits. The Bureau of Labor Statistics estimates that 7 out of 10 growth occupations over the next decade will be low-wage — like serving customers at big-box retailers and fast-food chains. That’s why the median wage keeps dropping, especially for the 80 percent of the workforce that’s paid by the hour.
It’s also part of the reason why the percent of Americans living below the poverty line has been increasing even as the economy has started to recover — from 12.3 percent in 2006 to 15 percent in 2011. More than 46 million Americans now live below the poverty line.
Many of them have jobs. The problem is that these jobs just don’t pay enough to lift their families out of poverty.
So, encouraged by the economic recovery and perhaps also by the election returns, low-wage workers have started to organize.
These workers are not teenagers. Most have to support their families. According to the Bureau of Labor Statistics, the median age of fast-food workers is over 28; and women, who comprise two-thirds of the industry, are over 32. The median age of big-box retail workers is over 30.
Organizing makes economic sense.
Unlike industrial jobs, these can’t be outsourced abroad. Nor are they likely to be replaced by automated machinery and computers. The service these workers provide is personal and direct: Someone has to be on hand to help customers and dole out the burgers.
And any wage gains they receive aren’t likely to be passed on to consumers in higher prices because big-box retailers and fast-food chains have to compete intensely for consumers. They have no choice but to keep their prices low.
That means wage gains are likely to come out of profits – which, in turn, would affect the return to shareholders and the total compensation of top executives.
That wouldn’t be such a bad thing.
According to a recent report by the National Employment Law Project, most low-wage workers are employed by large corporations that have been enjoying healthy profits. Three-quarters of these employers (the fifty biggest employers of low-wage workers) are raking in higher revenues now than they did before the recession.
America is becoming more unequal by the day. So wouldn’t it be sensible to encourage unionization at fast-food and big-box retailers?
Yes, but here’s the problem.
The unemployment rate among people with just a high school degree – which describes most (but not all) fast-food and big-box retail workers – is still in the stratosphere. The Bureau of Labor Statistics puts it at 12.2 percent, and that’s conservative estimate. It was 7.7 percent at the start of 2008.
High unemployment makes it much harder to organize a union because workers are even more fearful than usual of losing their jobs. Eight dollars an hour is better than no dollars an hour. And employers at big-box and fast-food chains have not been reluctant to give the boot to employees associated with attempts to organize for higher wages.
Meanwhile, only half of the people who lose their jobs qualify for unemployment insurance these days. Retail workers in big-boxes and fast-food chains rarely qualify because they hadn’t been on the job long enough or were there only part-time. This makes the risk of job loss even greater.
Which brings us back to what’s happening in Washington.
Washington’s obsession with deficit reduction makes it all the more likely these workers will face continuing high unemployment – even higher if the nation succumbs to deficit hysteria. That’s because cutting government spending reduces overall demand, which hits low-wage workers hardest. They and their families are the biggest casualties of austerity economics.
And if the spending cuts Washington is contemplating fall on low-wage workers whose families are under the poverty line – reducing not only the availability of unemployment insurance but also food stamps, housing assistance, infant and child nutrition, child health care and Medicaid – it will be even worse. (It’s worth recalling, in this regard, that 62 percent of the cuts in the Republican budget engineered by Paul Ryan fell on America’s poor.)
By contrast, low levels of unemployment invite wage gains and make it easier to organize unions. The last time America’s low-wage workers got a real raise (apart from the last hike in the minimum wage) was in the late 1990s, when unemployment dropped to 4 percent nationally – compelling employers to raise wages in order to recruit and retain them, and prompting a round of labor organizing.
That’s one reason why job growth must be the nation’s number one priority. Not deficit reduction.
Yet neither side in the current “fiscal cliff” negotiations is talking about America’s low-wage workers. They’re invisible in official Washington.
Not only are they unorganized for the purpose of getting a larger share of the profits at Wal-Mart, McDonalds, and other giant firms, they’re also unorganized for the purpose of being heard in our nation’s capital. There’s no national association of low-wage workers. They don’t contribute much to political campaigns. They have no Super PAC. They don’t have Washington lobbyists.
But if this nation is to reverse the scourge of widening inequality, Washington needs to start paying attention to them. And the rest of us should do everything we can to pressure Washington and big-box retailers and fast-food chains to raise their pay.
The biggest wave of job actions in the history of America’s fast-food industry began at 6:30 a.m. on Thursday at a McDonald’s at Madison Avenue and 40th Street, with several dozen protesters chanting: “Hey, hey, what do you say? We demand fair pay.”
From Walmart to fast-food, workers are demanding a living wage & the right to unionize!
The term “McJob” has come to epitomize all that’s wrong with the low-wage service industry jobs that are growing part of the U.S economy. “It beats flipping burgers,” the cliché goes, because no matter what your job might be, it’s assumed to be better than working in a fast-food restaurant.
Today in New York City, though, hundreds of workers at dozens of fast-food chain stores are walking out on strike, demanding better of those jobs. At McDonald’s, Burger King, Wendy’s, KFC, Taco Bell, and Domino’s Pizza locations, workers have been organizing, and today they launch their campaign. They want a raise, to $15-an-hour from their current near-minimum wage pay, and recognition for their independent union, the Fast Food Workers Committee.
Saavedra Jantuah, who works at a Burger King on 34th St. in Manhattan, explained that the $7.30 she makes per hour after two years on the job doesn’t pay her enough to support her son. “I’m doing it for him, I’m going on strike so I can bring my family together underneath one household,” she said. “A union can help us get to where we can make it in New York.”
Cannot even express how thrilled I am about this story. I’ll be on the picket lines with the workers in a couple of hours, with photos and more stories. Service jobs don’t have to be lousy jobs—respect and a decent wage would do a lot.
Downsizing, lower pay, reduced benefits — that seems to be the same story at one company after another, as if the sole point of business were to pull in one massive quarterly profit.
But then there’s our number of the day: $19.50.
That’s what a worker at Costco makes after four and a half years, according to Slate Magazine. It’s about $7 an hour more than employees with the same seniority at Costco’s competitor, Sam’s Club.
Some Wall Street analysts haven’t been happy about that or about the company’s generous health plan. No doubt, Costco could be making a higher profit. And yet, the company does just fine. The value of Costco stock has more than doubled since 2009, and the company’s founder, James Sinegal, said those wages buy the company a low rate of employee turnover and theft.
Costco’s generosity saw renewed publicity recently when Wal-Mart became mired in strikes over low pay and bad labor relations. Although Wal-Mart is admittedly a much bigger company, the Costco model proves you don’t have to squeeze employees.
Wal-Mart’s way is not the only way to do business.
Watch ‘Viewpoint with Eliot Spitzer’ weeknights at 8E/5P on Current.
And yet the company does just fine…
112 workers killed in Bangladesh Walmart factory fire
November 26, 2012
NGOs are slamming Walmart following a Saturday fire that killed at least 112 workers at a Bangladesh factory supplying apparel to the retail giant. While Walmart says it has not confirmed that it has any relationship to the factory, photos provided to The Nation show piles of clothes made for one of its exclusive brands.
In a statement e-mailed Sunday night, Walmart expressed sympathy for the victims’ families, and said that it was “trying to determine if the factory has a current relationship with Walmart or one of our suppliers…” The company called fire safety “a critically important area of Walmart’s factory audit program,” and said that it has been “working across the apparel industry to improve fire safety education and training in Bangladesh.” Walmart added that it has “partnered with several independent organizations to develop and roll out fire safety training tools for factory management and workers.”
But in a Monday interview, Workers Rights Consortium Executive Director Scott Nova said Walmart’s “culpability is enormous. First of all they are the largest buyer from Bangladesh” and so “they make the market.” Nova said Bangladesh has become the world’s second-largest apparel supplier “because they’ve given Walmart and its competitors what they want, which is the cheapest possible labor costs.”
“So Walmart is supporting, is incentivizing, an industry strategy in Bangladesh: extreme low wages, non-existent regulation, brutal suppression of any attempt by workers to act collectively to improve wages and conditions,” Nova told The Nation. “This factory is a product of that strategy that Walmart invites, supports, and perpetuates.” The WRC is a labor monitoring group whose board is composed of students, labor organizations, and university administrators.
The fire started Saturday night in a ground-floor warehouse. According to media reports, the factory’s emergency exits were insufficient in number and unsafe in design, routing through the inside, rather than the outside, of the building. Some workers survived on the factory’s roof; several jumped out of the building. A lack of safe fire exits contributed to the death toll in New York’s notorious 1911 Triangle Shirtwaist Factory Fire.
A document on the website of the factory’s owner, Tuba Group, showed that the factory had received an “orange” rating from Walmart in May 2011, because of “violations and/or conditions that were deemed to be high risk.” The same document said that three such ratings within two years would result in a year-long suspension by Walmart.
“Obviously, they didn’t do anything about it,” said Nova. He called Walmart’s internal monitoring system “a joke” that was “set up to enable Walmart to claim that it’s policing, without in any way, shape or form inconveniencing its production process.”
A Walmart spokesperson told The New York Times that the retail giant had been “unable to confirm” the veracity of Tuba Group document, or whether Tazreen Fashions, the Tuba Group subsidiary running the factory, was supplying any Walmart goods.
But photos taken after the fire taken the Bangladesh Center for Worker Solidarity, provided to The Nation by the International Labor Rights Forum, show clothing with Walmart’s exclusive Faded Glory label (photos below). Nova accused Walmart of intentionally dragging its feet on admitting its connection to the factory, in hopes that by the time the connection is confirmed, the media will have lost interest.
WRC’s Nova said that Bangladesh’s deadly labor conditions are a direct consequence of Walmart’s business model. If a factory “really followed the law,” said Nova, “if they allowed workers to organize and bargained a contract, if they invested in necessary health and safety equipment, if they restructured the building to make it safe, put in place sprinklers and outside fire escapes, their costs would rise, they would have to charge more for their product, and they would immediately lose Walmart and their other customers.”
This is why, if I can avoid it, I do NOT shop at wal mart anymore. They are evil!
Increasing the wages of retail workers to $25,000 per year would lift roughly 730,000 workers and their families out of poverty, according to the Demos study. It would also increase the purchasing power of retail workers by $4 to $5 billion, boosting overall GDP by between $11.8 and $15.2 billion. And in doing so, it would generate between 100,000 and 132,000 new jobs as a result of this “stimulus” and its multiplier effects, while having only a small effect on prices, the report finds.
Paying retail workers better also offers substantial benefits to the companies that employ them. While this may seem counterintuitive, detailed academic research backs it up. Zeynep Ton of MIT’s Sloan School of Management argues that seeing keeping wages low as the way to achieve low prices and high profits is badly mistaken: “The problem with this very common view is that it assumes that an employee working at a low-cost retailer can’t be any more productive than he or she currently is. It’s mindless work so it doesn’t matter who does it. If that were true, then it really wouldn’t make any sense to pay retail workers any more than the least you can get away with.”Like the leading high-tech and manufacturing companies, the best, most high-performing retail companies benefit from having better paid, more skilled and more engaged workers. In a study published in the Harvard Business Review, Ton finds that the retail companies that invest the most in their lowest paid workers “also have the lowest prices in their industries, solid financial performance, and better customer service than their competitors.”
Compensation for chief executives at American companies grew 15 percent in 2011 after a 28 percent rise in 2010, part of a larger trend that has seen CEO pay skyrocket over the last three decades. Workers, on the other hand, have been left behind.
Since 1978, CEO pay at American firms has risen 725 percent, more than 127 times faster than worker payover the same time period, according to new data from the Economic Policy Institute. […]
For the first time since the recession began, Virginia’s median wage fell in 2011, and median household income slid even further away from its pre-recession peak to about the same as it was a decade ago. In addition, the lingering effects of the recession pulled down even Virginia’s highest wage earners and hit men harder than women across all wage groups. Meanwhile, for workers at the lower end of the wage spectrum, losses continued to mount with wages falling even further below pre-recession levels, and their wage advantage over workers in other states shrinking.
Read more in our latest analysis of Virginia’s wages and income: Setback: The State of Working Virginia.